(Reuters) -Micron Technology ( MU ) forecast third-quarter revenue above Wall Street estimates on Thursday, signaling strong demand for its high-bandwidth memory (HBM) chips used in AI models, sending its shares up 2% in after-hours trading.

AI demand has significantly boosted the need for Micron's HBM chips, a type of dynamic random access memory or DRAM standard essential for advanced AI systems, including Nvidia's processors, the main beneficiary of the AI boom.

"Sequential growth will continue to happen throughout calendar 2025 as we continue to ramp our capacity and market share in HBM," Micron's Chief Business Officer Sumit Sadana told Reuters. All of its HBM chips are sold out for calendar year 2025, he added.

Micron, which also offers flash memory NAND chips for the data storage market, expects DRAM and NAND demand growth in both data center and consumer-oriented markets, with significantly improved profitability in fiscal 2025 ending August.

Micron's "strong forecast, exceeding analyst expectations on both revenue and earnings, underscores their pivotal role in providing the essential memory components for AI infrastructure," said Michael Ashley Schulman, chief investment officer at Running Point Capital.

Micron said it has not included the impact of potential new tariffs imposed by U.S. President Donald Trump in its forecast due to uncertainty around timing, nature and implementation, but intends to pass on any costs to customers.

Trump's rapidly changing tariff policies, including numerous tariff threats, have led to increased economic uncertainty.

The company said it expects revenue of $8.80 billion, plus or minus $200 million for the third quarter, compared with an estimate of $8.5 billion, according to data compiled by LSEG.

Revenue for the second quarter ending February 27 was $8.05 billion, beating an average estimate of $7.89 billion. Excluding items, earnings per share was $1.56, above an estimate of $1.42 per share.

(Reporting by Juby Babu in Mexico City; Editing by Vijay Kishore)