Micron Technology Inc. (NYSE: MU), the American technology company, delivered strong first quarterly results of FY22 on Monday. It smashed Wall Street analysts’ expectations. The reason for strong results was increased demand for its chips, driven by data centers and electric vehicle manufacturers. Moreover, the company forecasts that it will beat the analyst estimates in its second-quarter results, and the chip shortage will be eased in 2022.
Micron has revealed that it has undertaken deals with its suppliers in order to ease the shortage in the supply chain. After announcing its results, the company’s stock jumped to $87.80, gaining by 5.7% in the extended trading session. However, yesterday the stock had closed at $82.03, down by 1.17%. In today’s pre-market session, it was priced at $88.95, up by 8.44% at 8:27 a.m. ET.
An acute shortage of chips in the industry and strong demand for the same enabled Micron to charge more for its output since it is one of the major chip manufacturers in the world. The data released by the company shows that data center revenue increased by 70%, and automobile revenue rose 25%.
Micron forecasts its second-quarter revenue of FY22 to be $7.5 billion (a change of about $200 million in this figure can be anticipated). However, the analysts estimate revenue to be $7.27 billion. In the current quarter, it expects adjusted earnings per share (EPS) of $1.95, which is higher than the analysts’ estimate of $1.86. This widened forecast gave a head start to the stock increment.
“Micron delivered solid fiscal first quarter results led by strong product portfolio momentum. We are now shipping our industry-leading DRAM and NAND technologies across major end markets, and we delivered new solutions to data center, client, mobile, graphics and automotive customers. As powerful secular trends including 5G, AI, and EV adoption fuel demand growth, our technology leadership and world-class execution position us to create significant shareholder value in fiscal 2022 and beyond.”-said Micron Technology President and CEO Sanjay Mehrotra.