tech
Micron stock jumps 15% as soaring prices from memory crunch lead to quadrupling of revenue
Micron's quarterly earnings report follows a 700% surge in the memory maker's stock price over the past year.
TL;DR
- Micron's revenue quadrupled in the fiscal third quarter due to high demand for AI-related memory.
- The company's stock rose 15% in extended trading following the earnings report.
- Revenue beat LSEG consensus estimates, reaching $41.46 billion versus $35.84 billion.
- Micron expects revenue of about $50 billion for the current quarter, exceeding analyst forecasts.
- Memory prices have surged due to AI chip demand consuming production capacity and increasing data center needs.
- The company signed 16 long-term agreements with customers, locking in sales for three to five years.
- These agreements are expected to represent half or more of Micron's revenue and involve financial commitments of $22 billion.
- Gross margin increased significantly to 84.9%, surpassing analyst expectations.
- Net income for the quarter was $28.24 billion, a substantial increase from the prior year.
- The data center business saw over sevenfold revenue growth, while cloud memory, mobile/client, and automotive/embedded segments also experienced substantial increases.
- Micron will issue a 15-cent dividend in July.