Micron stocks tick higher on upbeat revenue forecast

Shares of Micron Technology, Inc. climbed on Tuesday’s after-hours after posting a better-than-expected fiscal third-quarter outlook.

The American chipmaker gained 3.88% or 3.18 points to $85.23 per share. It followed a jump of 2.74% or 2.19 points to $82.05 per share in regular trading.

Accordingly, this upturn sent $3.57 billion to the company’s market valuation.

Micron CEO Sanjay Mehrotra said the firm is on track to deliver record revenue and robust profitability in fiscal 2022 following an outstanding first half.

He also mentioned that the business is leading the industry in technology across DRAM and NAND chips.

Correspondingly, the company expects its earnings per share in a range of $2.56 to $2.36. This projection surpassed the market consensus of $2.21 EPS.

Then, it anticipated revenue to range from $8.50 billion to $8.90 billion. The figure outpaced the analysts’ forecast of $8.06 billion.

The upbeat guidance came after the company delivered positive second-quarter earnings.

Subsequently, revenue in the three months ended in February increased 26.00% year-over-year to $7.80 billion. It went beyond the expected $7.53 billion.

Then, Micron yielded a net profit of $2.14 per share, beating the estimate of $1.98. Over the last four quarters, it has exceeded consensus EPS estimates four times.

In addition to the substantial profits, the firm posted $1.00 billion in free cash flow. Its gross profit margin was 47.80%, higher from 32.90% in the same period last year.

Before the post-trading, the semiconductor company had lost 14.31% or 13.70 points since the start of the year.

Micron now looked forward to the finalization of the $52 billion chips bill. It is a massive push to rebuild the crumbling US semiconductor infrastructure.

Micron safe from Ukraine supply hit

Moreover, Micron ensured that there would be no impact on near-term production from component shortages driven by the Ukraine crisis.

However, the firm expected costs to rise as it secures the supply of certain raw materials. It noted that recent efforts to diversify supply and maintain inventories helped contain the conflict.

Meanwhile, the two leading Ukrainian neon suppliers have halted their operations due to the escalating crisis.

They produce about half the world’s supply of critical gas, threatening to drive up prices. At the same time, this could worsen the ongoing semiconductor crunch.

Eventually, experts mentioned that the impact of Kyiv-driven supply shortfalls will not show up until seven to nine months later.

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