Micron Technologies has projected lower revenue for its second fiscal quarter than Wall Street analysts had anticipated. Micron’s stock price tumbled following the lower revenue forecast. However, Micron reported profit and higher revenue than expected in its first quarter of fiscal year, which ended on November 28.
Image Credit: micron.comSanjay Mehrotra, chief executive officer of Micron said, “While consumer-oriented markets are weaker in the near term, we anticipate a return to growth in the second half of our fiscal year. For the second quarter of the fiscal year of 2025, Micron projected per-share earnings between $1.33-$1.53 and revenue between $7.7-$8.1 billion. Analysts expected adjusted earnings of $1.91 a share and revenue of $8.94 billion.
Micron Stock Tumbles on Lower Revenue Forecast
On December 18, Micron’s stock price tumbled by 11% to $91.56. Micron’s shares closed down 4.3% at $103.90, but they’ve risen 26% since the start of the year. Micron reported a profit of $1.87 billion, or $1.67 per share, for the three months ending November 28. This is a significant turnaround from the previous year when the company posted a loss of $1.23 billion, or $1.12 per share.
Micron’s adjusted earnings per share were $1.79, slightly above analysts’ expectations of $1.76. Revenue surged 84% to $8.71 billion, meeting analyst forecasts and falling within the company’s projected range of $8.5 billion to $8.9 billion.
Understanding Micron’s Lower Revenue Forecast
Micron Technology’s forecast for quarterly revenue and profit fell short of Wall Street’s expectations, leading to a dip in its shares. The chipmaker is facing weaker demand for consumer products like personal computers and smartphones, which has impacted its business. Additionally, the market for DRAM chips, which make up most of Micron’s revenue, remains sluggish due to ongoing supply issues and low consumer demand.
CEO Sanjay Mehrotra said, “Demand for smartphones has remained weak and shipments for them are likely to increase in the second half of Micron’s fiscal year ending August 2025.”
Increased demand for HBM chips
Micron’s high-bandwidth memory (HBM) chips, which are crucial for artificial intelligence, have seen strong demand, with revenue from HBM more than doubling. As one of only three major HBM providers, alongside SK Hynix and Samsung, Micron is now focused on ramping up its production of these chips to meet growing market needs.
