Everyone's treating Micron's $134B in contracted orders as a floor under memor… · @Leoskie_L · TwKit

@Leoskie_L

Everyone's treating Micron's $134B in contracted orders as a floor under memory stocks, no matter how hard they sell off. Here's the thing: that $134B was calculated at floor prices to begin with. And only about a quarter of it lands in the next year. This comes straight from the 10-K Micron filed with the SEC on Oct 9. As of the Sept 3 fiscal year-end, remaining performance obligations (signed but not yet delivered) were about $134B. At the previous quarter-end, May 28, the same line was $5B. That's almost 27x in one quarter. The good half first. These are take-or-pay contracts. Volumes are locked, and customers pay whether they take delivery or not. Some run all the way to 2031. Customers signing terms like that are scared of not getting supply, not of buying too much. It's why I keep saying memory looks more like infrastructure now than the old boom-bust cycle stock. Now the half to be careful with. The $134B is committed volume times minimum price. The 10-K says outright that the number is not a forecast of future revenue. On the earnings call, management said actual revenue will be well above it. Both are true. A floor is a floor, not a forecast. Timing. The 10-K says roughly a quarter gets recognized in the next 12 months. That works out to about $33.5B. Micron's full FY2026 revenue was $133.2B. So the contract-locked piece of next year is roughly a quarter of a year's revenue. The rest still rides on the market. Deposits. Customers paid $12.75B in deposits this year, and contract liabilities on the balance sheet sit at $13B. Per the 10-K, almost all of it gets paid back to customers in 2029 to 2031. And that cash shows up in financing cash flow, not free cash flow. Think of a landlord who signs a five-year lease and collects a huge deposit up front. The deposit lets the landlord sleep well. But it isn't rent, and it goes back at the end. The real income is still the monthly rent. One footnote: the $150B I cited on Oct 1 was management's "to date" number, which includes contracts signed after quarter-end. The Sept 3 balance-sheet figure is $134B. Neither is wrong; they're measured at different dates. Micron closed Friday at $878.84, about 20% off its Oct 1 high. Contracts can lock in volume. They can't lock in the stock price. $MU #Micron #HBM #memory

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