マイクロン（MU）2026年度第4四半期決算説明会：メモリー供給は2028年まで逼迫

主要なポイント

• マイクロンは、2027年度の出荷量の75%以上が確定しており、顧客との割り当てに関する協議を2028年にシフトできるようになっていると述べました。
• 経営陣は、AI需要、クリーンルームの制約、ノード移行による効果の減少、およびHBMのより高いウエハ換算比率を要因として、メモリの需給逼迫が2028年まで続くと予想しています。
• マイクロンは当四半期中に10件の新たな戦略的顧客協定（SCA）を締結し、DRAMとNANDを合わせた累計件数は26件となりました。
• 2027年（暦年）のHBM価格は大幅に上昇しており、年初に改定される予定で、従来のDRAMとの収益性ギャップの縮小に寄与します。
• 経営陣は、価格上昇とより有利な製品ミックスに支えられ、立ち上げコストによる一部の相殺はあるものの、2027年度第1四半期以降、同年度の残りの期間でマージンが拡大すると予想しています。
• 2027年度の建設関連設備投資の増加分の大部分は、2028年（暦年）後半以降のクリーンルーム稼働開始の前倒しに向けられます。

主要財務データ

事業および業績の動向

HBMは引き続きマイクロンのAI戦略の中心です。経営陣は、2028年までHBMの出荷成長率が従来のDRAMを上回り、業界全体の生産能力におけるHBMのシェアが高まると予想しています。マイクロンは固定的な割合を目標としているわけではありませんが、同社のHBM市場シェアは全般的なDRAMシェアと同水準を維持すると見込んでいます。

マイクロンはカスタムHBM4E製品である「NV HBM」について、1年以上にわたりエヌビディアと共同開発を進めてきました。この共同設計製品にはファウンドリプロセスが使用されます。経営陣は、電力効率、速度、営業利益率、および製品品質を中心に差別化が図られると期待しています。

モバイル分野では、ビット出荷量は前四半期比で減少したものの、価格上昇と好調な製品ミックスにより売上高は増加しました。マイクロンによると、プレミアムPCやフラッグシップスマートフォンでは、出荷台数が減少しているものの、引き続きより大容量のメモリとより高パフォーマンスなソリューションが求められています。

マイクロンは、同社の1-gamma（1γ）DRAM技術がすでにビット出荷の大半を占めており、同社の歴史上最大のノードとなる位置付けにあると述べました。次世代の1-delta（1δ）プロセスは開発中であり、来年後半の量産拡大を目指しています。経営陣は、マイクロンが中国の競合他社に対して少なくとも2世代以上の技術ノードで優位性を維持していると述べました。

NANDに関して、経営陣は市場全体の逼迫状況が続くなか、2027年および2028年（暦年）の業界のビット出荷成長率は20%台半ばで推移すると予想しています。マイクロンの第9世代（Gen 9）の量産拡大によりコスト効率の高い供給が可能となり、シンガポールの新しいクリーンルームは2028年（暦年）後半に稼働開始する予定です。

経営陣の見通し（ガイダンス）

経営陣は、2027年度の残りの期間において、同年度第1四半期と比較してマージンが拡大すると予想しています。主な要因は、より緩やかなペースではあるものの継続的な価格上昇と、マイクロンの技術および製品ポジショニングに基づく製品ミックスの改善です。立ち上げコストにより一部相殺される見込みです。

2027年度第1四半期について、マイクロンのガイダンスはDRAM、NANDともに前四半期比で1桁台のビット成長を前提としています。

2027年（暦年）のHBM価格設定は大幅に引き上げられ、年初に改定されます。経営陣は、これによりHBMと従来のDRAMとの収益性ギャップが縮小するはずだと述べました。

インセンティブ報酬の影響を除き、マイクロンが開発活動を拡充するに伴い、2027年度の研究開発費は前年度比で10億ドル以上増加する見込みです。

リスクと注視すべき分野

クリーンルームの生産能力は依然として業界全体の供給における主要な制約要因となっています。経営陣は、新規施設がウエハ生産を開始した後であっても、本格的な出荷までにはさらに数四半期を要すると述べています。

生産に占めるHBMの割合の上昇も、従来のDRAM供給を制約しています。HBM3EからHBM4、さらにその後のHBM4Eへの移行にはより高いウエハ換算比率が必要とされる一方で、より新しいプロセスノードによるビット成長の恩恵は減少しています。

同社は、関連するクリーンルームが生産を開始する前に建設支出を増加させています。マイクロンは、需要の推移に応じてのみ設備を導入し生産能力を追加する計画であり、SCAを活用して顧客の要件や潜在的な資本リターンを評価しています。

価格設定、製品ミックス、およびプレミアム機器における大容量メモリ搭載による売上高の支えがあるものの、モバイルおよびクライアント分野の出荷台数は引き続き圧迫されています。

アナリスト質疑応答のハイライト

2028年までの需給バランス：経営陣は、AI需要の拡大、CPU駆動型のエージェントワークロード、および限られた供給により、市場がいつ均衡に戻るかについての見通しが低下していると述べました。2027年度の出荷量の75%以上がすでに確定しています。

長期的な顧客協定：最新のSCAには複数の価格設定構造が維持されています。定義されたフレームワークの大部分は下限・上限バンドを使用しており、より新しい協定には現在の高い価格設定と市場の逼迫継続に対する期待が反映されています。

アクセラレータ以外のAI需要：マイクロンは、CPU上で実行されるエージェント型AIワークロードにより、DDRメモリ、低消費電力メモリ、およびSSDの需要が増加していると述べました。経営陣は、DRAMの供給能力がデータセンターのコンピューティング導入における主要な制約要因であるとみています。

設備投資：2027年度の建設支出の増加分の大部分は、2028年（暦年）後半以降のクリーンルーム稼働開始を前倒しすることを目的としています。マイクロンのアイダホ施設は2027年（暦年）半ばに最初のウエハを生産する予定ですが、本格的な供給にはさらに数四半期を要する見込みです。

潜在的な需要の可能性：経営陣は、顧客が利用可能なメモリに基づいてコンピューティングの出荷量を最大化していると述べました。追加のメモリ供給が実現すれば、アクセラレータベースおよびCPUベース双方のAIワークロードにおいて、システムあたりのメモリ搭載量のさらなる増加を後押しする可能性があります。

決算説明会トランスクリプト全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Hello, everyone. Thank you for joining us, and welcome to Micron's Fourth Quarter Post-Earnings Analyst Call. After today's prepared remarks, we will host a question-and-answer session. [Operator Instructions] I will now hand the conference over to Satya Kumar, Corporate Vice President, Investor Relations and Treasury. Satya, please go ahead.

Satya Kumar

Thank you, and welcome to Micron Technologies Fiscal Fourth Quarter 2026 Post Earnings Analyst Call. On the call with me today are Manish Bhatia, President and Chief Operating Officer; Dr. Scott DeBoer, President and Chief Technology and Product Officer; and Mark Murphy, our Chief Financial Officer.

As a reminder, the matters we're discussing today include forward-looking statements regarding market demand and supply market trends and drivers and our expected results and guidance and other matters. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from the statements made today. We refer to the documents that we filed with including our most recent Form 10-K and upcoming 10-Q for a discussion of risks that may affect our results.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements to confirm these statements to actual results. We can now open up the call for Q&A.

Operator

We will now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Ben Reitzes from Melius.

質疑応答

Benjamin Reitzes

Congrats on the promotion, Scott, I'm not sure if Manish is on, but congrats. So I wanted to ask about Congrats. So wanted to talk about 2028, new commentary here regarding and you guys felt compelled to kind of say you see things tighter in '28 than this year as well as '27. I wanted to know a little bit more about what changed and what that means for margins. You gave more margin commentary than you usually do around '27, which was great, by the way. but I just don't see any reason why margins would change in '28 from the level you implied for '27. So just a little more comment around '28 would be great.

Manish Bhatia

Sure, Ben. I can start, and then if Mark wants to add anything, and thank you for the shout out. In -- in terms of 2027 and 2028 in our commentary, we are seeing stronger demand drivers than we've seen before. We commented about the server units continuing to grow into '27. And of course, I think everybody is talking about how agentic AI is really growing fast, and that's creating a CPU-driven demand stream as well. And so as we've gone through working on our fiscal year '27 and we commented that we have more than 75% of our shipments committed for the year that shows a strengthening demand and allows us to shift our conversations on allocation with our customers out to 2028.

And so that's one element of our confidence is that '27 is shaping up with stronger demand than maybe we had seen before. And then, of course, as we also have now more SCA conversations with customers, including extensions that we've now negotiated that gives us more confidence in the long term as well. And so the combination of those two things is a very strong outlook for demand through 2028.

And then on the supply side, there's still the same structural constraints on supply growth that we've talked about before, which is diminishing returns from technology transitions versus past technology transitions. HBM growing faster than conventional DRAM through 2028, which means that as a portion of the industry's output capability, HBM is growing in terms of that share. And of course, the trade ratio, not just today's trade ratio for HBM, but future more complex HBM having higher trade ratios that's also going to be constraining supply.

And then it just takes a long time for these new clean rooms that the whole industry is working on to be able to build and then qualify and then equip and it takes -- even from the time they open, it takes a few quarters for meaningful shipments to come. So that really gave us the combination of that demand outlook and this supply outlook. We made the statement that we really don't have line of sight to when supply and demand balances.

Mark Murphy

Yes, Ben, I would maybe just add to Manish's comments that as you noted in '27, we had indicated for the balance of the year that we would see margin expansion relative to Q1 a function of continued price increases, albeit at a more moderate pace. And we've said that for some time that eventually price increases would moderate. And then at that point, in addition to just price increases at a lower rate, we would -- we have a better mix of products, and we would work our mix based on our technology and product leadership.

And the market conditions, as we said, we would expect to remain tight, and that would be supportive through '28. And of course, the partial offset to price and favorable mix would be start-up costs. But these are all things we're managing. We've been managing them, and we would expect to be able to sustain strong financial performance.

Benjamin Reitzes

Great. And if I could just sneak one other in. I mean, Sanjay had a great seat at the Trump, I guess, launch dinner, whatever, lunch. And just wondering, did you come away feeling good about the industry's ability to grow and self-regulate and the future coming out of that meeting, did that lend a hand any of the upbeat guidance he gave? Or just any color out of that and how we felt coming out and even if memory came up a lot at the meetings.

Manish Bhatia

Well, Ben, Sanjay is not here, but I'll give you what conversations I mean, for sure, we're very happy to participate in that forum. And it does show the importance of memory that Micron was invited there along with the model companies as well as the accelerator companies. I think that the framework that in the white paper or the -- that was published out of that, that many of the model companies have already signed is that, that framework is constructive towards continuing to have advancement in AI infrastructure and AI, in particular, AI hardware infrastructure.

And I know that one of the concepts that got discussed quite a bit was that the way to manage some of the security aspects is to actually have security solutions, which will require more advanced hardware, including higher performance memory, lower latency memory, as part of those security solutions, higher bandwidth memory because if you can imagine, setting up a gateway to be able to manage much of the security aspects that could be proposed in the future, those -- the responsiveness of those gateways are going to depend a lot on the availability of performance and low latency members.

Operator

Your next question comes from the line of Melissa Weathers from Deutsche Bank.

Melissa Weathers

My congrats as well to the 2 new promotes. On the -- and -- in past quarters, you've given us a view on where you think the HBM total TAM could be by 2028, 2030. Clearly, the pricing environment has changed since those updates. I don't know if you want to give us an official new number for where you think HBM TAM could go. But like directionally, can you help us sort of try to size like how much is coming from bets and how much is coming from pricing? And just any updated views on how big you think that market could be?

Manish Bhatia

Sure, Melissa, thank you again. We are not updating that TAM outlook right now. But what we have said is that HBM shipments, we expect to grow faster than conventional DRAM. That means that HBM will continue to gain -- to grow as a portion of the industry's capacity year through 2028. And the pricing for HBM, at least for us, we did comment that we have increased that pricing significantly for calendar year '27, which will reset at the beginning of the calendar year to narrow the profitability gap with conventional DRAM. But beyond that, we haven't made any comments on the specific outlook for the HBM TAM. It continues to grow, it continues to be a very important enabler. HBM deployments continue to be an important enabler of much of the rest of the to be able to reach its potential as well. So it's an important part of the market.

Melissa Weathers

Got it. Maybe following up on that, from a market share perspective, any updated view on how you guys are targeting market share for HBM. In the past, you said you want to get it to within the corporate average, kind of low 20s present market share. So is that still the case? And then I noticed in the prepared remarks, your comments on HBM 4E and the engagements with NVIDIA there. So just any more color on 2027 and HBM 4E the progress that you're making there with customers would be great. .

Manish Bhatia

Sure. Sure. I'll take the first and then maybe Scott can take the HBM 4E since his team is driving that product development. In terms of the HBM market share, about a year ago, we had achieved the milestone that we talked about that our HBM market share reached our broader DRAM market share. And at that time, we said that our goals would then move around based on various different factors. And we haven't really updated exactly our HBM share target other than to say that we do expect our HBM share to be around our broader DRAM market share, but we're not necessarily targeting 1 number or the other. It will move around based on various different factors there. But as I mentioned on the prior question, it's a really important part of the market. It allows us to be very close to the leading edge of the accelerator platforms that many of our customers are designing and then deploying, and it's a key enabler for all the rest of AI to be able to deliver on its promise and its potential.

Scott DeBoer

And then I can just add a little bit about the work with NVIDIA on what really will be the first major custom HBM product out in the market. And we've been working with NVIDIA for over a year on HBM 4E, what's called NV HBM. And we see substantial opportunity there for us in the co-design of that product with obviously a key customer to have this be a product that delivers really substantial value beyond standard HBM 4E. And I think it will be a real impact on industry showing where future system with optimized.

Operator

Your next question comes from the line of Atif Malik from Citi.

Atif Malik

The first one on the 26 35% of sales by 2030. Are these for both DRAM and NAND? And if you can just split them out?

Manish Bhatia

It, we're not splitting those out, but the SCA agreements do cover both DRAM and NAND. And it is through 2030, but we're not breaking it out specifically. I can tell you that the DRAM volume is a little bit less than that, approximately 35% and the NAND bit volume is a little bit more. And as we think about these going forward, we are -- we have more availability. As we said, that this number could get up to be higher in the future as we continue negotiations for SCA.

Atif Malik

Understood. And then on the impact of China competition, firstly, if you can confirm that your China sales exposure is fairly minimum. And if Scott can comment on how should we see kind of China competitors kind of closing the gap on technology? If you can provide any color?

Manish Bhatia

So on the first question, Yes, our exposure to China has been reducing over the last couple of years in the last several quarters, and we expect the exposure will be in the single-digit range in fiscal '27.

Scott DeBoer

Then I could comment a little on the technology side. Currently, our technology leadership is at least 2 nodes ahead of of the China competition. I think it's important to say that our focus is on maintaining technology leadership and having true differentiation in our products in how we compete. We're -- as Manish, I think, mentioned earlier and as it was mentioned in the call, our 1-gamma DRAM technology is already the majority of our bids, and it set up to be the largest node in the company's history. It is dependent on EUV technology. The next-generation One Delta is well underway and we're focused on the ramp of that in the second half of next year. EV technology is critical to all advanced DRAM nodes going forward. And our expertise in that, both from the technology side in partnership with our supplier there as well as mass technology and other things is -- continues to be a key differentiator for Micron.

Atif Malik

And then .

Manish Bhatia

Thank you, -- and can I just clarify that the response in terms of DRAM and NAND was actually a bit common just to make sure that, that was clear. I'm not sure I specified. So making sure it's clear. .

Operator

Your next question comes from the line of Karl Ackerman from BNP Paribas.

Karl Ackerman

Yes. Thank you, Tara. You are seeing robust demand across much of your portfolio, but this quarter does appear to the second quarter row that mobile and client segment saw bit shipments decline. Are higher memory prices reducing demand in this area of the market. And while this area of the market has been slow to adopt SCA, I'm curious if your growth in SCA is coming from this cohort.

Manish Bhatia

Thanks, Karl. We did see sequential bit decline in our mobile business unit, but we did see revenue growth, obviously, with both higher pricing and favorable mix. I think what's important to note is that the premium segments of the both clients as well as the flagship smartphones do see robust demand for higher content, higher performance solutions. And that's a segment that, of course, we're -- those are the segments that, of course, we're very focused on. And with that wind at their back, we see the PC and mobile industry revenue to be growing even though we do see unit volumes declining. And in terms of SCAs, I'll just comment that we do have SCAs across all of our business units, including the Mobile Client business unit. And we're not specifically breaking them out, but I will tell you that we have SCAs because it's important for us to be maintaining diversified supply to all our end markets.

Karl Ackerman

Got it. Yes. Maybe a question for Scott, if I could. How do you view the competitiveness of your in-house optimized base die on HBM 4E versus peers? Certainly, some of these customers are seeing custom solutions. Does the complexity and economic value flow primarily through the compute customers or the HBM providers?

Scott DeBoer

So maybe just a little clarification first. On HBM 4E, we have co-designed with NVIDIA, but not in-house-based like we use on HBM 4. So I think just to be clear on your question, I just wanted to be sure I was answering it in the right way. On HBM 4E, this codesign is on a foundry process, both for the customized product and for the say get specified product.

So the -- and then I think maybe to add a little color to that. The differentiation just as we have demonstrated in the past on HBM prior HBM products winds up being in the power and the ultimate speed performance and the margin of the product working with our customers. That, in all previous generations hasn't been the same between suppliers in that we think will continue to be a strength of Micron in terms of quality of the product and the capabilities that we're able to put out.

Manish Bhatia

And then in terms of your question on economic value, HBM is a premium product. And as Scott mentioned, as we look at the NV HBM with customization, we do expect that to be a high-value product as well. And we're confident that HBM will continue to contribute and be a strong ROI product for us.

Operator

Your next question comes from the line of Jim Schneider from Goldman Sachs.

James Schneider

Congratulations, Manish and Scott. I just wanted to maybe get a sense about -- of the 10 new customer SCAs you signed in the quarter, maybe give us a little bit of color on what customers are asking for? Obviously, they want supply and they want longer-dated supply. But is there any kind of change in the pricing construct either you or they are asking for? Sort of given -- the reason I ask the question is kind of given the expectation about tightness through calendar '27 and '28. Are you maybe a little bit less inclined to call for the fixed ceiling and floor pricing if you think you can capture a little bit more upside over the next couple of years?

Manish Bhatia

Yes, yes. Well, thanks, Jim, and thanks for the shout out. I would say that the framework of the FCAs that we have is similar. But what's different is that the negotiations reflect current market conditions and outlook for market pricing, right? And so the direction of travel has been for higher pricing. And so those are now factored into the discussions that we're having with customers versus the prior ones, which we had talked about that were set at Q2 kind of market conditions. And as I think we gave color that about 3/4 of the SCA have this -- of the SCA revenue has a defined pricing framework in about 1 quarter is open to periodic negotiations or pricing that move with market dynamics.

Of the -- so I guess I would answer that in terms of the overall framework similarity. The majority of the pricing frameworks have floor and ceiling bands, but the newer ones are negotiated with an eye towards the current market conditions and the future market tightness that we see.

James Schneider

Got it. I mean just to be clear, does that mean all the pricing ceilings and floors just reset to the higher bucket conditions you're seeing today? Or is the nature of the pricing condition is actually different, too? And then maybe just to ask, just curious as to whether -- I don't think you've disclosed signing initial hyperscale customers. I'm wondering if those are included in the TAM.

Manish Bhatia

Yes. So I mean there are multiple different frameworks. What I commented on is that the majority of the framework that have pricing are set with floor and ceiling, but there are multiple different frameworks that we're continuing to use. And since the last call in these new 10, we've signed a range of agreements from small to large SCA customers.

We're not commenting specifically, even in the previous question, not specifically breaking out which one just commenting that we now have SCAs across all of our business units, and we have SCAs ranging from small to large, even in the last 10 that we signed. And of course, in the total 26.

Operator

Your next question comes from the line of Chris Caso from Wolfe Research.

Christopher Caso

I guess our first question, if you could address the CapEx and the fab construction CapEx, the construction CapEx as compared to the tool purchases. And what I seem to hear in the comments is that the construction CapEx was increasing faster. And I'm not sure I interpreted that correctly. But understand that there's the clean room space constraints are constraining the ability to bring in tools for this year. But the increase in construction CapEx is obviously interesting because it doesn't result in bit production until at least '29, probably beyond that.

Manish Bhatia

So Chris, I can start and then maybe Mark can add. But I mean, that's exactly right, is that the principal constraint in the industry is on clean room space because we -- the strong growth of AI in this demand vector has come on relatively recently in terms of the time line that it takes to build these clean rooms. So while we're all starting. That's why we're focusing there. And then -- you're right that we did comment that the majority of the construction CapEx increase for fiscal '27 versus our prior plans is for clean rooms that will come online in late '28 and beyond, which shows both how long it takes to build these clean rooms and why we need to get started with the construction investments now. But also shows our confidence in longer-term demand, both through the observation of the demand trends in the near term market trends that we're seeing as well as the structure of the SCAs and the discussions we're having with SCAs and customers now extending those commitments beyond 2030. I mean these SCAs are transformational for us in terms of being able to match supply with future demand and to be able to invest as confident.

Mark Murphy

Yes. Chris, maybe I can just add that just to make it clear that the majority of the increase is for construction CapEx. Most of that construction increases to accelerate clean room space availability in '28 and beyond. I mean it is a trend that we would expect to continue to beyond '27. And I think you made a very important point that just the spend there doesn't translate into bits and that these fabs will be made -- we put the equipment in the fabs and produce wafers when needed based on our view of the market and these SCAs are a good way for us to keep a pulse on the market and make sure that we get a return on that CapEx.

Manish Bhatia

And I can just a couple just 1 other point. One other point, Chris, is that we will equip the clean rooms and build capacity to the demand trends that we see. So that's just another important point. And we have been executing long-term supply agreements with equipment suppliers to be able to make sure we have access to equipment as needed. But of course, we'll still equip and build the production capacity in those clean rooms in line with demand trends at the time.

Christopher Caso

Of course. Okay. As a follow-up question, I want to ask a question on the impact of CPU strength. -- both overall bit demand and your view of supply-demand balance. And obviously, that's probably been the biggest incremental surprise since the beginning of the year. You don't have the same trade ratio effects on CPU as you do on HPM. But I guess the question is, how significant is that in contribution to the supply-demand imbalance?

Manish Bhatia

I think definitely, the realization that agent workloads are executed across CPU has been a big driver. There is a large attach rate of both LTE as well as DDR memory and SSD to enable those genic workflows. The -- those agenetic workloads are already starting. You're already starting to see multiple ones, whether in the enterprise or consumers implemented and driving real value. And that's been one of the reasons that server units are growing so strongly, as we noted, in the high teens. And I think the other thing that this shows is that while it's just another vector of logic and logic silicon to grow to be able to take advantage of the AI trends. And so that is driving higher logic silicon and into the overall demand for AI compute and frankly, creating more of a constraint on DRAM and making clear that DRAM is the principal constraint versus logic or power to the data center.

I mentioned the new -- there are many different software implementations for enterprise agentive workflows that we're all seeing. But seeing how quickly Meta's music just in the last couple of weeks since being released is just an example of how quickly the agenetic workloads are realizing -- enabling consumers to realize real value.

Operator

Your next question comes from the line of Joseph Moore from Morgan Stanley.

Joseph Moore

Great, in terms of supply growth decelerating next year, I guess that's a little surprising in the context of the CapEx. And I know you talked about some of the dampening effects of HBM, but I don't think that delta should be changing that much. So I just wonder if you could just kind of explain what the puts and takes are that supply would decelerate given the CapEx that you see.

Manish Bhatia

Sure, Joe. And you're asking for both DRAM and NAND?

Joseph Moore

Yes, but principally DRAM.

Manish Bhatia

Okay. I mean I think that we gave the color that HBM is growing faster than conventional DRAM. And the trade ratio as you move more of the industry is shifting formation of HBM 3E to HBM 4 and then towards later in the year in '27 HBM 4E and these are increasing trade ratio. So if you just look at both of those two things happening together, that has a dampening effect on the ability for bit growth to be growing. And keep in mind that both the bit growth for us and other industry participants from new technology nodes, both over time as you make more of your transition, you don't have the timing of transitions affect how much big growth you can have as well as the nature of the diminishing returns of each of those newer nodes.

So these are all the factors that are going to be constraining supply. But of course, the principal 1 is clean room space for everyone. And even though there's -- we're going to be having first wafer output from our Idaho facility mid-calendar '27 and others in the industry as well, maybe opening clean rooms, meaningful supply growth takes a few quarters after that. So I think that's really the -- those are all the reasons why we see that DRAM is reducing supply industry shipments next year.

Joseph Moore

Okay. That's helpful. And then to the extent that if you end up having been conservative on industry supply and there's more supply next year -- can you talk about -- I mean it seems like there's a lot of pent-up demand. There's a lot of appetite to have more supply. We've seen specking out of necessity for some of these AI RAC and things like that? It seems like they'll just respect to higher levels if there's more supply, but am I too optimistic there? Just how do you think about that?

Manish Bhatia

Yes. No, I think that's exactly the point that these are and Sanjay mentioned this on the main call, we definitely think that our customers are choosing to maximize the compute silicon shipments they can make with the available memory supply that they have. And as that does create latent demand for more memory to attach to those, which would then end up delivering higher system performance and improved performance at the end customers. But -- and so I guess that leading demand, I think, is aligned with your concept that where more memory to become available, it would have -- it would easily get put into use in higher content growth in AI workloads, whether attached to accelerators or CPUs.

Operator

Your next question comes from the line of Mehdi Hosseini from Susquehanna International Group.

Mehdi Hosseini

A couple of follow-ons for me. You did highlight your NAND bit shipment in is tracking below industry average. But what should we expect '27 through '28? Would you be able to be of the shipment in line with the industry average of 25%.

Manish Bhatia

Mehdi, we're not commenting out that far, frankly, on either DRAM or NAND. We do expect conditions to be tight on NAND overall even as the industry is expected to grow in the mid-20% range in calendar '27 and '28. Some of the factors that account for our supply growth, we did -- we are utilizing some of the clean room space in Singapore now for our advanced R&D line for future NAND growth. We are also preparing for the ramp of our HBM facility in Singapore next year. And so some of the existing clean room from pilot operations. And so that's some of the reasons why our supply growth grew less than the industry this year. But we feel confident in our technology, and we do expect that our continued ramp to Gen 9 will provide good, very high ROI, cost-effective supply for us as we move forward. And then, of course, we do have the new clean room that we broke ground on earlier this year that will come online in the second half of calendar year '28.

Mark Murphy

Mehdi, just maybe if I can interject just because of time here. And then if you've got additional -- well, why don't you start with your question and then second question, I'll make a comment after that. .

Mehdi Hosseini

Sorry, Mark. I didn't mean to interrupt you. But very quickly, I just want to get the team's opinion. When I look at DRAM, especially at the wafer level, the devices are all the same. And I argue that there is a fungibility of DRAM at the wafer level. And then there are some differentiation in the back end. And this fungibility at a wafer level hasn't been seen before because in the past, the cycles were driven by just one product, and there was a significant concentration of customers. So am I right with this assumption that fungibility of the DRAM at the wafer level gives you a better way of managing DRAM costs. Does that make any sense to you?

Scott DeBoer

Maybe start with 1 thing. I think there's a bit of what you say, but I actually probably would have gone the other direction. And if you look at the front end variability or what we do differently on the DRAM processes between optimizing for HBM, optimizing for high-performance EssoChem, LPDRAM and optimizing for DDR6. There's, at this moment in time, probably more different than ever in the history of DRAM. And the same node, the different kinds of products that we have to build on it and a lot more differentiation built into those. I don't know what you would add.

Manish Bhatia

Yes, I mean I would say that it really helps us with in the near term, the fact that we do run the different products in the same manufacturing lines, it does help us adjust mix. We don't have to run products in different fabs. We can run them on the same lines. But as Scott mentioned, each product has its own vector is trying to optimize. Obviously, in HBM, it's bandwidth with the TSVs and that requires unique process steps in DDR and LP, they each have their own as well process steps that are unique. And so I think the most important part of the fungibility is that we do have the ability to flex wherever demand is or even mix adjustments to try and meet our customers' requirements. I think that's probably the -- all within the same fab, that's probably the most important part. But I wouldn't say that it helps necessarily with cost.

Mark Murphy

Yes. I think, Mehdi, just I think we're at the end of the call. And I am really happy to hear the nature of the questions being focused on technology and the longer-term strong foundation and performance of the business. And I just -- I thought there'd be a question that let me just do a couple of housekeeping things. that I thought would come up earlier. Our first quarter guidance factors in a single-digit sequential bit growth and double-digit for cost for both DRAM and NAND and I wanted to make sure you had that for your modeling. And then also, excluding the incentive comp effects, the year-over-year R&D is going to be more than the $1 billion that we said last quarter, will be over $1 billion in '27 as we have added additional R&D activities. So again, I wanted to just make sure we got that out for your modeling.

Operator

This concludes the Q&A and today's call. Thank you for attending. You may now disconnect.