Micron Heads Into September 30 Earnings Guiding an 86% Gross Margin as Taiwan Labor and Patent Risks Build

MU reports fiscal fourth-quarter results on Wednesday, September 30, carrying guidance it issued in June for a gross margin of about 86% on revenue of $50 billion, plus or minus $1 billion. The stock has climbed 277% since the start of the year and closed Friday's European session at EUR 949.90, about 14% below its 52-week high.

The margin is the central question. Micron's prior memory boom peaked at a then-record 61% gross margin in fiscal 2018, and that figure fell below 29% within four quarters. The company's answer this cycle is 16 customer agreements running three to five years, which have not yet been tested through a downturn.

Two other risks sit alongside the report. In Taiwan, mediation with the Taoyuan union failed on September 21; Micron has offered 35 to 68 months' salary plus a minimum cash payment of NT$1.7 million, while the union wants a fixed payout of 15% of operating profit. The strike vote itself is expected in early October, after earnings, not this week. Separately, the ITC instituted an investigation on September 23 after Netlist alleged that Micron DDR5 server memory modules infringe four of its patents, with Netlist seeking an import ban rather than damages.

Wall Street is divided. Citi raised its target from $1,150 to $1,300, Wells Fargo's Aaron Rakers trimmed his from $1,525 to $1,400, and BMO Capital's Harsh Kumar sits at $1,300. What to watch on September 30: whether the delivered margin lands near 86%, what management guides for the next quarter, and any commentary on contract pricing floors, the Taiwan talks, and the ITC case.