Core Data CenterNarrow moat

Micron Technology (MU) — moat facet

The fastest-growing unit in 2026, up 653% in a quarter — AI demand spreading beyond the largest clouds.

The Core Data Center unit sells memory to enterprise, mid-tier cloud and server makers, and storage to every data-center customer.1 It is the fastest-growing unit in 2026.

Core Data Center revenue by quarter ($B)$1.53BQ3 FY25$5.69BQ2 FY26$11.52BQ3 FY26Micron Forms 10-Q, February and May 2026
Doubled in a quarter and grew 7.5 times in a year.

It brought in $2,124 million in fiscal 2023, $4,984 million in 2024 and $7,229 million in 2025.2 Its operating result went from a loss of $563 million to profits of $255 million and $2,180 million.3

It is paid at contract and spot prices for standard server memory and solid-state drives, which moves it closer to the commodity cycle than the Cloud Memory unit. That showed in the quarter to May 2026: revenue of $11,524 million against $1,530 million a year earlier, up 653%, and operating income of $9,519 million, an 83% margin.45

Nine-month revenue was $19,590 million against $5,652 million, and operating income $14,218 million against $1,789 million.6

The unit's research budget was $864 million in fiscal 2025, second among the four.7

This is a narrow moat that rides the shortage. The figure to follow is the unit's revenue against Cloud Memory's: $11.5 billion against $13.8 billion in the May quarter. If it keeps closing the gap, AI demand has spread beyond the largest clouds; if it falls back first, standard server memory is where the cycle turns.

Moat trajectory: Widening

Revenue up 653% in the May quarter to $11.5B at an 83% operating margin.

The number that tests this moat
Reported
Core Data Center revenue, latest quarter
$11.5B in Q3 FY2026, up 653% from $1.5B

Closing on Cloud Memory's $13.8B would mean AI demand has spread beyond the largest clouds.

Source: Micron Form 10-Q, May 2026 ↗
References
  1. ReportedThe Core Data Center unit sells memory to enterprise, mid-tier cloud and server makers, and storage to every data-center customer.
    Micron Form 10-Q, quarter ended 28 May 2026 - revenue $41,456M ($9,301M); cost of goods sold $6,400M ($5,793M); gross margin 84.6%; operating income $33,318M; net income $28,243M; DRAM $31,328M, NAND $9,943M; business units CMBU $13,769M, CDBU $11,524M, MCBU $11,521M, AEBU $4,634M with segment operating income; nine-month revenue $78,959M, operating income $55,589M, R&D $3,737M, capex $19,602M, government incentives $2,989M, income tax $8,178M; take-or-pay strategic customer agreements with remaining performance obligations of about $5 billion (about one-third within twelve months), $422M in contract liabilities — Q3 FY2026 · publ. June 2026 · source ↗
  2. ReportedIt brought in $2,124 million in fiscal 2023, $4,984 million in 2024 and $7,229 million in 2025.
    Micron Form 10-K, FY2025 - revenue $37,378M/$25,111M/$15,540M; DRAM $28,578M/$17,603M/$10,978M; NAND $8,503M/$7,227M/$4,206M; operating income $9,770M/$1,304M/-$5,745M; R&D $3,798M/$3,430M; capex $15,857M/$8,386M/$7,676M; government incentives received $2,005M/$315M/$710M; business units (CMBU $13,524M/$3,792M/$1,872M, CDBU $7,229M/$4,984M/$2,124M, MCBU $11,859M/$11,667M/$7,394M, AEBU $4,753M/$4,631M/$4,139M) with segment gross margin and operating income; one customer 17% of 2025 revenue; revenue by customer headquarters (U.S. $24,113M, Mainland China $2,639M) — FY2023-FY2025 · publ. October 2025 · source ↗
  3. ReportedIts operating result went from a loss of $563 million to profits of $255 million and $2,180 million.
    Micron Form 10-K, FY2025 - revenue $37,378M/$25,111M/$15,540M; DRAM $28,578M/$17,603M/$10,978M; NAND $8,503M/$7,227M/$4,206M; operating income $9,770M/$1,304M/-$5,745M; R&D $3,798M/$3,430M; capex $15,857M/$8,386M/$7,676M; government incentives received $2,005M/$315M/$710M; business units (CMBU $13,524M/$3,792M/$1,872M, CDBU $7,229M/$4,984M/$2,124M, MCBU $11,859M/$11,667M/$7,394M, AEBU $4,753M/$4,631M/$4,139M) with segment gross margin and operating income; one customer 17% of 2025 revenue; revenue by customer headquarters (U.S. $24,113M, Mainland China $2,639M) — FY2023-FY2025 · publ. October 2025 · source ↗
  4. ReportedThat showed in the quarter to May 2026: revenue of $11,524 million against $1,530 million a year earlier, up 653%, and operating income of $9,519 million, an 83% margin.
    Micron Form 10-Q, quarter ended 28 May 2026 - revenue $41,456M ($9,301M); cost of goods sold $6,400M ($5,793M); gross margin 84.6%; operating income $33,318M; net income $28,243M; DRAM $31,328M, NAND $9,943M; business units CMBU $13,769M, CDBU $11,524M, MCBU $11,521M, AEBU $4,634M with segment operating income; nine-month revenue $78,959M, operating income $55,589M, R&D $3,737M, capex $19,602M, government incentives $2,989M, income tax $8,178M; take-or-pay strategic customer agreements with remaining performance obligations of about $5 billion (about one-third within twelve months), $422M in contract liabilities — Q3 FY2026 · publ. June 2026 · source ↗
  5. Moat Explorer calcThat showed in the quarter to May 2026: revenue of $11,524 million against $1,530 million a year earlier, up 653%, and operating income of $9,519 million, an 83% margin.
    Moat Explorer calculation from Micron's Forms 10-K FY2021-FY2025 and 10-Qs for fiscal 2026: margins, shares and growth rates as stated — 2019 to Q3 FY2026 · publ. 2026-09-23 · source ↗
  6. ReportedNine-month revenue was $19,590 million against $5,652 million, and operating income $14,218 million against $1,789 million.
    Micron Form 10-Q, quarter ended 28 May 2026 - revenue $41,456M ($9,301M); cost of goods sold $6,400M ($5,793M); gross margin 84.6%; operating income $33,318M; net income $28,243M; DRAM $31,328M, NAND $9,943M; business units CMBU $13,769M, CDBU $11,524M, MCBU $11,521M, AEBU $4,634M with segment operating income; nine-month revenue $78,959M, operating income $55,589M, R&D $3,737M, capex $19,602M, government incentives $2,989M, income tax $8,178M; take-or-pay strategic customer agreements with remaining performance obligations of about $5 billion (about one-third within twelve months), $422M in contract liabilities — Q3 FY2026 · publ. June 2026 · source ↗
  7. ReportedThe unit's research budget was $864 million in fiscal 2025, second among the four.
    Micron Form 10-K, FY2025 - revenue $37,378M/$25,111M/$15,540M; DRAM $28,578M/$17,603M/$10,978M; NAND $8,503M/$7,227M/$4,206M; operating income $9,770M/$1,304M/-$5,745M; R&D $3,798M/$3,430M; capex $15,857M/$8,386M/$7,676M; government incentives received $2,005M/$315M/$710M; business units (CMBU $13,524M/$3,792M/$1,872M, CDBU $7,229M/$4,984M/$2,124M, MCBU $11,859M/$11,667M/$7,394M, AEBU $4,753M/$4,631M/$4,139M) with segment gross margin and operating income; one customer 17% of 2025 revenue; revenue by customer headquarters (U.S. $24,113M, Mainland China $2,639M) — FY2023-FY2025 · publ. October 2025 · source ↗
Sources
Generated September 23, 2026