Micron Technology Inc., the leading US computer memory chip producer, experienced an 8.3% drop in shares after revealing that its gross margins for the second quarter missed analysts' expectations. The adjusted margin was reported at 37.9%, below the anticipated 38.4%, and forecasts for the upcoming quarter suggested further declines, primarily due to NAND flash memory pricing. Despite this setback, Micron projected strong fiscal third-quarter revenue of approximately $8.8 billion, driven by demand for AI-related components, even as traditional markets remain weak yet show signs of recovery.
Micron's gross margins were 37.9% in the second quarter on an adjusted basis, missing the average 38.4% analyst estimate, raising concerns about NAND pricing.
We will see a much better trajectory from us as the industry environment improves, particularly in NAND, says Executive Vice President Sumit Sadana.
Fiscal third-quarter revenue is expected to be about $8.8 billion, surpassing the average analyst estimate, supported by growing demand for artificial intelligence products.
Although traditional markets such as chips for phones and PCs remain weak, they show signs of recovery, with second-quarter sales climbing 38% to $8.05 billion.
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