Micron’s Gross Margin Improves, Q2 Revenue Beat Estimate, Shares Rally (MU)
Notwithstanding wider than expected loss for the fiscal second quarter, Shares if Micron Technology Inc. (NASDAQ: MU) rallied on Friday after the memory chipmaker reported better-than-expected revenue and improved margin.
For the recently concluded quarter, Micron reported a loss of 28 cents a share while Wall Street’s estimate was for loss of 20 cents a share. This was the seventh straight quarterly loss as the Company reel under demanding business environment. Macroeconomic uncertainty, falling average selling price and flagging demand for PCs, all have put pressure on financials. However, investors welcomed Company’s optimistic view on DRAM and NAND markets.
Revenue during the period climbed 3.4% to $2.08 billion, beating analysts’ consensus estimate for revenue of $1.91 billion. Revenue mainly improved due to higher shipments of DRAM and NAND shipments.
While revenue from DRAM jumped 24%, sales volume climbed 38%. Revenue from NAND rose 8% while sale volume increased 13%.
For the quarter gross margin came at 17.6% while analysts at Stifel Nicolaus & Co. forecasted gross margin of 12%.
For the current quarter, Micron Technology anticipates equilibrium between supply and demand for both DRAM and NAND. Bit costs are expected fall to mid-single digits while bit production is expected between upper middle and higher single digits.
The Company also anticipates SG&A expense between $135.0 million and $145.0 million while research and development expenses are expected to between $225.0 million and $235.0 million
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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