Micron Technology (MU) reported a blockbuster fiscal second quarter, with revenue soaring nearly 200% year-over-year to $23.86 billion, driven by explosive demand for high-bandwidth memory (HBM) used in artificial intelligence systems. Despite this, the company's stock fell approximately 5% in after-hours trading on March 18, 2026, as investors grappled with a dual threat: a massive planned increase in capital expenditures and a geopolitical event threatening a critical supply chain.
The primary driver of investor caution was Micron's guidance for "meaningfully" higher capital spending. CEO Sanjay Mehrotra projected fiscal 2027 capex to increase by more than $10 billion from the prior year, with current-year spending expected to exceed $25 billion, well above analyst estimates of $22.4 billion. This spending is necessary to expand production capacity for high-margin HBM, which is critical for AI workloads from companies like Nvidia.
Compounding the financial concerns is a direct supply chain threat stemming from an attack on Qatar's Ras Laffan industrial complex. While Qatar is a major LNG producer, it is also responsible for roughly one-third of the world's helium supply. Helium is a critical, non-substitutable gas used to cool silicon wafers and maintain clean environments in semiconductor fabrication. With the facility offline, the industry faces a potential shortage as chipmakers typically hold only two to six weeks of inventory.
Analysts warn that spot helium prices could triple due to the attack, directly increasing Micron's raw material costs. Furthermore, the broader spike in global LNG prices could inflate the energy-intensive fabrication process's electricity and logistics costs. This creates a "perfect storm" for Micron's margins as it scales high-cost HBM3E production.
Despite the strong fundamentals—Micron guided for fiscal Q3 revenue of ~$33.5 billion and adjusted EPS of ~$19.15, far surpassing consensus estimates of $23.7 billion and $11.29, respectively—Wall Street sentiment was mixed. While firms like Wells Fargo and Barclays raised price targets to $550 and $670, others cited profit-taking and high valuations. Goldman Sachs maintained a Neutral rating, flagging risks of slowing HBM pricing momentum in 2027.
