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Important points
- Micron shares soared in after-hours trading Wednesday after the company beat Wall Street’s quarterly expectations and released better-than-expected guidance for the current quarter on the back of demand for AI.
- CEO Sanjay Mehrotra expects further price increases across memory and storage end markets throughout this year, which he expects will lead to higher revenue and profitability in fiscal 2025.
- Micron stock may have future price support near $98 from the high of the previous double top pattern.
Micron Technology (MU) shares rose Wednesday after the memory and storage chip maker reported quarterly results that beat Wall Street expectations and said it expected to beat expectations amid artificial intelligence (AI)-driven demand. The stock soared 18% in after-hours trading.
The Boise, Idaho-based company posted adjusted earnings of 42 cents per share in its fiscal second quarter, up from a loss of $1.91 per share in the year-ago period and significantly exceeding analysts’ loss expectations. exceeded. Revenue for the period was $5.82 billion, up from $3.69 billion in the same period last year and easily beating the consensus estimate of $5.34 billion.
Looking ahead, the memory chip maker expects interim adjusted earnings of 45 cents per share for the current quarter on revenue of $6.6 billion plus or minus $200 million. Both metrics far exceeded street expectations of $5.98 billion in revenue and 8 cents per share.
“Micron believes we are one of the largest beneficiaries in the semiconductor industry of the multi-year opportunities enabled by AI,” Sanjay Mehrotra, CEO of Micron, said in a statement accompanying the quarterly results. “There is,” he said.
Mehrotra also said in prepared remarks that demand for AI servers is tightening the relationship between supply and demand, which is helping Micron benefit from significant price increases across all memory and storage end markets. He pointed out that there was. He expects price levels to rise further throughout this year, adding that FY2025 is expected to see record revenues and significant improvement in profitability.
Looking at the weekly chart, Micron stock broke out of its 16-month upward channel in late February, hitting new all-time highs in the process. But since then, the stock has consolidated on average volume around the pattern’s highest trendline as investors wait and see before the company’s earnings release.
Note the previous double top pattern that formed on the chart near $98 during the post-closure breakout. This area can turn into a future price support level during a retracement.
Micron shares rose 18.2% to $113.75 in after-hours trading Wednesday. The company’s stock has risen more than 60% in the past 12 months, hitting an intraday high of $101.85 earlier this month.
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