Micron Technology (MU 3.82%) stock has been in red-hot form in 2025. Shares of the memory specialist have nearly doubled so far this year as of this writing, and that's not surprising considering the pace at which its top and bottom lines have been growing.
Micron has been benefiting from the massive demand for memory chips that are deployed in data centers for tackling artificial intelligence (AI) workloads. At the same time, the company is on track to capitalize on the higher memory content in smartphones and personal computers (PCs), as these devices are now being equipped with bigger memory chips to run AI workloads locally.
In fact, it won't be surprising to see Micron repeat its stellar stock market performance in the coming year. Let's look at the reasons why this semiconductor stock has the potential to double once again.
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Micron Technology seems set for another year of terrific growth
Micron reported its fiscal 2025 fourth-quarter results (for the year ended Aug. 28) on Sept. 23. The company finished the fiscal year with a remarkable 49% year-over-year increase in revenue to $37.4 billion. What's more, its non-GAAP earnings jumped by a remarkable 537% year over year to $8.29 per share.
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So, Micron stock's phenomenal rise in 2025 seems justified, and AI has played a central role in helping the company report such terrific growth. After all, the company's revenue from sales of high-bandwidth memory (HBM), high-capacity random access memory (RAM), and server dynamic random access memory (DRAM) jumped by more than 5x in fiscal 2025 to $10 billion.
It is worth noting these chips are being deployed increasingly in data centers where high-performance, large-capacity memory is needed to support AI workloads such as model training and inference applications. The good part is that the demand for AI-capable memory chips such as HBM is set to keep soaring.
Goldman Sachs predicts that the demand for HBMs used in graphics processing units (GPUs) is on track to jump by 23% in 2026. Meanwhile, HBM deployed in application-specific integrated circuits (ASICs) is expected to jump by a much stronger pace of 82% next year, accounting for a third of the total HBM market.
Even better, the average selling price (ASP) of HBM is on track to jump by 18.5% in 2026. This combination of higher volumes and prices should pave the way for remarkable growth in the HBM market next year. Importantly, Micron is in position to make the most of the HBM market's growth in 2026. In the words of CEO Sanjay Mehrotra on the company's latest earnings conference call:
Our HBM customer base has expanded and now includes six customers. We have pricing agreements with almost all customers for a vast majority of our HBM3E supply in calendar 2026. We are in active discussions with customers on the specifications and volumes for HBM4, and we expect to conclude agreements to sell out the remainder of our total HBM calendar 2026 supply in the coming months.
Micron, therefore, is likely to sell its entire HBM capacity for next year soon, despite the fact that it is adding new capacity to meet the surging demand. This should ensure another year of solid growth for the company's HBM business.
However, Micron's AI-driven memory opportunity won't be limited to just data centers in 2026. Market research firm Gartner estimates that sales of generative AI smartphones could jump by 32% next year. Also, AI-enabled PCs could witness a whopping 60% jump in revenue next year. Micron management points out that these AI-enabled devices are equipped with larger compute memory.
So, the growing mix of AI smartphones and PCs should give Micron's addressable market a nice boost in 2026. This explains why the company has issued impressive guidance for the current quarter, and that could pave the way for more upside in the stock price in the coming year.
Here's how the stock may double once again
Micron is expecting $3.75 per share in earnings in fiscal Q1 on revenue of $12.5 billion at the midpoint of its guidance range. That would translate to a year-over-year increase of 44% in revenue along with a jump of more than 2x in earnings to $3.75 per share. It is not surprising to see that analysts are expecting Micron to sustain its earnings growth rate throughout the year.
Consensus estimates are projecting earnings to double in the new fiscal year to $16.30 per share, which seems achievable considering the combination of an increase in memory prices and volumes. Assuming it can indeed hit that mark in the course of the coming year and trades at 22 times earnings after a year (in line with its trailing price-to-earnings ratio), its stock price could jump to $359.
That would be more than double its current stock price. Moreover, investors shouldn't forget that Micron is trading at a significant discount to the tech-laden Nasdaq-100 index's earnings multiple of 33. Since the market could reward it with a higher earnings multiple owing to its terrific growth, there is a good chance of this AI stock doubling once again in the coming year.
