FX.co ★ Micron Technology Stock Dips On Q4 Outlook, Despite Better-than-expected Q3 Results

Micron Technology, Inc. (MU) experienced an approximate 8% decline in its stock price during extended trading on Wednesday on the Nasdaq. This decline continued into pre-market trading, where shares fell around 6%. The downturn followed the chipmaker's release of its fourth-quarter outlook. Despite this, the company reported a profit for its third quarter, reversing a loss from the previous year and surpassing market expectations, with significant revenue growth.

For the fourth quarter, Micron projects earnings per share (EPS) of $0.61, plus or minus $0.08, on a reported basis, and adjusted EPS of $1.08, plus or minus $0.08. The company forecasts revenue of $7.60 billion, with a margin of error of $200 million for the quarter.

Analysts, on average, anticipate the company to report EPS of $1.05 on revenue of $7.6 billion, based on data compiled by Thomson Reuters, excluding any special items.

Sanjay Mehrotra, President and CEO of Micron Technology, remarked, "Robust AI demand and strong execution enabled Micron to drive 17% sequential revenue growth, exceeding our guidance range in fiscal Q3. We are gaining share in high-margin products like High Bandwidth Memory (HBM), and our data center SSD revenue hit a record high, demonstrating the strength of our AI product portfolio across DRAM and NAND. We are excited about the expanding AI-driven opportunities ahead, and are well-positioned to deliver a substantial revenue record in fiscal 2025."

In the third quarter, Micron reported net income of $332 million, or $0.30 per share, compared to a loss of $1.90 billion, or $1.73 per share, a year ago. Adjusted net income stood at $702 million, or $0.62 per share, in contrast to a loss of $1.57 billion, or $1.43 per share, the previous year.

Analysts had projected an EPS of $0.51 for the quarter.

Revenue reached $6.81 billion, a substantial rise from $3.75 billion in the same period last year, and also higher than the $5.82 billion forecast.

The company highlighted that AI demand fueled a 50% sequential growth in data center revenue, achieving a record high data center revenue mix.

Additionally, Micron's Board of Directors declared a quarterly dividend of $0.115 per share, payable in cash on July 23, to shareholders of record as of the close of business on July 8.

Micron Technology shares ended Wednesday's regular trading session at $142.36, up 0.9%. However, in extended trading, the shares dropped 8% to $131.00. In pre-market trading, the shares are now priced at $134.44, down 5.56%.