Micron Just Dropped 13%. Why One Analyst Says This Selloff Changes Nothing

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Shares of Micron Technology (NASDAQ:MU) have been the subject of intense debate this week after a roughly 13% sell-off rattled holders ahead of the company’s fiscal Q3 2026 earnings, scheduled for release today, June 24, after the market close. On CNBC’s Morning Call, Kevin Cassidy, Senior Research Analyst at Rosenblatt Securities, made the case that the pullback is due to “investor jitters” rather than a fundamental break in the memory cycle.

Even after the 13% drop on Tuesday, June 23, MU last traded at $1,071.99 as of June 24, 2026, up 40.05% over one month, 268.68% year to date, and 763.64% over the trailing year. Five-year gains sit at 1,238.55%. The selloff is real, but so is the run that preceded it.

The Bull Case: Supply Discipline Is Keeping Memory Profits High

According to Cassidy, the selloff was driven in part by weakness in Korean rivals Samsung and SK Hynix, which he characterized as investor jitters rather than evidence of deteriorating fundamentals. He argues that in a supply-constrained memory market with strong AI-driven demand, owning the memory names is the right trade, and profitability, not market-share grabbing, will be the dominant force for value creation.

Cassidy says Micron is comfortable with its roughly 25-30% market share and is prioritizing margin expansion over volume. He pointed to the company’s phased capacity roadmap as evidence: new fab capacity coming online in Idaho in 2027, a second Idaho fab in 2028, and mega fabs in upstate New York in 2030. Each step is deliberate, designed to avoid the overbuild that crushed the industry only a few years ago.

That memory of pain is central to his argument. Cassidy referenced the dramatic recovery from roughly negative 9% gross margin three years ago, which he says taught the industry not to overbuild. The behavioral shift, in his view, is what makes today’s cycle structurally different.

Why Gross Margin Could Decide Micron’s Next Move

The single number analysts are watching with Micron’s earnings tonight is gross margin. He expects guidance for about 84%, up from roughly 81% this reporting quarter. That tracks the trajectory Micron set in its fiscal Q2 report on March 18, 2026, when the company posted revenue of $23.86 billion (+196.3% YoY), non-GAAP EPS of $12.20, and a GAAP gross margin of 74.4%. Q3 guidance called for revenue of $33.5 billion plus or minus $750 million, non-GAAP EPS of $19.15 plus or minus $0.40, and gross margin around 81%. CEO Sanjay Mehrotra at the time told investors the company expects “significant records again in fiscal Q3.”

What the Market Is Pricing

Prediction markets and Reddit sentiment paint a split picture. Polymarket assigns a 96.1% probability to an earnings beat tonight, yet only a 53.5% probability that MU closes above $1,000 by month-end. Crowd consensus expects an earnings beat but a slower price recovery.

Reddit conviction tells a similar story. Sentiment scores on r/wallstreetbets and r/investing climbed as high as 81 (very bullish) on June 22, even after the selloff began. One widely upvoted post on r/options noted that “MU is pricing in some insanely abnormal panic”, drawing 136 upvotes.

What to Watch with Micron’s Earnings Tonight

The biggest number to watch in Micron’s earnings report is gross margin. Cassidy expects guidance to rise toward 84%, up from roughly 81% this quarter. If Micron delivers that level of margin expansion, it would support the argument that supply remains tight and the recent selloff was driven more by investor nerves than weakening fundamentals.

Investors will also be watching for updates on high-bandwidth memory (HBM) demand, progress on the Idaho and New York fab projects, and management’s outlook for capital returns following last quarter’s 30% dividend increase. By the end of tonight’s call, investors should have a much clearer answer as to whether this week’s pullback was a buying opportunity or the start of a more meaningful reset.

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