Business
Micron Leads S&P 500 Gains After Strong Earnings Report
(CTN News) – Micron Technology (MU) witnessed a significant surge of over 8% in intraday trading on Thursday, leading the S&P 500 gains.
This remarkable increase came after the chipmaker announced better-than-expected results and expressed its anticipation of benefiting from the artificial intelligence (AI) boom.
In the fiscal first quarter of 2024, Micron reported revenue of $4.73 billion, surpassing last year’s $4.09 billion and exceeding the consensus estimates of $4.58 billion from Visible Alpha.
The company managed to narrow its losses from the previous quarter, recording a non-GAAP net loss of $1.05 billion compared to a net loss of $1.18 billion in the preceding quarter.
Furthermore, the adjusted earnings per share (EPS) showed improvement, with a loss of $0.95 per share compared to a loss of $1.07 per share in the previous quarter. Both figures exceeded expectations.
Micron also expressed its confidence in further reducing losses as it capitalizes on the AI boom.
CEO Sanjay Mehrotra stated, “We anticipate a continuous improvement in our business fundamentals throughout 2024, with a projected record industry TAM for calendar 2025.
Our industry-leading High Bandwidth Memory for data center AI applications demonstrates the strength of our technology and product roadmaps, positioning us favorably to seize the immense opportunities fueled by artificial intelligence across various end markets.”
Wedbush, UBS, and CFRA analysts have all expressed their belief that Micron is in a favorable position to benefit from the growing demand for AI technology.
UBS analyst Timothy Arcuri specifically stated that Micron is a top idea for 2024, highlighting the contrasting movements of supply and demand and the potential for higher pricing. CFRA Research’s vice president and senior equity analyst, Angelo Zino, expects semiconductor stocks, including Micron, to perform well in the coming year, although not as strongly as in 2023.
Zino also emphasized the rebound potential of memory, particularly on the DRAM side, due to the promising prospects of AI and high bandwidth memory.
As of Thursday afternoon, Micron shares were up 8.7% at $85.50 per share and have seen a significant increase of nearly 70% in 2023.
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