Earnings Review: Micron and Cintas

December 18, 2025

Today we had earnings reports from two stocks in our universe -- Micron (MU) and Cintas (CTAS). We'll review each and the potential for read-thru below.

Micron

Micron (MU) reported super strong earnings last night, and the stock is up 11% at the moment.  Perhaps more importantly, we should remember that Micron makes memory chips.  And those chips are used by every major tech company in every major tech product.  So strong demand for Micron is being read as continued strong demand across the technology world.  On top of the good inflation news, this is helping to drive the stock market (esp tech stocks) higher.

So what does Micron do exactly?  They make computer memory chips -- for your computer, for your phone, for the servers running AI.  Micron is one of the big three companies that makes short-term memory in computers and servers.  Sounds like a good business, right?  Well, the catch is that its chips are basically the exact same as its competitors’ chips (more or less).  So, in many ways, this is a commodity business.  And like commodities, there’s a large fixed-cost component to the business.  So the supply and demand are the primary profit drivers.   What’s that mean?  It means when times are good, they’re REALLY good.  When times are bad, they’re really bad.

And for now, times are really good.  The demand for servers is off the charts as AI data center demand continues to be strong. And those servers need memory.  On the supply side, the “big 3” are not being greedy.  They’re expanding their supply base at a deliberate pace.  As such, pricing is through the roof.  Last quarter, revenue grew 57% and earnings grew 280%.  Let the good times roll.

Micron is currently the 32nd largest stock in the index.  And it’s one of the most volatile.  The gap between its 52-week high and low is over 300%.  That’s the largest gap of any company in the top 100 stocks.

Cintas

Cintas (CTAS) also just reported stronger than expected earnings.  Much more boring than Micron, Cintas is “the uniform company”.  They provide outsourced services including uniform rentals and facility services.   (Seriously, could it get more boring?)  What makes Cintas special, however, is that they keep adding new services to their portfolio.  In a world of increasing workplace safety regulations, more companies are choosing to outsource those services to companies like Cintas, rather than to risk breaking an obscure safety regulation that they dont really care about anyway.   And once Cintas brings them in the door, Cintas will cross-sell additional services from its portfolio suite.  

Sounds simple, but it works. In this past quarter, Cintas organic revenue grew +8.6% and operating profit grew +18.3%.  Mgmt also increased full-year revenue and EPS guidance.  Operating margins are at an all time high.  And share count declines steadily from consistent share repurchases.

The stock has been under pressure this year, due to cyclical fears around a weaker job market.  However, that has not yet shown up in the results.  And the stock has still outperformed the S&P 500 over the past 5 and 10 yrs.  The downside?  If we get a sharp pullback in employment and/or corporate profit growth, Cintas revenue growth would be muted.  In the Great Financial Crisis, revenue growth dropped 4% in 2009.  In the COVID shutdown, revenue growth fell to the low single digits.

But for now at least, Wall Street expects sustainable double-digit earnings growth from a company that’s unrelated to AI.  You dont see that everyday.