Micron Projects Tight Memory Supply Through 2028

Micron Technology CEO Sanjay Mehrotra announced that memory and storage supply-demand conditions will remain much tighter through 2027 and 2028. This outlook revises previous projections that suggested supply conditions would improve by 2028.

While the NAND industry is expected to remain supply-constrained, industry bit shipments are projected to rise annually in the mid-20% range. This environment provides earnings durability for flash memory provider Sandisk, though the company faces limitations in capitalizing on the market tightening.

Sandisk is increasingly bound by New Business Model agreements, which are multi-year contracts expected to cover two-thirds of its sales by fiscal 2028. These contracts include price ceilings that cap potential gains. Sandisk CEO David Goeckeler stated the company aims to eliminate the industry's "boom and bust" cycle, describing gross margins in the mid-80% range as a fair return.