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Micron Technology (MU) heads into its next earnings report with a labor dispute in Taiwan, adding a new risk for investors. Two unions representing about 10,000 workers at the company’s Taoyuan and Taichung facilities want changes to Micron Technology’s bonus system. In an August survey, more than 80% of participating union members supported strike action. However, the workers have not yet formally approved a walkout.
The dispute matters because Taiwan produced most of Micron Technology’s DRAM output in 2025, making these facilities important to the company’s global memory supply. At the same time, demand for AI servers, high-bandwidth memory, and data center DRAM has pushed the business higher. MU stock has gained about 243% this year, while fiscal third-quarter revenue rose to $41.46 billion from $9.3 billion a year earlier.
So far, Wall Street appears to view the dispute as a risk to watch, not a reason to give up on Micron Technology’s AI-driven growth story. But can Micron resolve the conflict before the labor dispute turns its biggest growth engine into a serious supply chain test? Let’s take a closer look.
Why Workers in Taiwan Are Escalating
Two unions representing about 10,000 of Micron Technology’s 15,000 workers at its Taoyuan and Taichung fabs threatened to strike on Sept. 1. An internal August survey found that more than 80% of participating members were willing to walk out. The unions want a one-time fiscal 2026 bonus equal to roughly 83 months of pay. Starting in fiscal 2027, they also want Micron Technology to replace its Incentive Pay Plan with quarterly profit-sharing payments funded by 15% of operating profit.
The unions say Micron Technology workers should share more directly in the company’s strong profits. They have pointed to South Korean rivals Samsung Electronics (SMSN.L.IX) and SK hynix (SKHY), which have profit-sharing plans, arguing that the pay gap between Taiwanese and Korean chip workers has widened during the AI boom.
Micron Technology’s response has been to engage employees through its “existing channels” and promise its biggest-ever bonus this year. The company also offered NT$1 million, or about $31,500, in cash and a broader package worth at least NT$1.7 million per employee. However, the Taoyuan union rejected the offer, saying it did not address the demand for a clear, permanent profit-sharing system.
Mediation broke down on Sept. 4, and union chairman Jerry Lin set a deadline. If Micron Technology does not bring a concrete proposal to meetings on Sept. 18 and Sept. 21, the union plans to hold a formal strike vote. With Micron Technology’s record profits supporting rewards for more than 60,000 workers worldwide, the chipmaker's employees want more than a one-time payment. They want a permanent share of the company’s profits.
Micron’s Earnings Engine Remains Strong
Micron Technology posted record fiscal third-quarter results on June 24 as demand for AI-related memory chips stayed strong. Revenue reached $41.46 billion, up 74% from the prior quarter and 346% from $9.30 billion a year earlier. GAAP net income was $28.24 billion, or $24.67 per diluted share.
Adjusted gross margin hit a record 84.9%, while adjusted EPS came in at $25.11 and operating cash flow reached $25.39 billion. DRAM was the biggest contributor, generating $31.3 billion, or 76% of total revenue. NAND revenue nearly doubled from the prior quarter to $9.9 billion. For fiscal Q4, Micron Technology expects about $50 billion in revenue, an adjusted gross margin near 86%, and adjusted EPS of roughly $31, subject to its guidance ranges.
Micron Technology is also investing in its supply chain outside Taiwan. In July, it invested in Taiwanese wafer maker GlobalWafers to support a new chip plant in Sherman, Texas. The move is part of a broader plan to invest up to $3 billion in the U.S. semiconductor supply chain. Locking in wafer supply could help Micron Technology avoid future shortages as demand for AI memory keeps growing. It will not solve any immediate production issues from the labor dispute, but it gives the company more supply-chain flexibility over time and could support continued earnings growth for MU stock in 2026.
Wall Street Weighs Risk and Reward
Micron Technology is set to report fiscal fourth-quarter results after the market closes on Sept. 30. Analysts expect adjusted earnings of $31.17 per share for the August quarter, up 989.86% from $2.86 in the same quarter last year. For fiscal 2027, Wall Street expects earnings to reach $158.01 per share, which would be a further 116.66% increase from the fiscal 2026 estimate.
That bullish view also shows up in recent analyst calls. Bernstein analyst Mark Li said in late June that Micron Technology’s valuation still looked attractive. He expects standard DRAM and high-bandwidth memory prices to stay strong and set a $1,300 price target, arguing that the memory upcycle still has room to continue. Bank of America analyst Vivek Arya kept a $1,550 target in August, pointing to strong demand for AI memory, improving free cash flow, and limited industry capacity.
The broader Wall Street view is also positive. The 41 analysts surveyed by Barchart rate MU stock a consensus “Strong Buy.” Their average price target of $1,476.64 suggests 51% upside from MU’s recent trading price.
Conclusion
Micron’s Taiwan labor dispute is a genuine risk, especially because the facilities involved sit at the heart of its DRAM supply chain. Still, the issue has not yet become a strike or a confirmed production disruption, while Micron’s underlying AI-driven demand, HBM opportunity, memory pricing, margins, and cash generation remain exceptionally strong. My view is that MU shares are more likely to trend higher over the medium term if management reaches a workable agreement before a walkout occurs. In the near term, however, the stock could remain volatile as investors watch the Sept. 18 and Sept. 21 talks closely.
