Micron Technology's Stock Soars on AI-Driven Demand and Analyst Optimism

Breaking down Micron's giant rally. Why JPMorgan thinks shares can jump nearly 90%

The good times should continue to roll for shares of Micron Technology , according to Wall Street analysts. Shares of the memory chipmaker surged 17% on the back of a strong quarter and forecast driven by ballooning artificial intelligence demand, and many Wall Street firms see more upside ahead. The move put the company on pace for its best day since 2011 and put shares up more than 31% year to date. "We believe the stock should continue to outperform through 2024 and into 2025 as the market continues to discount improving revenue/margin/ earnings power on top of strong positive EPS revisions," wrote JPMorgan's Harlan Sur. MU YTD mountain Shares performance this year The analyst reiterated his overweight rating and $180 price target, reflecting 88% upside from Wednesday's close. Underpinning the bullish stance is a bet on the company's significant high-bandwidth memory (HBM) market share and the belief that the sector is in the early stages of a multi-quarter upcycle. Many analyst view the chip company's HBM leadership as key to its ongoing success. Goldman Sachs' Toshiya Hari reiterated his buy rating and adjusted his price target to $145 from $158, still pointing to a 51% gain. The analyst expects upward revision to Street estimates, noting that share gains across "multiple high-value segments" such as high-bandwidth memory should help it battle headwinds facing the smartphone and PC markets. Bernstein's Mark Li expects ongoing demand to improve pricing and lead Micron to a record year in 2025. The analyst has a price target of $146 on Micron, signaling a 46% increase. He also has an outperform rating on shares. Meanwhile Barclays analyst Tim O'Malley referred to the results as "surprisingly strong amidst a sea of worry." "We think that the sustainability of [NAND memory] coupled with more positive HBM commentary should quell fears of a material fundamental slowdown but do worry that we aren't seeing the end market justification of the NAND pricing environment," O'Malley said. O'Malley sees the stock soaring 51% over the next 12 months. He also has an overweight rating on the chipmaker.

Micron's AI-Driven HBM Demand and Data Center Growth to Fuel Stock Upside, Analysts Say - Micron Technology (NASDAQ:MU)

Analysts project Q1 revenue of $8.7B as AI and HBM demand drive growth. Micron Technology, Inc MU stock continued its upward trajectory Thursday after reporting upbeat quarterly results after the market closed on Wednesday. Micron reported fourth-quarter revenue of $7.75 billion, topping the analyst consensus estimate of $7.64 billion. The adjusted EPS of $1.18 beat the analyst consensus estimate of $1.13. Also Read: What's Going On With Nvidia, Broadcom, Intel, And Other Chip Stocks On Thursday? Micron expects first-quarter revenue of $8.7 billion, plus or minus $200 million, and adjusted EPS of $1.74, plus or minus eight cents per share. Morgan Stanley analyst Joseph Moore maintained Micron with an equal weight and raised the price target from $100 to $114. Wedbush analyst Matt Bryson reiterated Micron with an Outperform and a $140 price target. Piper Sandler analyst Harsh V. Kumar maintained Micron with an Overweight with a $150 price target. Rosenblatt analyst Hans Mosesmann reiterated Micron with a Buy and a $250 price target. Stifel analyst Brian Chin maintained Micron with a Buy and a $135 price target. JP Morgan analyst Harlan Sur reiterated Micron's Overweight rating and a price target of $180. Morgan Stanley: Micron posted a strong quarter and outlook, particularly given lower recent expectations, Moore noted. He remained concerned that prices are rising in a slightly oversupplied market. However, as long as producers believe they can sell that product next year, he said it has yet to weigh on pricing. The analyst noted that HBM could continue to deliver a sizeable gross margin premium at equilibrium (particularly given customers prepaying for supply). Interestingly, the upside in the quarter came from the area with the lowest expectations, NAND, as per the analyst. Moore projected first-quarter revenue of $8.70 billion and EPS of $1.76. Wedbush: Micron delivered results that exceeded prior fourth-quarter guidance, Bryson noted. He flagged management guiding towards continued margin growth in the fiscal first and fourth quarters, favorable supply and demand dynamic through calendar 2025, and the HBM demand next year will lift to $25 billion. Net, Bryson found no reason to shift his constructive view. Bryson projected first-quarter revenue of $8.72 billion and EPS of $1.74. Piper Sandler: Micron reported a solid quarter, nicely beating street expectations for the reported quarter and the guide for the November quarter, Kumar noted. His core Micron thesis is playing out very well; near-term supply is capped as there are virtually no wafer fab equipment (WFE) supply increases while rising units across various industries and HBM size and demand are putting pressure on the industry and driving up prices, he said. The analyst continues to expect pricing to increase for both DRAM and NAND. On HBM, capacity for 2024 and 2025 is sold out, and Micron is contracted into pricing and units for both years, Kumar said. He noted a multi-design cadence on HBM for Micron and expects the rising demand and limited supply to help his overall thesis. The analyst does not expect meaningful WFE to come on until 2027. As such, he remains constructive on Micron. Kumar projected first-quarter revenue of $8.70 billion and EPS of $1.74. Rosenblatt: Micron's unambiguous beat and raise last night surprised even Mosesmann as uber Bulls of the Multi Organizations Access Control (MOAC) AI-driven cycle. Near-term smartphone and PC inventory weakness was trumped by big data center strength, HBM mix, high-density DIMMS, and high-end SSDs, he said. The analyst noted Micron as a top pick for 2024 into the biggest semiconductor and memory cycles ever. Mosesmann projected first-quarter revenue of $8.70 billion and EPS of $1.74. Stifel: Micron reported solid quarterly print and surprisingly guided for sustained low double-digit revenue growth, Chin noted. This much better-than-feared outlook runs contrary to his and consensus estimate reductions ahead of earnings. Ultimately, the analyst noted that strength in data center demand is more than offsetting near-term softness in the consumer-centric PC and phone markets. In particular, substantial growth for data center and enterprise products is a trend Micron expects to persist through next year. In sync with Chin's views, management expects a short-lived correction in consumer markets, with inventories normalizing in the third quarter. He added that the company's HBM ramp is also tracking to plan and poised to be a meaningful contributor next year. As per the analyst, Micron's outlook and upbeat commentary should help soothe some concerns that the memory cycle is teetering. Chin noted that the supply remains well managed, with the setup for reinvigorated pricing and margin strength as a kicker next year intact. China projected first-quarter revenue of $8.70 billion and EPS of $1.77. JP Morgan: Micron reported a better-than-expected quarterly print on more substantial pricing power and an expected flattish DRAM bit shipment profile, Sur noted. The analyst said that the first-quarter outlook reflects a better shipment profile driven by a recovery in traditional server, enterprise, and cloud demand overlaid with accelerating HBM, AI revenue contribution, and continued blended pricing increases. Overall, Sur noted that the memory industry is in the early stages of the up-cycle. Out-year EPS estimates typically get revised by ~2x-3x, and memory stocks usually follow the positive EPS revision trajectory higher. The analyst noted the stock should continue to outperform through 2024 and into 2025 as the market continues to discount, improving revenue, margin, and earnings power on top of substantial positive EPS revisions. Given the strong upside from current levels, Sur would be buying the stock at current levels. Sur projected first-quarter revenue of $8.70 billion and EPS of $1.74. Price Action: MU stock is up 15.70% at $110.79 at the last check on Thursday. Also Read: Synopsys Partners With Taiwan Semi To Power Next-Gen AI Chip Innovations Image via Micron Market News and Data brought to you by Benzinga APIs

Analysts race to overhaul Micron stock price targets after earnings

Micron Technology shares surged in early Thursday trading, putting the stock on pace for its highest level in two months, after the chipmaker posted stronger-than-expected fourth quarter earnings and a robust outlook that added support to the broader AI investment theme. Micron (MU) , which is the first of the major chipmakers to report quarterly earnings each season, is also seen as a bellwether for the semiconductor sector given that is products are used in computers, smartphones and data centers around the world. It's also establishing a key place in the market for so-called HBM, or high bandwidth memory chips, which improve performance and reduce power consumption in AI systems. Those chips, including a new HBM3E iteration, are now being built into Nvidia's (NVDA) H200 processors, as well as its newly developed Blackwell systems, which have established Micron as one of just a few global companies that can compete in this fast-growing market. Micron didn't disclose revenue figures for its HBM chips, but reiterated that it delivered "several hundred million dollars" of sales in its 2024 financial year, which ended on August 29, and sees "multiple billions of dollars of revenue of HBM in fiscal year '25." Micron's solid HBM outlook The group said it sees the total addressable market for HBM chips, which are also made by South Korea-based SK Hynix and Samsun Electronics, rising from $4 billion in 2023 to around $25 billion in 2025. The solid HBM outlook helped offset stalled PC and smartphone chip sales, where prices have been hit by a broader market glut as well as a pullback in consumer electronics spending. Still, Micron was able to post fourth quarter revenues of $7.75 billion, a tally that was nearly double the same period last year and just ahead of Street forecasts, and a bottom line of $1.18 per share. Related: Analysts overhaul Micron stock price targets amid post-earnings slump Looking into the current quarter, Micron said it sees revenues in the region of $8.7 billion, with $200 million margin of error, as well as earnings of around $1.74 per share. Profit margins, Micron said, would improve by 300 basis points to 39.5% thanks in part to a heavier mixed of higher-priced HBM sales. We are entering fiscal 2025 with the strongest competitive positioning in Micron's history," CEO Sanjay Mehrotra told analysts on a conference call late Wednesday. "As we move through the year, we expect a broadening of demand drivers, complementing strong demand in the data center. "We look forward to delivering a substantial revenue record with significantly improved profitability in fiscal 2025, beginning with our guidance for record quarterly revenue in fiscal Q1," he added. "Micron is ramping production of the industry's most advanced technology nodes in both DRAM and NAND." Capex boost BofA analyst Vivek Arya, who boosted his Micron price target by $15 to $125 per share in a note published Thursday, was impressed by the nature of Micron's better-than-expected update. "Despite increasing macro (softer PC, phone demand) headwinds, Micron was able to deliver beat/raise results on the back of solid data center demand, including continued growth in its AI-levered high-bandwidth memory (HBM) sales," he said. "Further, management reiterated their call for a record [2025 fiscal year], raised the HBM market to $25 billion+ from $20 billion with strong pricing/share visibility," he added. TD Cowen analyst Karl Ackerman also noted the PC and smartphone softness, but added that "the anticipated mid-cycle in memory between now and 2025 appears to be shallower than feared, supported by continued strength from datacenter customers." Related: Analyst updates Micron stock price target after conference Lifting his Micron price target by $20, to $135 per share, Ackerman added that 'we see stock momentum continuing with B100 qualification, 12H HBM ramp, and improved supply chain visibility in 2025 for PC/mobile as future catalysts." CFRA analyst Angelo Zino, who held his $140 price target in place after last night's earnings, noted the potential upside from Micron's tie-ins with Nvidia processors such as Blackwell and Rubin. "We think investors continue to underestimate the content growth story on the DRAM server side, with line of sight for sharply higher HBM growth as NVIDIA's Blackwell offering ramps in CY 25/Rubin in CY 26," he said. "In addition, we see improved PC/non-data center demand in CY 25 that will see edge applications include more DRAM memory." Other moves included Morgan Stanley analyst Joseph Moore, who raised his price target on Micron to $114 per share from $100, while Goldman Sachs analyst Toshiya Hari reiterated his $145 price target. More AI Stocks: Mizuho analyst Vijay Rakesh, however, lowered it to $135 from $145 per share while Susquehanna cut it to $165 per share from $175. Micron said its 2025 capex spend would be "meaningfully higher" than in 2024, when it totaled $8.1 billion, pegging it "around the mid-30s percentage range of revenue based on our current CapEx and revenue expectations. At current forecasts, that would translate to capex of $13.5 billion, a near 70% increase from fiscal 2024 levels. Micron shares were last marked 16.9% higher in premarket trading to indicate an opening bell price of $112.01 each. Related: Veteran fund manager sees world of pain coming for stocks

JPMorgan highlights Micron Technology stock's resilience against DRAM market concerns By Investing.com

On Thursday, JPMorgan (NYSE:JPM) upheld a positive outlook on Micron Technology (NASDAQ:MU) shares, maintaining an Overweight rating and a $180.00 price target. The firm's endorsement follows Micron's announcement of better-than-expected financial results for the August quarter, which included revenue, gross margins, and earnings per share exceeding market anticipations. The upbeat guidance for the following quarter suggests a 12% quarter-over-quarter increase in revenues, surpassing the lower consensus expectations and aligning closely with JPMorgan's optimistic forecast. This projection is supported by a rebound in server, enterprise, and cloud demand, as well as accelerating contributions from high-bandwidth memory (HBM) and artificial intelligence (AI) revenue, coupled with ongoing price increases across product mixes. Micron's strategic shift towards high-value products, such as HBM, high-density DRAM, and enterprise solid-state drives (eSSD), has led to a diminishing reliance on DDR4 products, which traditionally faced commodity DRAM weakness. The company's favorable supply and demand dynamics are expected to continue through the remainder of 2024 and into 2025, propelled by strong AI server demand and a tight supply environment for leading-edge technology. The semiconductor manufacturer has also raised its 2025 market forecast for HBM by 25%, from $20 billion to $25 billion, and is positioned to capture a significant market share in line with its overall DRAM market share by the same year. Micron's revenue from HBM is anticipated to reach multiple billions of dollars in fiscal year 2025, a substantial increase from the hundreds of millions reported in fiscal year 2024. In addition to product mix improvements, Micron is advancing its technology with HBM3E and the next-generation HBM4, which are expected to enhance the company's profitability and drive capital expenditures to approximately $14 billion, or mid-30% of revenue, in fiscal year 2025. JPMorgan's analysis indicates that the memory industry is in the early stages of an up-cycle, where earnings per share estimates and stock prices tend to rise significantly. As Micron continues to demonstrate strong revenue, margin, and earnings growth, JPMorgan predicts that the stock will outperform through 2024 and into 2025. In other recent news, Micron Technology reported a robust close to fiscal year 2024, with a 60% annual revenue increase and expectations for continued strength into fiscal 2025. The company achieved record revenues in its NAND and storage businesses, bolstered by advancements in 1-beta DRAM and G8/G9 NAND technologies. Morgan Stanley (NYSE:MS) has raised its price target for Micron to $114, maintaining an Equalweight rating, while Stifel upgraded its price target from $175 to $200, endorsing a Buy rating. Both firms highlighted Micron's strong performance and favorable financial health. Micron Technology also announced plans to expand its manufacturing footprint with new facilities in Idaho, India, and China. The company anticipates a record quarterly revenue for fiscal Q1 2025, driven by high-volume production of advanced technology nodes and strong demand from data centers. Micron's financial health remains strong, with $9.2 billion in cash and investments, and $11.7 billion in liquidity. The projected non-GAAP EPS for fiscal Q1 is $1.74.

BofA sees upside in Micron stock with increased HBM market share By Investing.com

On Thursday, BofA Securities updated its outlook on Micron Technology (NASDAQ:MU) stock, raising the price target to $125 from the previous $110, while reaffirming a Buy rating. The revision follows Micron's performance, which has been bolstered by robust data center demand, especially with the growth in sales of high-bandwidth memory (HBM) leveraged by artificial intelligence. Micron's recent financial results surpassed expectations, even amidst broader macroeconomic challenges like declining demand for PCs and smartphones. The company's management has projected a record fiscal year 2025, increasing the total addressable market (TAM) for HBM to over $25 billion from $20 billion. This upgrade is supported by strong pricing and market share visibility. Additionally, Micron's gross margins for the fourth fiscal quarter and the first quarter were notably higher than anticipated, coming in at 36.5% and 39.5% respectively, compared to the consensus estimates of 34.6% and 37.8%. Despite an anticipated softer second fiscal quarter due to seasonality, BofA Securities has increased its fiscal year 2025 and 2026 earnings estimates for Micron by 22% and 31%, to $7.18 and $9.87 per share respectively. The new price objective reflects a price-to-book multiple of 2.5 times the calendar year 2025 estimates, an increase from the previous 2.2 times, while remaining within Micron's historical range of 0.8 to 3.1 times. BofA Securities forecasts that Micron's HBM sales could reach $4 billion in the calendar year 2025, which would give the company approximately a 16% share of the market. There is potential for an even higher market share, possibly over 20% or $5 billion, if the HBM segment continues to be dominated by only Micron and Hynix. The firm also notes that Micron's strength in the data center sector is a positive indicator for other companies in the industry, including Nvidia (NASDAQ:NVDA), Broadcom (NASDAQ:AVGO), Marvell Technology (NASDAQ:MRVL), Advanced Micro Devices (NASDAQ:AMD), and KLA Corporation (KLAC), as well as the broader semiconductor capital equipment sector. In other recent news, Micron Technology Inc (NASDAQ:MU). has projected an optimistic revenue forecast for the first quarter, surpassing market expectations due to robust demand for its high bandwidth memory (HBM) chips. The company has projected revenues to be around $8.70 billion, higher than analyst estimates of $8.28 billion. However, CFRA, a financial research firm, has adjusted its outlook on Micron, reducing the stock's price target from $170 to $140, while maintaining a Buy rating. The firm expects a gross margin of 34.5% for the same period and forecasts revenue of $8.3 billion for the November quarter. Likewise, Rosenblatt Securities maintained a Buy rating on Micron with a steady price target of $225.00, despite potential pressures on average selling prices. TD Cowen also maintained a Buy rating on Micron but reduced the price target from $160.00 to $115.00, citing the current negative sentiment and stable long-term fundamentals. Stifel adjusted its price target for Micron to $135, down from $165, but maintained a Buy rating. This adjustment comes as Micron prepares to release its fiscal fourth quarter earnings report. Despite these adjustments, Micron has launched its Crucial P310 2280 Gen4 NVMe solid-state drive (SSD), which promises double the performance of Gen3 SSDs and a 40% speed increase over its predecessor.

Rosenblatt raises price target on Micron shares By Investing.com

Micron Technology (NASDAQ:MU)'s stock received a boost from Rosenblatt Securities, which raised its price target on the company to $250 from $225 while reiterating a Buy rating. The adjustment follows Micron's impressive financial performance, which outpaced even the most optimistic expectations, driven by a potent mix of artificial intelligence and memory cycle dynamics. Micron's recent earnings report revealed a significant victory, marked by a robust data center demand, particularly in AI and general purposes, which offset weaker smartphone and PC inventory levels. The company's high-bandwidth memory (HBM) mix, high-density DIMMs, and premium solid-state drives (SSDs) contributed to its strong results. The firm noted that while the market had been bracing for a downturn due to soft smartphone and PC inventories, Micron's success with its HBM technology has been a game-changer, challenging conventional supply and demand dynamics. The industry's supply/demand balance for DRAM is anticipated to tighten continuously through the end of 2025. Micron's HBM offerings, which are already sold out, are expected to help normalize smartphone and PC inventory levels by spring. Additionally, the NAND segment is also showing positive supply/demand indicators. Analysts have questioned Micron's ambitious goal to capture over 20% of the 2025 DRAM market share, which is estimated to be around $25 billion. The skepticism arises from uncertainties surrounding negotiated orders that define unit sales and pricing. Micron has also been recognized for its innovation in HBM, a field traditionally led by SK Hynix. The company has developed HBM products that boast 30% lower power consumption and is planning to introduce new versions by 2025 that are 20% more power-efficient than their predecessors. This technological advancement is expected to secure Micron higher average selling prices (ASPs). Rosenblatt's updated price target is based on a mid-teens price-to-earnings (P/E) multiple off their new fiscal year 2026 non-GAAP earnings per share (EPS) estimate of $18.00. In other recent news, Micron Technology demonstrated a strong financial performance with impressive revenue and earnings per share for the August quarter. The company's robust results were driven by a surge in demand for its AI-related memory chips. Analyst firms, including Mizuho, Goldman Sachs (NYSE:GS), and UBS, have adjusted their price targets and maintained a positive outlook on Micron. They anticipate that the current fluctuations in inventory levels for PCs and smartphones are temporary and that the demand for High Bandwidth (NASDAQ:BAND) Memory will rise due to robust demand for Graphics Processing Units in the coming years. Micron also announced plans to expand its manufacturing footprint with new facilities in Idaho, India, and China, positioning itself to meet strong demand from data centers. As Micron Technology (MU) navigates through the dynamic semiconductor industry landscape, real-time data from InvestingPro provides a deeper understanding of the company's financial health and market position. With a market capitalization of $105.78 billion, Micron stands as a prominent player in its sector. Despite a negative P/E ratio of -68.02 indicating recent unprofitability, analysts predict a turnaround with growth anticipated in the current year. InvestingPro Tips highlight Micron's commitment to shareholder returns, with dividends raised for three consecutive years, demonstrating confidence in its financial stability. Additionally, the company's liquid assets surpassing short-term obligations suggest a robust balance sheet capable of weathering market fluctuations. While the company has faced challenges with gross profit margins, which stood at 22.35% over the last twelve months, the anticipation of sales growth and profitability this year, combined with a strong return over the last five years, positions Micron favorably for investors seeking long-term growth. For investors looking to delve deeper into Micron's performance and potential, additional InvestingPro Tips are available, offering comprehensive analysis and forecasts that can guide investment decisions. To explore further, visit https://www.investing.com/pro/MU for a complete list of tips and in-depth metrics.

Micron Stock Pops on Strong Outlook Driven by 'Robust AI Demand'

CEO Sanjay Mehrotra said the company expects current-quarter revenue to reach a record high. Micron Technology (MU) shares surged in extended trading Wednesday as the company's revenue and outlook blew past expectations. The memory chip maker and Nvidia (NVDA) partner swung to a profit of $887 million or 79 cents per share in the fiscal fourth quarter, from a loss of $1.43 billion or $1.31 per share a year ago. Revenue nearly doubled to $7.75 billion, topping analysts' estimates. Micron CEO Sanjay Mehrotra said the revenue gains were driven by "robust AI demand," and that the company is moving into fiscal 2025 "with the best competitive positioning in Micron's history." Micron said it expects current-quarter revenue to reach a record high between $8.5 billion to $8.9 billion, with the low end of that range above the analyst consensus. The company's projection for diluted earnings per share (EPS) of between $1.46 and $1.62 also exceeded estimates. Shares of Micron jumped more than 13% to $108.34 in extended trading Wednesday following the release.

Micron's stock surges as AI companies scramble for high-bandwidth memory chips - SiliconANGLE

Micron's stock surges as AI companies scramble for high-bandwidth memory chips Shares of the semiconductor company Micron Technology Inc. were flying higher in late trading today after it delivered strong results in its fiscal fourth quarter and impressed with its outlook. The company reported earnings before certain costs such as stock compensation of $1.18 per share, coming in ahead of the consensus estimate of $1.11. Revenue for the period jumped 93% from a year earlier to $7.75 billion, easily beating the analyst forecast of $7.65 billion. In addition, the company logged net income of $887 million, rebounding from a $1.43 billion loss in the year-ago quarter. The forecast for the current quarter was even more impressive. Micron said it's projecting revenue of $8.5 billion to $8.9 billion, well ahead of the analyst's target of $8.3 billion. That number would represent exceptional growth. In the first quarter of fiscal 2024, the company generated revenue of just $4.73 billion. Micron also projects earnings of $1.74 per share at the midpoint of its range, compared to the Street's guidance of just $1.52 per share. With the conclusion of its fourth quarter, Micron also reported its full fiscal 2024 results, saying it generated total revenue of $25.11 billion, up from $15.54 billion in the previous year. All told, its net income for the year came to $1.47 billion. Within the semiconductor industry, Micron has established itself as a leader in the dynamic random-access memory chip segment. DRAM is widely used in personal computers and servers. More recently, Micron has made a name for itself as a key supplier of high-bandwidth memory, or essentially higher capacity DRAM, which is used in artificial intelligence servers. Whereas Nvidia Corp.'s graphics processing units provide the actual processing power for AI systems, Micron's chips provide the memory and storage capacity those workloads need. With the AI industry going bananas these days, that explains the turnaround in Micron's fortunes over the last year, as acknowledged by its Chief Executive Sanjay Mehrotra (pictured). "Robust AI demand drove a strong ramp of our data center DRAM products and our industry-leading high bandwidth memory," the CEO said in a statement. "We are entering fiscal 2025 with the best competitive positioning in Micron's history. We forecast record revenue in fiscal Q1 and a substantial revenue record with significantly improved profitability in fiscal 2025." Those last comments were music to the ears of investors, sending Micron's stock up more than 14% in extended trading, adding to a slight gain of just over 1% during the regular trading session. Besides selling DRAM products, Micron also makes NAND memory, which is the main component of flash memory drives, which are used in smartphones and USB sticks. That segment of the company's business is also on the up, with Mehrotra noting it delivered over $1 billion in quarterly sales for the first time. Micron's fortunes are often held hostage by a delicate supply-demand balance in the memory chip market, as this is one of the main factors that affects the prices of its chips. On the supply front, Mehrotra said on a call with analysts that the current environment is looking extremely good for the company, with "industry conditions set to help drive the improvement in profitability needed to enable investments required to support future growth." Micron's finance chief Mark Murphy also spoke on the call, saying that demand for high-bandwidth memory is "creating supply constraints in the marketplace as share bits increase. According to him, that should ensure the supply and demand environment remains healthy throughout the remainder of the calendar year and beyond. The earnings beat and positive outlook were a pleasant surprise for investors, as sentiment around Micron has been less than enthusiastic in recent months. Three months earlier, the company's stock plunged on the back of a disappointing outlook, and just ahead of today's earnings report, a Citi analyst issued a note warning investors to expect below-consensus guidance. Although Micron's stock had fallen 32% in the last three months, it was still up 12% in the year to date, prior to today's moves.

Micron Q4: HBM Growth Continues In 2025, Upgrade To Strong Buy (NASDAQ:MU)

Anticipate 50% revenue growth in FY25 and 30% in FY26, driven by AI and high-performance computing, despite high depreciation costs. I reiterated my "Buy" rating for Micron Technology, Inc. (NASDAQ:MU) in my previous coverage in July 2024, highlighting their HBM3E's production ramp-up in Q3. Micron released its fiscal Q4 result I am a growth-oriented investor, conducting fundamental research. Long-term focus, independent thinking. I prefer companies with deep moats and high recurring sales growth.Disclosure: Hunter Wolf and I are working in the same investment team. I am writing here independently. Analyst's Disclosure: I/we have a beneficial long position in the shares of MU either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Micron forecasts upbeat quarterly revenue on memory chips demand

Sept 25 (Reuters) - Micron Technology (MU.O), opens new tab forecast first-quarter revenue above market estimates on Wednesday, betting on strong demand for its high bandwidth memory (HBM) chips used by the AI industry. The company's shares rose 10% in after-hours trading. Micron is one of the only three providers of HBM chips along with South Korea's SK Hynix (000660.KS), opens new tab and Samsung (005930.KS), opens new tab, which has allowed the U.S. firm to cash in on demand for semiconductors that help power generative AI technology. Advertisement · Scroll to continue The AI boom has also helped Micron cushion the hit from a memory chip inventory glut in PC and smartphone markets. The company's results typically set the tone for the chip sector as it reports ahead of peers and serves a broad client base spanning the PC, data center and smartphone industries. Micron said in June its HBM chips were sold out for the 2024 and 2025 calendar years. The chips are used in the AI processors designed by Wall Street darling Nvidia (NVDA.O), opens new tab. Advertisement · Scroll to continue Micron said it expects revenue of $8.70 billion, plus or minus $200 million, for the first quarter, compared with estimates of $8.28 billion, according to LSEG data. Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shounak Dasgupta Our Standards: The Thomson Reuters Trust Principles., opens new tab

1 Artificial Intelligence Stock Down 43% Set to Soar 100% by 2026, According to Wall Street | The Motley Fool

Artificial intelligence stocks have had a tough summer, following a tremendous run in AI-related tech stocks that began in late 2022. One key stock at the very center of the AI boom has actually lost 43% of its value from its June highs. However, some analysts see this summer's pullback as far too early for a semiconductor bear market. Rather, they think the recent drawdown is a mere mid-cycle correction, and overdone. In fact, one analyst said Monday he expects this AI winner set to more than double from current levels before the cycle is over. Oh, and this stock also reports earnings today. Micron Technology (MU 0.46%) has seen extreme volatility this year, in both directions. Micron nearly doubled between January and early June, before its stock corrected after its June earnings release, then even more so over the summer. Yet even after its 43% swoon, the stock is up almost 10% for the year as of this writing. Micron can be incredibly volatile because it produces memory chips, including DRAM and NAND flash. Despite a highly concentrated market with just a few players, pricing for these types of chips can move all over the place based on industry supply and demand. While most DRAM and NAND are like commodities, artificial intelligence training applications require a new type of DRAM called high-bandwidth memory (HBM). This type of stacked DRAM is harder to produce, and thus carries with it more pricing power. That pricing power may be especially high for Micron, which claims its latest HBM3E product has 30% lower power consumption than competitors. Micron's HBM3E just began shipping in the May quarter, is expected to generate "multiple hundreds of million dollars" in revenue for the August quarter, then "multiple billions of dollars" in the coming fiscal year, according to management. Even better, Micron's HBM is set to have higher margins than Micron's other products, lifting the company's overall margin profile. HBM also requires more capital equipment and manufacturing steps than traditional DRAM. So in the midst of the DRAM downturn, producers shifted equipment to produce HBM, decreasing capacity for other types of DRAM. The combined effect has been DRAM prices increasing over the last three quarters, with projections for more increases in the quarters ahead. While the AI market is still projected to see outsized demand this year, Micron still gets a large portion of its revenue from the mature PC and smartphone segments. As phone and PC vendors expected price increases this year, many stockpiled memory inventory earlier in 2024. But as the summer progressed, we've seen more lackluster demand for PCs than expected, and early orders for the AI-powered iPhone 16 have underwhelmed. So, for the non-HBM portion of Micron's business, some analysts are anticipating a slowdown relative to prior expectations. Hence, why Micron fell nearly in half after its epic early year run. Memory chips are perhaps the most cyclical or the highly cyclical semiconductor sector, so when there is a downturn, it can be severe. However, several Wall Street analysts don't think we're on the brink of a memory downturn. Rather, the recent slowdown seems like a mid-cycle "pause" them, before going on to new highs. This is because memory cycles usually last between six and eight quarters. Given that the memory industry just went through one of its worst downturns ever in 2022 and 2023 and that we are only three quarters into this up-cycle, it seems pretty early on for the memory players to roll over into another downturn. Last week, three separate analysts from UBS, Susquehanna, and Citigroup each wrote that the current "pause" in DRAM pricing growth was likely temporary. Then on Monday, analysts at JPMorgan Chase noted Micron could go as high as $200 per share, or more than double its current price, if the current up-cycle mirrors the strong 2017-2018 memory boom. Back then, DRAM prices exploded as the cloud computing buildout added a new layer of demand following a 2016 downcycle -- not dissimilar to what HBM and AI are doing today. The current AI buildout has crowded out a lot of other enterprise spending, especially on traditional servers and PCs. Meanwhile, high interest rates have caused consumers to pull back on smartphone and new auto purchases. But with the Federal Reserve now beginning to lower interest rates, it's quite possible consumers and enterprises open the purse strings again. So looking into late 2024 and 2025, the memory industry could very well tighten, with Micron poised to benefit. In particular, Citi analyst Christopher Danley sees a reacceleration in pricing over the next three to six months. Interested investors should stay tuned for Micron's earnings release and conference call after market close for more color on the state of this important industry.

Micron Q4 Earnings: Revenue, EPS Beat On 'Robust AI Demand,' Company Sees 'Significantly Improved' Profitability Ahead, Shares Surge - Micron Technology (NASDAQ:MU)

Micron reports fourth-quarter adjusted earnings of $1.18 per share, beating analyst estimates of $1.13 per share. Micron Technology Inc MU reported fourth-quarter financial results after the market close on Wednesday. Here's a look at the key metrics from the quarter. Q4 Earnings: Micron reported fourth-quarter revenue of $7.75 billion, beating the consensus estimate of $7.635 billion. The company reported fourth-quarter adjusted earnings of $1.18 per share, beating analyst estimates of $1.13 per share, according to Benzinga Pro. Operating cash flow came in at $3.41 billion versus $2.48 billion in the prior quarter and $249 million in the comparable quarter last year. Adjusted free cash flow was $323 million in the quarter. The company ended the quarter with $9.16 billion in cash, marketable investments and restricted cash. "Micron delivered 93% year-over-year revenue growth in fiscal Q4, as robust AI demand drove a strong ramp of our data center DRAM products and our industry-leading high bandwidth memory. Our NAND revenue record was led by data center SSD sales, which exceeded $1 billion in quarterly revenue for the first time," said Sanjay Mehrotra, president and CEO of Micron. "We are entering fiscal 2025 with the best competitive positioning in Micron's history. We forecast record revenue in fiscal Q1 and a substantial revenue record with significantly improved profitability in fiscal 2025." Micron noted that its board declared a quarterly cash dividend of $0.115 per share, payable on Oct. 23 to shareholders of record as of Oct. 7. See Also: Meta Unveils New AI Features, Quest 3S, Llama 3.2, Holographic Orion Glasses At Connect 2024: 'We Are Getting Closer To Achieving The Dream Of Reality Labs' What's Next: Micron sees first-quarter revenue of $8.7 billion, plus or minus $200 million. The company expects first-quarter adjusted earnings of $1.74 per share, plus or minus eight cents per share. Micron management will hold a conference call to discuss these quarterly results at 4:30 p.m. ET. MU Price Action: Micron shares were up 11.74% after hours, trading at $107.03 at the time of publication Wednesday, according to Benzinga Pro. Photo: Shutterstock. Market News and Data brought to you by Benzinga APIs

Micron's Results May Reveal an AI Winner Trading at a Discount

Micron Technology Inc. will probably become the latest chipmaker to assure investors that demand for AI-related gear is still strong. Like many peers, it may also admit that other staple areas of demand such as PCs and smartphones remain in the doldrums. The company is due to report after market close, and analysts expect strong growth related to its high-bandwidth memory chips, used in artificial intelligence data processing. Positive commentary on AI demand could reinvigorate the AI chip trade, which stalled after mixed reports from Broadcom Inc. and Nvidia Corp.