By Trefis Team
Publication Date: 2026-09-21 20:31:00
If you own NVIDIA (NVDA) or Micron Technology (MU), you own the same idea: AI data centers want more chips and memory than the industry can supply. The two split from there. NVIDIA is putting its own balance sheet behind some of its biggest buyers. Micron’s buyers are posting cash deposits to secure its memory, so the money flows in opposite directions.
Whose Outlook Rests On Signed Contracts?
NVIDIA’s late-August outlook is a forecast. Management expects revenue to grow about 70% in fiscal 2028 and calls that a supply-constrained number.
Micron’s late-June outlook rests partly on contracts. It has signed 16 strategic customer agreements, typically five-year take-or-pay deals. Fourteen of the 16 carry about $100 billion of revenue at minimum contract prices over their remaining term. Management expects actual revenue to run well above that floor.
What Are NVIDIA Holders Underwriting Beyond The Chips?
The first cost is financing. NVIDIA has invested nearly $50 billion in frontier AI labs. The CFO concedes some will call this circular financing and argues the risk is limited because the chips can be redeployed to other customers.
The second cost is memory. NVIDIA’s gross margin was 75% in fiscal Q2 2027. Because memory prices have risen more than it expected, management now expects it to bottom at 71% to 72% in fiscal Q4 2027 before settling at 72% to 73% in fiscal 2028 as its own…
