Micron's stronger-than-expected results and raised outlook for AI-related products sent Nvidia (NVDA, Financials) up 4.33% in Thursday's premarket, underscoring how upstream demand is powering the GPU maker's momentum.
Micron's (MU, Financials) fiscal Q3 results pointed to a sharp acceleration in demand for AI memory components — and Nvidia was among the biggest beneficiaries. The chipmaker's shares gained over 4% in early trading Thursday after Micron's upbeat earnings and guidance hinted at sustained demand for GPU-accelerated computing.
Micron reported revenue of $9.3 billion, beating the $8.84 billion estimate, with EPS of $1.91 surpassing the $1.60 consensus. Gross margin guidance for Q4 came in at 42%, while revenue is forecast to reach $10.7 billion — a 15% sequential gain and well ahead of Street estimates.
The key driver was soaring demand for High Bandwidth Memory, or HBM — a type of ultra-fast memory used in AI systems. Micron reported a 50% sequential jump in HBM sales and said data center revenue doubled year-over-year. Since HBM is a critical input for Nvidia's H100 and Blackwell AI chips, investors interpreted Micron's results as a direct signal of Nvidia's accelerating supply chain.
Micron CEO Sanjay Mehrotra said the company is “on track to deliver record revenue with solid profitability and free cash flow in Fiscal 2025,” citing AI as the main driver.
The rally in NVDA stock came even as analysts pushed up their price targets for Micron — with Stifel at $145, Piper Sandler at $165, and Barclays lifting its view from $95 to $140.
The data reinforces Nvidia's role as a downstream beneficiary of rising AI infrastructure buildouts, especially if HBM shipments remain strong.
Investors will now watch for Nvidia's next earnings report and further signs of demand from cloud service providers and enterprise AI users.
