On Wednesday Eastern Time, Micron Technology released its first quarter financial report (ending on November 28th).
According to the financial report, although Micron's performance in the first quarter was roughly in line with expectations, due to weak demand for consumer electronics and weakened prices of storage chips, Micron Technology's outlook for revenue and profit in the second quarter was lower than Wall Street's expectations. This led to a significant drop in the company's stock price in after hours trading, with a drop of nearly 16% as of press time.
Affected by weak market demand, Micron's stock price has fallen by over 30% from its historical high set in June.
Micron handed over a disappointing answer sheet
With Broadcom's recent strong financial report and outlook, there have been significant fluctuations in the US chip stocks. Therefore, Micron's financial report has also attracted market attention.
However, unlike Broadcom, Micron's financial report did not satisfy the market. Due to weak consumer demand and persistent oversupply, the global DRAM chip market remains sluggish, with DRAM chips accounting for the majority of Micron's revenue.
According to the financial report, in the first quarter ending on November 28th,
Micron's revenue was $8.71 billion, with analysts expecting $8.7 billion;
The adjusted EPS is $1.79, and analysts expect it to be $1.76.
Looking ahead to the second fiscal quarter, based on data compiled by LSEG, after excluding specific projects,
Micron expects a second quarter earnings per share of $1.43, with a fluctuation of $0.10, while analysts expect $1.91.
Micron expects its second quarter revenue to be $7.9 billion, fluctuating by $200 million, while analysts estimate it to be $8.98 billion.
Consumer electronics market demand remains weak
At present, the demand for personal computers and smartphones in major global markets remains weak, leading to a decrease in inventory levels and an oversupply of memory chips.
According to research firm Gartner, the global shipment of personal computers in the third quarter of 2024 was 62.9 million units, a decrease of 1.3% compared to the same period last year.
In a company statement released before the conference call, Sanjay Mehrotra, CEO of Micron, said, "The PC update cycle is gradually unfolding, and we expect PC sales growth to remain flat in 2024, slightly lower than previous expectations... As time goes on, we remain optimistic about the popularity of artificial intelligence personal computers
He also said, "Although the consumer oriented market is relatively weak in the short term, we expect to return to growth in the second half of this fiscal year