2024-03-26 10:23:50 ET
Micron Technology Inc. (NASDAQ: MU), a global leader in memory chip manufacturing, saw its shares surge over 4% in pre-market trading on Tuesday after reporting record-breaking earnings for fiscal Q2 2024.
The numbers exceeded analyst estimates and reflect the significant role of artificial intelligence (AI) in fueling the demand for data storage solutions.
As a key player in the memory chip market, Micron’s latest earnings report suggests two crucial developments.
Micron earnings show a larger trend
Firstly, the company’s robust performance hints at a potential turnaround in the memory chip sector, indicating an end to the recent market downturn.
Secondly, the surge in demand for data storage, propelled by advancements in AI technology, is driving Micron’s growth trajectory, positioning the company for sustained success in the years to come.
In 2023, Micron emerged as the third-largest supplier of DRAM chips worldwide, boasting a 23% market share and generating annual revenues exceeding $15 billion. Its clientele includes industry giants such as Hewlett Packard Enterprise Co. (NYSE: HPE), Dell Technologies Inc. (NYSE: DELL), Apple Inc. (NASDAQ: AAPL), Amazon.com Inc. (NASDAQ: AMZN), Microsoft Co. (NASDAQ: MSFT), and Alphabet Inc. (NASDAQ: GOOGL).
The company’s latest breakthrough, High Bandwidth Memory 3E ( HBM3E ), has been touted as a game-changer in the high-performance memory solutions space, offering unparalleled speed and capacity.
In its fiscal Q2 2024 earnings report, Micron reported earnings per share (EPS) of 42 cents, surpassing analyst expectations of a loss of 25 cents by 67 cents.
Revenues soared by 57.7% year-over-year to $5.82 billion, exceeding consensus estimates of $5.35 billion. The company’s non-GAAP gross margin surged to 20%, a significant improvement from the previous quarter.
The DRAM segment accounted for $4.2 billion in revenue, representing 71% of total revenue, while NAND revenues reached $1.6 billion, contributing 27% to total revenues. Micron’s average selling prices (ASPs) for both DRAM and NAND witnessed substantial growth, indicating strong market demand.
Looking ahead, Micron issued bullish guidance for fiscal Q3 2024, with expectations of EPS between 38 cents to 52 cents and revenues ranging from $6.4 billion to $6.8 billion.
What did Micron’s CEO say?
CEO Sanjay Mehrotra expressed confidence in Micron’s product portfolio and its ability to capitalize on the AI-driven demand for memory chips, positioning the company for a strong fiscal second half of 2024.
The post Micron Technology (MU) stock is surging as revenues jump 57.7% amid AI boom appeared first on Invezz
