Micron Technology, Inc. (MU) has signed 16 Strategic Customer Agreements (SCAs) to stabilize revenue fluctuations in the memory industry. These agreements, covering approximately 20% of Micron’s DRAM and one-third of its NAND volume, provide predictable demand and pricing and run primarily for five years through 2030. The SCAs are expected to generate about $100 billion in remaining performance obligations and include around $22 billion in customer deposits.
During the third quarter of fiscal 2026, Micron’s revenues surged to $41.46 billion, up from $9.30 billion a year earlier, with non-GAAP earnings reaching $25.11 per share, a significant increase from $1.91. The agreements are structured as take-or-pay contracts, ensuring customers commit to specific volumes, which helps cushion pricing hits during market downturns.
In comparison, competitors like SK Hynix (SKHY) and Sandisk Corporation (SNDK) are also pursuing similar long-term contracts to mitigate revenue volatility. SK Hynix reported a 257% increase in second-quarter revenues, while Sandisk’s revenue increased by 175%. Micron’s approach, however, stands out due to the volume coverage of its SCAs, enhancing its earnings visibility in an unpredictable market.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
