The Big Reason Behind Micron's Impressive Growth? Prices Have Been Soaring, and That Isn't Sustainable

By David Jagielski, CPA – Apr 6, 2026 at 10:30AM ESTKey PointsThe average selling prices for Micron's key products have more than doubled in the past year. For the company to continue generating strong growth, prices will likely need to continue rising.A shortage is expected to remain until at least next year.In the past 12 months, shares of Micron Technology (MU +4.18%) have more than quadrupled in value. The company has experienced significant demand for its memory and storage products. Meanwhile, investors and analysts continue to see much more growth ahead due to the build-out in artificial intelligence as hyperscalers remain aggressive in their growth efforts. Micron's growth has been so impressive that even with such massive gains in its share price, it still looks cheap based on its earnings -- it trades at only six times its estimated future profits. That suggests the stock may still have more upside, given the additional growth analysts expect from the company in the near future. But before you get excited, it's important to consider just why the results have been so strong for Micron. Image source: Getty Images. Prices have been rising significantly In Micron's most recent quarter, which ended on Feb. 26, the company's revenue totaled $23.9 billion -- roughly triple the $8.1 billion it posted in the same period a year ago. And on the bottom line, the result was even more staggering, as net income of $13.8 billion was nearly nine times the $1.6 billion it reported in the prior-year period. Micron says that the revenue growth was largely due to a sharp increase in prices. In its DRAM products, revenue rose by 207%, and it says that was primarily due to a mid-110% increase in average selling prices; shipments rose by just a mid-40%. For NAND products, it was a similar story: sales rose by 169%, as average selling prices more than doubled. The problem is that in future quarters, Micron will be going up against these strong numbers, and unless prices continue to rise at a fast pace, the company's growth rate will inevitably slow down. In the worst-case scenario, where supply even ends up catching up to demand, and prices come down, Micron's growth may even turn negative. That may be a long way off, as analysts still see a market shortage potentially continuing into next year, but it's a risk investors need to be aware of. ExpandNASDAQ: MUMicron TechnologyToday's Change(4.18%) $15.32Current Price$381.56Key Data PointsMarket Cap$413BDay's Range$370.61 - $385.0052wk Range$61.54 - $471.34Volume706KAvg Vol41MGross Margin58.54%Dividend Yield0.14% Is Micron's stock worth investing in today? There's been a recent pullback in Micron's stock as investors appear to be growing concerned with just how fast it has been rising. It's down more than 20% from its 52-week high of $471.34, but its valuation remains above $400 million, making it one of the more valuable tech companies in the world. Micron looks to still have more growth ahead, and there could very well be plenty of upside for its stock in the near future, given the relentless demand for storage and memory products. But given how much prices can affect its numbers, investors should tread carefully and keep an eye on market developments. If there are signs that the shortage may be ending, it could be time to offload the stock.Read NextApr 6, 2026 •By Rick OrfordWhere Will Micron Technology Stock Be in 5 Years?Apr 5, 2026 •By Adam SpataccoAfter a Monster Run, Is Micron Still Worth Owning?Apr 4, 2026 •By Geoffrey SeilerThis Growth Stock Is Down 20% in the Great Rotation. I Think That's a Mistake.Apr 4, 2026 •By Adam SpataccoIs Micron the New Nvidia?Apr 4, 2026 •By Keithen DruryDid Alphabet Just Say Checkmate to Micron?Apr 3, 2026 •By Keithen DruryThe High-Bandwidth Memory (HBM) Bottleneck Can Still Cause Micron's Stock to SoarAbout the AuthorDavid Jagielski, CPA, has been a contributing Motley Fool stock market analyst covering healthcare, consumer staples, consumer discretionary, and technology stocks since 2017. David has more than 10 years of experience in finance roles across businesses of different sizes and sectors. He holds a Certified Public Accountant designation in Canada.TMFdjagielskiStocks MentionedMicron TechnologyNASDAQ: MU$381.56(+4.18%)+$15.32*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.