Micron Soars After AI-Fueled Forecast Shatters Projections

Summary

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Bloomberg Intelligence Podcast Episode Summary

Episode Title: Micron Soars After AI-Fueled Forecast Shatters Projections

Date: June 25, 2026
Hosts: Paul Sweeney & Scarlet Fu
Key Guests: Jake Silverman (Bloomberg Intelligence Semiconductor Analyst), Michael Halen (Bloomberg Intelligence Restaurant Analyst), Matt Miller (Bloomberg Television Anchor)

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Episode Overview

This episode delves into the stellar performance of Micron Technologies, highlighting its AI-driven momentum, the implications for the semiconductor sector, and the broader market reaction. Additionally, it touches on Darden Restaurants’ latest earnings and Ford Motor Company's comeback driven by a blend of skilled human labor and strategic use of AI.

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Key Discussion Points

1. Micron’s Explosive Growth & AI-Driven Demand

Guest Analyst: Jake Silverman

• Micron’s Stock Performance

  • YTD up 300%, trailing 12 months up 800%, now a $1.3 trillion market cap company.
    “This is not a pink sheet... real money being made by investors here.”
    — Bloomberg Intelligence Analyst [02:18]

• Key Driver: Artificial Intelligence

  • Hyperscale capex is driving memory demand; long-term contracts are increasingly prevalent.
    “All of that is for the most part AI driven... memory is becoming an increasingly large portion.”
    — Jake Silverman [02:46]
  • Shift from AI training to AI inferencing increases “memory intensity” in data centers.
  • Micron secured $100 billion in revenue contracts out to 2030.
    “Micron talked about... $100 billion of revenue contracted, going all the way out... to 2030.”
    — Jake Silverman [03:11]

• Long-Term Revenue & Margins

  • 25% of revenue contracted, aiming for 50%. Floor pricing in contracts may lead to higher margins, even through downturns.
    “Floor pricing on those contract agreements, they’re talking about healthier margins than even the last cyclical peak, which would put it at north of 60% probably.” — Jake Silverman [04:00]

• Risks and Unknowns

  • 50% of business remains uncontracted, exposing risk if/when the cycle turns.
  • The pace of capacity expansion lags demand, keeping supply tight.

2. Industry Comparison: SK Hynix, Samsung, Western Digital, Seagate

• Performance Across Peers

  • SK Hynix (+925%), Western Digital (+980%), Seagate (+640%) also see extreme gains.
    “Is there any way to differentiate between these companies or do you just shut up and buy them all?”
    — Bloomberg Intelligence Analyst [04:59]

• Differentiators:

  • SK Hynix: Stronger HBM demand, greater Nvidia ties.
  • Samsung: Broader business, but memory is current focus.
  • Western Digital & Seagate: Storage, not memory, but benefit from duopoly dynamics.

• Floor Pricing and Memory Cycle

  • Memory is still considered cyclical, but structural changes like contracts/floor prices could moderate volatility and improve cash flow stability.
    “Instead of having tens of billions of dollars of cash burn, you might not see any cash burn at all...”
    — Jake Silverman [06:56]

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3. Darden Restaurants: Earnings & Industry Insights

Guest Analyst: Michael Halen

• Darden Q2 Results

  • Strong same-store sales (notably Longhorn and Olive Garden), but softer guidance for fiscal 2027 EPS.
    “All in all, it was a pretty good quarter. The issue would really be, you know, twofold... guidance came in light... sales are going to slow sequentially.”
    — Michael Halen [10:14]
  • Restaurants face tough year-over-year comps post-pandemic and increased competition from delivery services.

• Olive Garden’s Challenges

  • Not losing traction, but cycling strong results from previous year.
  • Darden expected to continue outperforming its peers, but broader industry slowdown underway.
    “Low income consumers are still strapped... restaurant sales here to start to decelerate over the next quarter.”
    — Michael Halen [11:40]

• K-Shaped Recovery & Consumer Trends

  • The sector reflects broader economic divides: quick service is overbuilt, full-service/casual dining benefits from better supply/demand dynamics.
    “Restaurants are very, very sensitive... canary in the coal mine for the economy in the United States.”
    — Michael Halen [12:51]
  • High beef prices narrow restaurant-grocery price gap, favoring steakhouse traffic.

• Labor & Immigration

  • Casual dining outperformed as quick-service faces oversupply and labor market tightens due to lower immigration.
    “Casual dining chains... have been shutting stores... quick service and fast casual chains... are overbuilt.”
    — Michael Halen [15:40]

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4. Ford’s Quality Comeback: Humans + AI

Guest Analyst: Matt Miller

• Bringing Back Skilled Labor

  • Ford “gray beard engineers” return to train younger employees and help re-tune AI systems.
    “That human motivation to pay attention to everything is amazing... these are American workers beating Toyota and Hyundai and are domestics who import their vehicles. We beat them all.”
    — Jim Farley (Ford CEO, via Matt Miller) [20:22]
  • Ford ascended from #15 to #1 in J.D. Power’s quality rankings among major automakers.
    “They were so far down... it's going to be a huge contribution to the bottom line.”
    — Matt Miller [21:08]

• Strategic Use of AI

  • AI remains important, but human insight is key: experienced engineers improve AI training.
    “We've brought back people who have real experience... they're also better able to train the AI because you've got to tell the AI what to do and if you don't know to start with, that's a real problem.”
    — Matt Miller [22:38]

• Electric Vehicle (EV) Strategy Pivot

  • Pullback from mass-market EVs after large losses; shifting battery production toward grid/data center storage, targeting hyperscalers.
    “...not aiming it as much at car batteries anymore as they are at giant data storage batteries... an unexpected tailwind for this company.”
    — Matt Miller [23:42]

• F-Series Truck Leadership

  • F-Series remains America’s bestselling truck line; Lightning EV model acts as a home backup generator but faces commercial viability issues.

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Memorable Quotes & Timestamps

• “All of that is for the most part AI driven... memory is becoming an increasingly large portion [of hyperscale capex].”
  — Jake Silverman [02:46]

• “Micron talked about... $100 billion of revenue contracted, going all the way out... to 2030.”
  — Jake Silverman [03:11]

• “Floor pricing on those contract agreements, they’re talking about healthier margins than even the last cyclical peak, which would put it at north of 60% probably.”
  — Jake Silverman [04:00]

• “Instead of having tens of billions of dollars of cash burn, you might not see any cash burn at all...”
  — Jake Silverman [06:56]

• “All in all, it was a pretty good quarter. The issue would really be, you know, twofold... guidance came in light... sales are going to slow sequentially.”
  — Michael Halen [10:14]

• “Restaurants are very, very sensitive... canary in the coal mine for the economy in the United States.”
  — Michael Halen [12:51]

• “That human motivation to pay attention to everything is amazing... these are American workers beating Toyota and Hyundai and are domestics who import their vehicles. We beat them all.”
  — Jim Farley, via Matt Miller [20:22]

• “We've brought back people who have real experience... they're also better able to train the AI because you've got to tell the AI what to do and if you don't know to start with, that's a real problem.”
  — Matt Miller [22:38]

• “...not aiming [batteries] as much at car batteries anymore as they are at giant data storage batteries... an unexpected tailwind for this company.”
  — Matt Miller [23:42]

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Notable Segments & Timestamps

• Micron’s Earnings, AI & Investor Sentiment: [02:10–07:23]
• Darden Restaurants & Industry Outlook: [09:56–16:53]
• Ford’s Quality Comeback & AI/Human Blend: [20:01–25:58]

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Takeaways

• Micron and broader semiconductor names have posted massive gains, with AI-driven data center demand fueling contract growth and higher margins. The sector faces questions over how cyclical volatility will be managed through these new long-term contracts.
• Restaurant industry performance signals a slowing consumer, especially among low- and middle-income brackets, with a split between oversupplied quick-service and healthier-supplied casual dining. Inflation and immigration continue to shape the sector’s fortunes.
• Ford’s operational resurrection is rooted in blending skilled human experience with revised AI tools, leading to a dramatic quality turnaround and strategizing away from mass-market EVs toward grid-scale batteries.

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This summary captures the episode’s energy, quotes, and market insights, offering a comprehensive update for investors and business observers alike.

Transcript

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[Bloomberg Intelligence Analyst]

earning season let's talk about it. Micron Technologies came out with some numbers last night. Stocks up 12% year today, but that's

[Jake Silverman]

not the good number.

[Bloomberg Intelligence Analyst]

The good number is year to date up 300% over the trailing 12 months up 800%. So and this is a $1.3 trillion market cap company, people, so there's some real money being made by investors here. This is not a pink sheet, which my next guest doesn't know what a pink sheet is, but it's not a pink sheet stock. Jake Silverman, Semiconductor Analyst for Bloomberg Intelligence Joints is here. What you hear from Micron last night Jake, that that that's got the market pretty positive here.

[Jake Silverman]

Yeah. I mean it's continued upward pricing momentum. All of that is for the most part AI driven. You know, I mean, look, we've seen healthy PC smartphone demand, but that's not the real story. Right. We're seeing hyperscale capex continue to grow at an incredibly high rate and memory is becoming an increasingly large portion of that. But it's really on pricing. Demand is strong because of AI buildouts.

[Bloomberg Intelligence Co-host]

Right.

[Jake Silverman]

We're shifting from an AI training environment to AI inferencing and that's just increasing the amount of memory you need in these data centers. The memory intensity is going higher. But then we're also seeing longer term contracts being signed by customers. They talked to Micron talked about 16 last night. $100 billion of revenue contracted, going all the way out in some cases to 2030.

[Bloomberg Intelligence Co-host]

Wow. So of course now the bar continually gets raised for a company like Micron. Was there anything sort of in the minutiae of this report that I don't know is maybe a mini red flag for Micron or for the greater industry?

[Jake Silverman]

Yeah, so it's, the interesting thing is, yeah, it's truly minutiae because I think Mark, the CFO mentioned ASC606 last night. Not something you typically hear on memory calls. But the interesting thing about this is they talk about floor pricing in some of these agreements. They, I think they have 25% of their revenue or bits contracted out, but they're talking about getting up to 50% or so of that demand getting contracted. Now that leaves another 50% that isn't potentially going to get contracted. So when we start to see a downturn, you know, the floor pricing on those contract agreements, you know, they're talking about healthier margins than even the last cyclical peak, which would put it at north of 60% probably, which is pretty.

[Bloomberg Intelligence Co-host]

So still an enviable position.

[Jake Silverman]

It's still enviable, but it's also a question mark is when does the downturn occur and what happens to the rest of the business that isn't contracted out and what are the margins on the floor pricing for some of those contracts? Anyway, there's a lot of question marks and a lot of unknowns and unfortunately we're just not going to really know near term. What, what's going to happen. It's too far out because capacity in the industry just can't keep pace with demand.

[Bloomberg Intelligence Analyst]

All right, Micron trailing twelve month stocks up. Micron trailing twelve month stocks up 825%. SK Hynix up 925%. Western Digital up 980%. Seagate Technology up 640%. Is there any way to differentiate between these companies or do you just shut up and buy them all?

[Jake Silverman]

Well, so the thing is SK Hynix, they have the capacity, they have a stronger HBM demand base because of the capacity and because of their history with Nvidia than Micron. Micron has about 20 to 25% DRAM market share, a little bit lower on NAND. SK Hynix has that capacity base, Samsung has that capacity base. But also if you look at Samsung, they have tons of other businesses. It's just that no one seems to care as much about them right now because memory is doing so well. But they have foundry business, they have smartphone, all sorts of supplies, they make

[Bloomberg Intelligence Co-host]

TVs, I mean they're all up in it.

[Jake Silverman]

And, and then you look at Western Digital and Seagate and they're, they're not even memory, they're storage. And you know, it's hard to differentiate but they have their own duopoly scenario going where they're the main players in that industry and they're not increasing capacity either. And so you have several different dynamics all going around. But how do you really differentiate between Hynix and Micron and sandisk? It's really difficult.

[Bloomberg Intelligence Co-host]

Did this report from Micron appease investors worries about the AI trade or is this just, is this going to be like a short lived situation?

[Jake Silverman]

I think what it really did is the reason I mentioned the floor pricing is because I think that was what investors wanted to know is will these contracts get renegotiated and take step down pricing when the cycle starts to turn? Assuming you still think these stocks are cyclical, which in my point of view I still think that memory is cyclical. It's just that we might see some structural changes in the way that the pricing volatility changes. It might just be less volatile and maybe even actually elongated. But it also might mean that instead of having tens of billions of dollars of cash burn, you might not see any cash burn at all in the industry. It could be razor thin in terms of free cash flow. But yeah, investors I think are looking at this and they're trying to figure out is this short lived, is this long term, are we going to actually see a real cycle play out, what's the length of that cycle? And I think the floor pricing and the more talk about contracts, how many customers, I think that starts to impeach some of the anxiety.

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So there's a lot of noise about AI. But time's too tight for more promises, so let's talk about results. At IBM, we work with our employees to integrate technology right into the systems they need. Now a global workforce of 300,000 can use AI to fill their HR questions, resolving 94% of common questions, not noise. Proof of how we can help companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business.

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[Bloomberg Intelligence Analyst]

We got some earnings out from Darden restaurants here today. Weak outlook? Apparently the Olive Garden sales outlook disappoints. Let's break it down with Michael Halen, senior Restaurant and Food Services Analyst for Bloomberg Intelligence. Mike, what'd you see from Darden with their earnings report?

[Michael Halen]

Yeah, you know it Was a pretty solid report. You know, they were able to drive pretty strong same store sales, especially at Longhorn. You know, they had a social media post go viral about the return of their parmesan crusted lamb chops. So all in all it was a pretty good quarter. The issue would really be, you know, twofold. Number one is their fiscal 27 guidance came in light on the EPS line. Right. This company is known to the guide pretty conservatively. So that, that could be what's going on there. And the other thing is, you know, sales are going to slow sequentially. So sales are going to slow sequentially for everyone because the restaurant industry had a very good summer last year. So now we have to lap those tough comps. We have tough base effects and especially so for Darden's brand. So Darden's brands had a nice boost last year from rolling out third party delivery with Ubereats. And now that they're going to lap it, especially Olive Garden, sales are going to slow.

[Bloomberg Intelligence Co-host]

So Michael, they also own Ruth's Chris Steakhouse. You mentioned Longhorn. But what is happening at Olive Garden? We know that they've been trying to get things back on track and they even were doing smaller portions. I think they're still doing that. That doesn't seem to be taking what, what's going on. Why can't they seem to gain traction with the consumer?

[Michael Halen]

Yeah, you know, I don't, I don't necessarily feel that that's the case. I mean they had same store sales that were pretty strong, you know, last year. Right. Like it's basically part of the issue is, is their own success. So last year Olive Garden had a pretty good year and now they have to lap those strong results. You know, we, we still think that Darden is gonna outpace most of their ca years, Olive Garden included. You know, but we see that this industry as a whole slowing this summer. You know, low income consumers are still strapped. Right. They've, they spent their higher tax refunds, you know, at the pump. And you know, we expect restaurant, you know, sales here to start to, to decelerate here over the next quarter. And you know, Olive Garden and Darden is not immune.

[Bloomberg Intelligence Analyst]

So what do you see, Michael? Just cross the board. You cover all these restaurants, you see, from the quick service restaurants all the way up to some of the higher end stuff. Is the K shaped economy apparent in the restaurant business as well?

[Michael Halen]

For sure, that's probably, we've been writing about it for several years now. We were probably the first industry to feel it and yeah, I'D say back, going back two plus years. We, we saw it. I think, I forget, maybe it was Chipotle who was one of the first to admit it because they didn't have that many low income consumers. So it wasn't going to impact them as much as some of their peers. But you know, yes, this is. Inflation really impacts the restaurant industry. Number one. It impacts low income and middle income consumer spending. Right. People have been spending way more at the pump over the last couple months than they had been. That takes money, you know, out of the, out of their wallet that could be used for restaurant visits. Restaurants are very, very sensitive. It really is a canary for canary in the coal mine for the economy in the United States. And low income consumers remain strapped. Low and middle income got a boost with these refund checks. You know, we expect that to be short lived and now we just have to, you know, face some tough comps. You know, I think it's, it's a tough time for restaurants. You know, low income consumers not getting better. And it's not going to until we see inflation get back down to that 2% or below.

[Bloomberg Intelligence Co-host]

Yeah, the margins are just so razor thin for so many of these restaurants. But did they say on the earnings call anything about beef prices? These high beef prices and the fact that consumers are still going to steakhouses. It seems like in droves, including tonight,

[Michael Halen]

steakhouses do pretty well in times of beef inflation. And part of that is, you know, the gap between what they pay at the grocery store and at the restaurants tends to close. Restaurants can sell different cuts of meat. Right. So they can be more particular and take advantage of movements of different cuts of meat. And so the gap actually shrinks when we see beef inflation. And so people will opt to get their steaks out at a restaurant. This year we're looking for more inflation. It's not going to be what we saw last year. So Darden was talking about some low single digit beef inflation. It's going to be higher in the first quarter, but then it's going to start to lap some really strong inflation in the back half of last year. And so for that reason, the chain is going to see less beef inflation. The entire industry is going to see less beef inflation as the year goes on.

[Bloomberg Intelligence Analyst]

I'm getting my New York strip tonight at Keen Steakhouse.

[Bloomberg Intelligence Co-host]

I passed Keens the other day and I thought of you. That's your favorite steakhouse in the city.

[Bloomberg Intelligence Analyst]

Right. Some boys are coming in from out of town.

[Bloomberg Intelligence Co-host]

Nice.

[Bloomberg Intelligence Analyst]

Where they want to go. So that's, we'll do that. Hey Mike, One of the industries singled out is potentially at risk from tighter immigration was the restaurant industry. Have you seen that? Does that come to fruition?

[Michael Halen]

Yeah, we have seen it. And you know, we were just, you know, we've been writing our mid year outlook and what we've been talking about is that casual dining in the first half of the year outperformed quick service restaurants in terms of their sales, in terms of valuation. They really have for the last year and a half. And so a big part of that is a better supply and demand balance. So since the pandemic, like right after the pandemic and for a while casual dining chains, full service sit down chains have been shutting stores. In fact they've been shutting them for 15 plus years since the Great Recession. And so but at the same time quick service and fast casual names, you know, for some reason this narrative came out that quick service was recession proof, as ridiculous as that is. And you know, people were building quick service and fast casual chains as fast as they could for the last five or six years. And now that part of the business is overbuilt, whereas casual dining has a better supply and demand imbalance balance. And so now that you know, immigration has declined, you know, these full service chains are just in a much better spot.

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[Bloomberg Intelligence Analyst]

Ford Motor Company took an unusually human approach to fixing its stubborn quality problems. It brought back what it calls gray beard engineers to help train younger staff and to reprogram the artificial intelligence tools that weren't getting the job done earlier. Bloomberg Television anchor Matt Miller spoke with Ford CEO Jim Farley on bringing back human inspectors.

[Bloomberg Intelligence Co-host]

That human motivation to pay attention to everything is amazing. Look, we make 85% of vehicles in the U.S. matt. That means these are U.S. factory workers versus even our domestic competitors. There's some of the biggest importers in the US we're not building these vehicles in South Korea or Japan. These are American workers beating Toyota and Hyundai and are domestics who import their vehicles. We beat them all.

[Bloomberg Intelligence Analyst]

All right, that was Ford CEO Jim Farley looking at ford stocks up 2.8% today, up about 8.4% year to date. Matt Miller joins us here. Matt, you had that interview with Mr. Farley. I was not expecting that story.

[Matt Miller]

What, that they were going to bring

[Bloomberg Intelligence Co-host]

back the gray beard?

[Bloomberg Intelligence Analyst]

I like it.

[Matt Miller]

Yeah. No, I think my demo. But I think, I mean, that's the most interesting part of this story, actually, the comeback. I told him, you're like Tiger woods winning the Masters in 2019. You're like, you're like Jordan winning a championship, you know, in 2026. Because they were so far down. They were 15th, ranked 15th in J.D. power's survey in 2023. And they're number one today among the major automakers. And this isn't. Somebody said, hey, don't you just buy those rankings? No, it's based on how many problems customers report per 100 vehicles. So you can't influence them other than doing a better job building cars or a worse job, obviously, if you want to go down. So it's not only an amazing comeback, but it's going to be a huge contribution also to the bottom line. Because what happens when you build crappy quality cars? They keep coming back for warranty work. You keep getting safety recalls and you have to spend a lot of money. And that was really a significant hit to Ford's bottom line over the last couple of years. They were losing a lot of money. Farley now says they're going to save hundreds of millions of dollars. And they're forecasting between eight and a half and ten and a half billion dollars in pre tax earnings this year. I could imagine that forecast getting upgraded at their next earnings because of this improvement in quality.

[Bloomberg Intelligence Co-host]

Are they doing it with more AI or less AI? Because when I hear about the human touch, I'm thinking, oh, I don't know, maybe they're doing this with like actual humans and not so much the technology.

[Matt Miller]

Yeah, I think, I mean, I asked him, is it technology, factory processes? Are you more closely monitoring your suppliers? Are you using AI? And he said, we're using AI, but this is really a human labor solution to the problem. We've, we've brought back people who have real experience. They're teaching our younger workers. They're also better able to train the AI because you know, you've got to tell the AI what to do and if you don't know to start with, that's a real problem. So I think at this point, when we're worried about taking human jobs, this

[Bloomberg Intelligence Co-host]

is refreshing to hear.

[Matt Miller]

It's a really refreshing thing to hear and it's really interesting as well. That they need some of those skilled workers back on the factory floor at the Rouge and other plants around, around the country.

[Bloomberg Intelligence Analyst]

What's the company saying these days? What's Mr. Farley saying about electric vehicles? Because this is an industry here in the US that kind of went aggressively at some point in time when it seemed like that's really where the world was going. They cost a lot of money, they lost a lot of money. Now they've kind of pulled back a little bit. Where's Ford?

[Michael Halen]

Right?

[Matt Miller]

I mean they lost almost $5 billion last year on EVs and they're fixing to lose another 4 billion this year. About. They've really pulled back from EVs and as an example, they built a battery factory in Marshall, Michigan with Catl, with a Chinese battery manufacturer. And they're. They're going to produce about 20 gigawatts of power a year there, but not aiming it as much at car batteries anymore as they are at giant data storage batteries. So these are going to be like the size of a shipping container. And if you're putting up like a gigawatt data center, you're going to need to buy like 40 or 50 of these things to hold power in case your original power source has a glitch or needs to get changed, changed over or whatever. They've already got a big deal with EDF of the US And I asked him, you know, are you making deals with hyperscalers like metal, like Google, like Amazon? And he said that's, you know, the direction that they're headed and they're really excited about it. That's an unexpected tailwind for this company and one of the reasons that their stock has outperformed every single competitor in terms of the major incredible all the way around.

[Bloomberg Intelligence Co-host]

An incredible comeback story. Is the F150 still the best selling

[Matt Miller]

truck in the U.S. well, the F series, it's important to say the F series because that encompasses the F150, 2503-504506-50750.

[Bloomberg Intelligence Analyst]

Like all, all.

[Bloomberg Intelligence Co-host]

They have an EV as well, don't they?

[Matt Miller]

They're the Lightning.

[Jake Silverman]

Yeah, Lightning.

[Matt Miller]

Paul and I both have driven it.

[Bloomberg Intelligence Co-host]

Paul.

[Jake Silverman]

Yeah.

[Matt Miller]

What do you think?

[Bloomberg Intelligence Analyst]

Which is crazy.

[Bloomberg Intelligence Co-host]

Also be a backup generator for your home.

[Bloomberg Intelligence Analyst]

It can do anything.

[Matt Miller]

It can, it can. In fact, you can switch it over your home over. The average home I think can run fully for like three days on that. But that's another project from which they've really pulled back substantially. I mean it was a, it was a fun car to drive, but it was a it was a money loser for them and the depreciation hit is horrible for anyone who actually bought one for full price. The point is, they are the biggest seller of American trucks in terms of the F series nameplate. It sells more than Sierra. It sells more than Silverado, although if you were to combine GM Silverado, Chevy Silverado and GMC Sierra, then they actually outsell the F series.

[Bloomberg Intelligence Host]

This is the Bloomberg Intelligence Podcast, available on Apple, Spotify and anywhere else you get. Your podcasts listen live each weekday 10am to noon Eastern on Bloomberg.com, the iHeartRadio app, TuneIn, and the Bloomberg Business App. You can also watch us live Every weekday on YouTube and always on the Bloomberg terminal.

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