Micron has overtaken Nvidia as the single largest contributor to S&P 500 earnings growth, posting year-over-year profit growth above 1,200% in Q2 2026. The memory chipmaker's stock still trades at less than half the sector's average valuation multiple, even as its earnings outrun almost every other index member.
Micron Technology, the Idaho-based DRAM and NAND manufacturer, already surpassed Nvidia as the largest contributor to S&P 500 earnings growth in Q2 2026, posting year-over-year profit expansion north of 1,200%.
The numbers behind the surge
Micron's fiscal Q3 2026 results were staggering by any standard. Revenue hit $41.46 billion, up 346% from the same quarter a year earlier. Net income landed at $28.24 billion, and gross margins reached 84.9%.
For fiscal Q4 2026, the company is forecasting roughly $50 billion in revenue with an 86% gross margin. Looking further out, analysts project Micron's operating income could climb from approximately $130.4 billion in 2026 to $200.8 billion in 2027, a 54% jump — a pace that would rank the company third in total contributions to S&P 500 profit growth, trailing only Nvidia and Alphabet. Together, Micron and Nvidia accounted for up to 40% of the index's earnings growth in the most recent quarter.
Why memory became the bottleneck
Micron has locked in long-term supply agreements with key customers, including Nvidia itself. Industry-wide, DRAM growth is guided in the low-to-mid 20s% and NAND growth around 20% for calendar 2026, yet Micron's own growth is running far ahead of that broader memory market. As a result, the company appears to be capturing a disproportionate share of the highest-margin AI memory products, and supply constraints in HBM are expected to persist beyond 2027.
The valuation gap that won't close
Despite the growth, Micron's valuation tells a different story: its stock trades at a forward price-to-earnings ratio of approximately 9.2x, well below the S&P 500's weighted average forward P/E of around 20.2x and the information technology sector's average of 22.8x. Micron is trading at less than half the multiple of its own sector, even though it's growing faster than nearly every company in the index.
Source: Crypto Briefing
Trading involves risk.
Risk Disclaimer
