#MicronTechnology #EarningsReport #AIDrivenGrowth
Micron Shares Slide Despite Strong Earnings Due to Revenue Forecast
Micron Technology, a leading player in computer memory and storage, saw its stock plummet by nearly 8% during after-hours trading on Wednesday, despite exceeding expectations in its recent earnings report. The focus shifted to a revenue forecast that aligned with estimates, causing investor disappointment.
Key Performance Metrics
- Earnings per share: 62 cents adjusted, exceeding the anticipated 51 cents
- Revenue: $6.81 billion, surpassing the expected $6.67 billion
Future Outlook
Micron anticipates adjusted earnings per share of $1.08 with revenue reaching $7.6 billion in the upcoming quarter. Analysts had predicted earnings per share of $1.05 on the same revenue figure.
AI-Driven Growth
Despite the share price doubling over the past year, driven by the surge in artificial intelligence, Micron's premium memory is crucial for AI graphics processing units like those from Nvidia, positioning the company to capitalize on the rising demand for AI technology, such as OpenAI's ChatGPT.
Previous Quarter Performance
In the previous quarter, Micron reported a net income of $332 million, equivalent to 30 cents per share, a stark contrast to the $1.9 billion net loss or a loss $1. per share, the same period last year.
CEO Insights
CEO Sanjay Mehrotra emphasized Micron's AI segment, acknowledging the sluggishness in the smartphone and PC markets. Mehrotra anticipates a potential price increase in the company's AI-focused products and noted a 50% growth in the data center business quarter-over-quarter.
Market Dynamics
Mehrotra pointed out the escalating demand for data center products driven by AI, resulting in supply constraints for their cutting-edge nodes. He projected continuous price hikes until 2024, despite stable short-term demand in PCs and smartphones.
Original Article: https://www.cnbc.com/2024/06/26/micron-shares-slide-after-revenue-forecast-fails-to-top-estimates.html
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