Micron Technology, a leading manufacturer of computer memory and storage, experienced a 7% drop in its stock price during extended trading hours, despite posting better-than-expected results. The focus of investors shifted to the revenue forecast, which was in line with estimates.
For the fiscal third quarter ending on May 30th, Micron reported earnings per share of 62 cents adjusted, surpassing the 51 cents expected by LSEG consensus estimates. The company’s revenue stood at $6.81 billion, slightly higher than the anticipated $6.67 billion.
Looking ahead, Micron projected adjusted earnings per share of $1.08 on revenue of $7.6 billion for the current quarter. Analysts had predicted earnings per share of $1.05 on revenue of $7.6 billion. Despite the stock decline, Micron’s shares have more than doubled in the past year, driven by the increasing demand for artificial intelligence technology.
Micron’s CEO, Sanjay Mehrotra, emphasized the company’s strong position in the AI market, highlighting the need for its advanced memory in AI graphics processing units. The company’s data center business recorded a significant 50% growth on a quarter-to-quarter basis, driven by robust demand for AI-driven data center products.
Mehrotra expressed confidence in Micron’s future prospects, stating that the company’s high bandwidth memory, crucial for AI chips, is already sold out through 2025. He anticipates continued price increases for AI-oriented products, despite steady demand in the PC and smartphone markets.
During a call with analysts, Mehrotra underlined Micron’s potential to benefit from the long-term growth opportunities in the semiconductor industry fueled by AI. The CEO’s positive outlook on the company’s future aligns with the increasing importance of AI technology in various sectors.
Micron’s ability to adapt to the evolving market landscape and capitalize on the growing demand for AI-related products positions it as a key player in the semiconductor industry. As technology continues to advance, Micron remains at the forefront of innovation, driving growth and value for its shareholders.