Micron Technology (MU) is set to release its third-quarter earnings for fiscal year 2024 after the market closes on Wednesday. Investors are eagerly anticipating updates on how the company is benefiting from the growing demand for artificial intelligence (AI) and its strategic partnership with AI leader Nvidia (NVDA).
Analysts forecast Micron’s third-quarter revenue to reach $6.7 billion, a notable increase from both the previous quarter and the same period last year, according to estimates compiled by Visible Alpha. Expected net income stands at $399.39 million, a stark contrast to the $1.9 billion loss reported in the fiscal third quarter of 2023. Diluted earnings per share (EPS) are projected to be 30 cents, up from a loss of $1.73 per share year-over-year.
Analyst Estimates for Q3 FY 2024:
Revenue: $6.7 billion (up from $5.82 billion in Q2 FY 2024 and $3.75 billion in Q3 FY 2023)
Diluted EPS: 30 cents (down from 71 cents in Q2 FY 2024, up from a loss of $1.73 in Q3 FY 2023)
Net Income: $399.39 million (down from $793 million in Q2 FY 2024, up from a loss of $1.9 billion in Q3 FY 2023)
Anticipated Strong Guidance
Analysts from J.P. Morgan and Citi expect Micron to deliver stronger-than-anticipated guidance for the fourth quarter, potentially driving the stock higher. J.P. Morgan analysts predict that “August quarter EPS will be guided higher versus consensus expectations.” They also expect Micron to reaffirm its outlook on rising prices for DRAM (Dynamic Random-Access Memory) and NAND storage technologies, with visibility into strong high-bandwidth memory (HBM) shipments and pricing extending into 2026.
Citi analysts are similarly optimistic, forecasting that Micron will provide results and guidance surpassing consensus due to the DRAM market upturn and increased AI memory demand. They project fourth-quarter revenue guidance to be around $8 billion and have raised their price target for Micron’s stock to $175 from $150, marking it as a “top pick.”
Strategic Partnership with Nvidia
Micron’s partnership with Nvidia, a key player in the AI chip market, is a significant growth driver. Micron supplies high-bandwidth memory chips for Nvidia’s AI graphic processing units (GPUs), positioning itself to benefit from Nvidia’s market success. J.P. Morgan analysts highlight that Micron’s robust HBM ramp into Nvidia GPUs underpins their expectations for strong future guidance.
Micron shares have surged over 62% since the beginning of the year, closing at $139.01 on Monday. As the company prepares to report its earnings, all eyes will be on its performance and outlook in the booming AI sector.
