Micron Shares Drop on Weak Second-Quarter Guidance in Los Angeles
Micron, the chipmaker, saw its shares drop by 12% in late trading after sharing a weaker-than-expected outlook for the second quarter. Although the company’s first-quarter revenue met analysts’ expectations, its earnings exceeded them.
In more detail, Micron’s adjusted earnings per share stood at $1.79, slightly above the anticipated $1.75 figure. Revenue for the same period matched analysts’ estimates at $8.71 billion.
Looking ahead to the second quarter, Micron forecasts revenue of $7.9 billion, give or take $200 million, and adjusted earnings per share of $1.43, with a margin of plus or minus 10 cents. This guidance was below what analysts were anticipating, with revenue expected to reach $8.98 billion and EPS predicted to hit $1.91.
As a company, Micron has experienced a 22% increase in its shares so far this year, underperforming compared to the Nasdaq’s 29% rise. In their latest earnings report, Micron spotlighted data centers and artificial intelligence projects involving Nvidia’s processors as key areas for growth.
CEO Sanjay Mehrotra shared in a press release that although consumer markets might be facing near-term challenges, they anticipate growth in the latter half of the fiscal year. The emphasis is on high-margin segments of the market and harnessing the potential of AI-driven expansion to create significant value for stakeholders.
So, while the recent news may have caused a temporary dip in Micron’s stock, the company seems to be eyeing long-term growth opportunities and remains optimistic in its strategic positioning for the future.
