With stellar records in revenue, gross margin, EPS, and free cash flow. Micron Technology, Inc. delivered an exceptional fiscal Q2. Quarterly revenue nearly tripled versus one year ago, and revenue for DRAM, NAND, HBM, and each business unit reached new highs. Our fiscal Q3 single-quarter revenue guidance exceeds the full-year revenue for every year in our company's history through fiscal 2024. For fiscal Q3, we anticipate exceptional growth across revenue, gross margin, EPS, and free cash flow. Reflecting confidence in the sustained strength of our business, I am pleased to announce that our Board has approved a 30% increase in our quarterly dividend.
The step-up in our results and outlook are the outcome of an increase in memory demand driven by AI, structural supply constraints, and Micron Technology, Inc.'s strong execution across the board. Our memory and storage solutions are at the heart of this AI revolution. Memory makes AI smarter and more capable, enabling longer context windows, deeper reasoning chains, and multi-agent orchestration. As AI evolves, we expect compute architectures to become more memory intensive. This is why we strongly believe that Micron Technology, Inc. is one of the biggest beneficiaries and enablers of AI. AI has not just increased demand for memory; it has fundamentally recast memory as a defining strategic asset in the AI era.
We continue to work with customers on strategic customer agreements, or SCAs, that are different from prior LTAs and have specific commitments over a multiyear time horizon for improved visibility and stability in our business model. These SCAs also provide customers greater certainty to plan their businesses while reinforcing long-term engagement across our broad product portfolio. We are excited to have signed our first five-year SCA. We are making excellent progress ramping our industry-leading 1γ DRAM and G9 NAND technology nodes. We expect 1γ to become the highest-volume node in Micron Technology, Inc.'s history. Our 1γ node was already the fastest ramp to mature yields, is ramping volumes faster than all prior nodes in our history, and is on track to become a majority of our DRAM bit mix by mid-calendar 2026. We plan to increase EUV adoption at the 1δ DRAM node, utilizing the latest-generation EUV tools. These more advanced EUV tools will help us optimize both cleanroom space efficiency and patterning when scaling to 1δ and beyond. In NAND, our G9 node also remains on track to constitute a majority of bits by mid-calendar 2026. We also achieved a record mix of QLC bits in the quarter. Looking ahead, we expect colocation of R&D and high-volume manufacturing at our Boise and our Singapore sites to speed up time to market for our leading-edge products. We see an unprecedented set of opportunities in memory and storage to enable the AI era across market segments and expect to meaningfully increase our R&D investments in fiscal 2027. Micron Technology, Inc.'s technology leadership, product excellence, and manufacturing execution is being recognized in quality scores from our customers. I am pleased to report that a clear majority of our customers rank Micron Technology, Inc. number one in quality. Turning to our end markets.
AI demand is driving DRAM and NAND data center bits TAM to exceed 50% of the industry TAM for the first time in calendar 2026. Traditional server demand is robust, driven by a combination of demand from workloads initiated by agentic AI as well as broad-based server refresh. AI server demand continues to be strong. Both AI and traditional server demand are constrained by lack of adequate DRAM and NAND supply. We expect server units to grow in the low-teens percentage range in calendar 2026, driven by growth in both AI and traditional servers. We expect server DRAM content to continue to grow in calendar 2026 with the introduction of new platforms.
At NVIDIA's GTC, we announced that Micron Technology, Inc. has begun volume shipment of its HBM4 36GB 12-Hi in 2026 and is designed for NVIDIA Vera Rubin. With our HBM4 production ramp and volume shipments underway, we expect to reach mature yields faster than HBM3E. We have also sampled our HBM4 16-Hi product, which provides 48GB of HBM capacity in each HBM, a 33% increase in the HBM capacity compared to HBM4 12-Hi. Development of HBM4E, our next-generation HBM product, is well underway and we expect to ramp volume in calendar 2027.
Our HBM4E will leverage Micron Technology, Inc.'s production-proven industry-leading 1γ DRAM technology node and is set to deliver another step-function improvement in performance, enabling a whole new generation of AI compute platforms across the industry. Additionally, HBM4D customization options offer us further differentiation opportunities and even deeper R&D engagement with customers. Micron Technology, Inc. pioneered the development of LPDRAM for the data center, which consumes one-third the power of DDR DRAM server modules. Building on this leadership, we sampled the industry's first 256GB LP SoC-M2 product, which is built using our 1γ node and enables a massive 2TB of capacity per CPU, quadrupling the content from just a year ago. We see expanding use of LPDRAM in the data center in the years ahead, and we are excited to maintain an industry-leading innovative product roadmap in this market. Rapid growth in AI is driving the emergence of new architectures optimized for the token economics of specific workloads. Micron Technology, Inc.'s broad portfolio of HBM, LP, DDR, and SSD is a critical enabler across these architectures. At GTC, the recent announcement of NVIDIA Grok 3 LPX implements up to 12TB of DDR5 in a rack-scale architecture. We are seeing an acceleration in NAND-based demand in the data center due to AI use cases such as vector database and KV cache offload, and due to growing share of SSDs in capacity storage tiers. Micron Technology, Inc.'s data center SSD product portfolio, enabled by our technology leadership and vertical integration, covers the spectrum from highest performance to highest capacity. We are now in high-volume production of our G9 NAND-based PCIe Gen6 high-performance data center SSDs. Our 122TB high-capacity SSD is seeing strong adoption, and delivers 16 times the sequential read throughput per watt of a capacity-matched HDD configuration. Our strategy and execution are delivering results. Our data center SSD market share increased for the fourth consecutive calendar year in 2025 to a new record. In fiscal Q2, data center NAND revenues more than doubled sequentially, reaching a substantial new record, and we expect further growth in the quarter ahead. Micron Technology, Inc.'s data center SSD portfolio is industry-leading, and we have secured a robust set of design wins across our customer base. We are now seeing NAND demand significantly in excess of our available supply for the foreseeable future. In calendar 2026, a number of factors including DRAM and NAND supply constraints could cause PC and smartphone units to decline in the low double-digit percentage range.
Over time, we expect the value of on-device AI to drive strong memory content growth in PCs and smartphones. In PCs, there has been exciting innovation recently with agentic AI applications, such as OpenClaw, where AI agents can perform tasks independently on the host PC and also initiate workloads in the cloud. PCs with on-device agentic AI capabilities have recommended memory configurations of at least 32GB, twice as much as the average PC. Additionally, the fast-growing new category of personal AI workstation, such as NVIDIA DGX Spark and AMD Ryzen AI Halo, come in 128GB configurations, ideal for using large language models on device. Likewise, in smartphones, OEMs have recently announced new flagship devices such as Samsung Galaxy S26 and Google Pixel 10 with agentic AI integrated into their mobile operating systems. The mix of flagship smartphones shipping with 12GB or more of DRAM increased to nearly 80% in calendar Q4, up from under 20% a year ago.
Micron Technology, Inc. is well positioned to accelerate the opportunities in these markets with our industry-leading portfolio of products. In PC, Micron Technology, Inc. completed qualifications for LPCAM2 at a major OEM. In SSDs, we launched the industry's first Gen5 QLC client SSD, based on G9 NAND. Micron Technology, Inc.'s LPDDR5X is now designed into leading personal AI workstations, expanding our addressable market, with high volumes shipped to key customers. In smartphones, Micron Technology, Inc. continues to receive strong interest and feedback from OEM and ecosystem partners on our 1γ-based LPDDR6 samples. We built momentum with additional qualifications and mass production of our 10.7 Gbps 1γ LPDDR5X 16Gb product.
We saw continued pricing improvement across automotive, industrial, and embedded markets. Total AEBU's revenue reached a record, with automotive and industrial revenue together exceeding $2,000,000,000 in the quarter. In automotive, OEMs are deploying Level 2+ ADAS across their fleets at an accelerating pace. The average car today has less than L2 ADAS capability, containing approximately 16GB of DRAM, while vehicles with L4 autonomy require over 300GB. As more advanced ADAS and smart cabin adoption scales, we expect robust long-term growth in automotive memory demand. We have shared samples of the industry's first automotive-grade 1γ LPDDR5 DRAM, and in NAND, we were first in the industry with a G9-based UFS 4.1 automotive solution, further reinforcing our technology leadership in this market. Rapid improvements in AI are supercharging the capabilities of robots. We believe we are on the cusp of a 20-year growth vector in robotics and expect robotics to become one of the largest product categories in the technology world. Humanoid robots will be AI-enabled and will be powered by a compute platform that rivals that of a high-end L4-capable automobile, thus requiring significant memory and storage capacity. We expect this exciting new category of growth to further underpin the long-term favorable dynamics that shape our industry environment. Micron Technology, Inc. is very well positioned to leverage this opportunity in close partnership with our customers, enabled by our industry-leading technology, product solutions, and operational capabilities.
Now turning to our market outlook. We expect both DRAM and NAND industry bit demand in calendar 2026 to be constrained by supply. We continue to expect supply and demand for both DRAM and NAND to remain tight beyond calendar 2026. We expect industry DRAM bit shipments in calendar 2026 to grow in the low-twenties percentage range, slightly above our prior outlook. In DRAM, cleanroom constraints and long construction lead times, higher HBM trade ratio, higher HBM growth rates, and declining bits-per-wafer growth from node migration constrain bit supply growth. We expect industry NAND bit shipments in calendar 2026 to grow approximately 20%. In NAND, some industry suppliers redirect cleanroom space for DRAM, and overall limited cleanroom space constrains bit supply growth. We expect Micron Technology, Inc. DRAM and NAND supply to grow approximately in line with the industry in calendar 2026. Micron Technology, Inc. is working to address the unprecedented gap between supply and demand, and we achieved several important milestones in expanding our global manufacturing footprint this past quarter. In DRAM, earlier this week, we announced the successful closing of the acquisition of the Tongluo site from Powerchip Semiconductor, completing the transaction ahead of schedule.
We expect this site to support meaningful product shipments from the existing fab beginning in fiscal 2028. Adding to the existing fab, we plan to begin construction of a similar-sized second cleanroom at this site by 2026. We continue to expect initial wafer output at our first Idaho fab in mid-calendar 2027, and ground preparation has begun for our second Idaho fab. We broke ground on our first fab at the New York site, and initial ground preparation activities are ahead of plan. In Japan, we are making good progress on ground preparation for our cleanroom expansion to enable future technology transitions at our Hiroshima site. In NAND, the combination of a higher demand outlook and our decision to colocate R&D cleanroom in our manufacturing fab underpins our decision to break ground for a new NAND fab at our Singapore site. We expect initial wafer output from this fab in 2028.
In assembly and test, we commenced commercial shipments from our new facility in India. The state-of-the-art facility will be among the largest single-floor assembly and test cleanrooms in the world. Our Singapore advanced packaging facility for HBM is on track to contribute meaningfully to Micron Technology, Inc.'s HBM supply in calendar year 2027. We expect fiscal 2026 CapEx to be above $25,000,000,000. From our last earnings call estimate, the majority of the increase is driven by cleanroom facility-related CapEx, of which the largest factor is Tongluo, followed by construction spend increase in our U.S. fab projects. We project our fiscal 2027 CapEx to step up meaningfully to support HBM and DRAM-related investments. We expect construction-related CapEx to increase by over $10,000,000,000 year over year in fiscal 2027 as we build out our global manufacturing sites to address long-term demand opportunities. In addition, we expect higher equipment spend year over year in fiscal 2027. As we make these investments, we will continue to be responsive to the market environment and our customer demand to appropriately align our supply plans. I will now turn it over to Mark for our fiscal Q2 financial results and outlook.