06:46 AM EDT, 03/19/2026 (MT Newswires) -- Micron Technology ( MU ) reported stronger-than-expected fiscal second-quarter results and issued an upbeat outlook for the ongoing three-month period, but the semiconductor manufacturer flagged higher spending plans amid memory supply constraints, bringing its stock down early Thursday.

The company anticipates dynamic random-access memory, or DRAM, and NAND flash memory demand to be constrained by supply this calendar year and continues to expect supply-demand conditions for both components to "remain tight" beyond 2026, Chief Executive Sanjay Mehrotra said during a late Wednesday conference call, according to a FactSet transcript. The supply constraints could cause personal computer and smartphone units to decline in the low-double-digit range this year, Mehrotra said.

"Micron is working to address the unprecedented gap between supply and demand," according to Mehrotra. Shares of the company declined 5.2% in the most recent premarket activity. The stock is up 61% so far this year.

Micron projects capital expenditures for its 2026 fiscal year to be above $25 billion, with the majority of the increase driven by cleanroom facility-related expenditures, followed by higher construction spending on its fab projects in the US, Mehrotra said on the call. In December, Micron forecast capital expenditures of about $20 billion for 2026. For fiscal 2027, the company expects capital expenditures to "step up meaningfully," the CEO said on Wednesday's call.

"As we make these investments, we will continue to be responsive to the market environment and our customer demand to appropriately align our supply plans," Mehrotra told analysts.

For the quarter ended Feb. 26, Micron reported adjusted earnings of $12.20 per share, up from $1.56 the year before, and topping the FactSet-polled consensus of $9.19. Revenue soared to $23.86 billion from $8.05 billion, ahead of the Street's view for $19.97 billion.

Revenue from the cloud memory business unit amounted to $7.75 billion, up from $2.95 billion in the prior-year quarter. The core data center segment logged revenue of $5.69 billion, rising from $1.83 billion, while mobile and client revenue grew to $7.71 billion from $2.24 billion. The automotive and embedded division sales rose to $2.71 billion from $1.03 billion.

For the fiscal third quarter, the company expects adjusted EPS of $19.15, plus or minus $0.40, and revenue of $33.5 billion, plus or minus $750 million. The Street is looking for non-GAAP EPS of $16.19 and sales of $29.28 billion. Gross margin is pegged at about 81% for the period, with contributions from higher prices, lower costs and favorable mix, Chief Financial Officer Mark Murphy said on the call.

Investors were expecting a "substantial beat and raise," which, along with the stock's recent strong run, helps explain the muted reaction of the company's shares, Wedbush Securities said in a client note. The brokerage maintained its outperform rating on Micron's shares.