On Thursday, September 26, the value of shares of Micron Technology, a manufacturer of memory semiconductors, headquartered in Boise, Idaho, showed an increase of more than 13%.
The mentioned upward dynamic is because the specified company has released a revenue forecast for the fiscal quarter, which will end in November. This forecast provides for a strong consumer demand for high-bandwidth memory chips. High prices for the specified microcircuits are also expected as part of the appropriate vision for future results. It is worth noting that the mentioned chips are used to support the rapidly developing artificial intelligence technology.
The published forecast of Micron Technology provides that the revenue of this company for the fiscal quarter, which ends in November, will be fixed at $8.7 billion. The chip manufacturer also noted that the corresponding figure may exceed the expected amount by $ 200 million or be lower within the same scale. It is worth noting that the LSEG consensus forecast provides that Micron Technology’s revenue for the fiscal quarter, which ends in November, will be fixed at $8.28 billion. The chip manufacturer’s more optimistic expectations for the corresponding indicator became the driving force behind the growth of the value of its shares.
Micron Technology, a supplier of products to Nvidia, one of the main beneficiaries of the so-called artificial intelligence boom, was on track to increase its market capitalization by more than $14 billion.
It is also worth noting that in the fiscal quarter ended August 29, the company recorded revenue growth, which turned out to be the best in the last decade. The chip manufacturer’s revenue for this period was fixed at $7.75 billion. The corresponding indicator showed an increase of 93% year-on-year. At the same time, the consensus forecast of analysts interviewed by the media provided that Micron Technology’s revenue for the fiscal quarter that ended August 29 would be fixed at $7.63 billion. SSD sales during this period exceeded the $1 billion mark for the first time.
Ryan Detrick, chief market strategist at Carson Group, said Micron Technology’s upbeat forecast bodes well for the entire artificial intelligence and technology sector.
It is worth noting that the published projection also became the driving force behind the growth of shares of other chip manufacturers, but they pared gains after the media reported that the US Department of Justice was probing server maker Super Micro Computer.
Super Micro, a major customer of microcircuit makers, resells and uses their products in its servers.
Nvidia, Intel, and Broadcom shares were trading slightly higher than previous figures. Qualcomm and AMD securities rose by about 2%. The value of Philadelphia Semiconductor Index shares showed a similar increase.
Analysts who talked to media representatives say that the bar for Micron Technology in this earnings cycle was relatively low. It is worth noting that on the eve of the publication of the forecast on the company’s performance for the financial quarter, which will end in November, the shares of the firm were under pressure from such factors as concerns about falling prices for high-bandwidth memory chips due to increased supply. Over the past three months, Micron Technology securities have dropped in price by more than 20%.
After the mentioned concerns have fundamentally eased, it is likely that the cost of high-bandwidth memory chips after an expensive ramp-up of manufacturing facilities for making microcircuits will contribute to the growth of the company’s gross margins.
As we have reported earlier, Japan Provides Subsidies for Micron Plant.
