Micron Expertise (MU) inventory soared Thursday after the memory-chip maker smashed estimates for its fiscal second quarter and guided above views for the present interval because of strong spending on data-center infrastructure for synthetic intelligence. Micron inventory notched a file excessive on the information, main a rally in semiconductor shares.
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Late Wednesday, Micron posted a shock revenue for its fiscal Q2 ended Feb. 29. Gross sales jumped 58% yr over yr to $5.82 billion. Adjusted earnings surged 122% on an absolute worth foundation to 42 cents a share.
Micron’s outcomes acquired a elevate from the AI infrastructure spending increase as prospects snapped up its high-bandwidth reminiscence DRAM chips. Plus, Micron noticed demand enhance throughout most of its finish markets, together with PCs and smartphones.
Different main chip shares additionally rose on Thursday, together with Broadcom (AVGO), Intel (INTC), Nvidia (NVDA) and TSMC (TSM).
“We’re within the very early innings of a multiyear development part pushed by AI as this disruptive expertise will remodel each side of enterprise and society,” Micron Chief Government Sanjay Mehrotra mentioned on a convention name with analysts.
“We view Micron as one of many greatest beneficiaries within the semiconductor business of this multiyear development alternative pushed by AI,” Mehrotra mentioned.
Micron Inventory Spikes After Report
Micron’s reminiscence chips will profit from AI development within the information heart and on edge gadgets. Plus, it should play a key function because the business chases the final word aim of “synthetic normal intelligence,” or AGI, Mehrotra mentioned. Synthetic normal intelligence is a kind of AI that may carry out as properly or higher than people on a variety of cognitive duties.
On the inventory market in the present day, Micron inventory jumped 14.1% to shut at 109.85. Earlier within the session, it hit an all-time excessive of 113.50.
The mixture of the Fed standing agency on anticipated rate of interest cuts coupled with bullish AI commentary on development and demand by Micron “is prone to reignite the AI semi FOMO (concern of lacking out) commerce,” Jordan Klein, managing director for tech, media and telecom sector buying and selling at Mizuho Securities, mentioned in a consumer be aware.
Micron Will get 20 Value-Goal Hikes
At the very least 20 Wall Avenue corporations raised their worth targets on Micron inventory after the earnings information.
“Micron earnings commentary ticked each field within the investor guidelines (after which some),” Wedbush Securities analyst Matt Bryson mentioned in a consumer be aware. That guidelines included a positive business outlook, growing common promoting costs and a mixture shift to larger margin merchandise.
Bryson reiterated his outperform ranking on Micron inventory and upped his worth goal to 130 from 103.
Rosenblatt Securities analyst Hans Mosesmann was much more bullish. He saved his purchase ranking on Micron inventory and elevated his worth goal to 225 from 140.
“The reminiscence cycle we’re about to witness would be the greatest in historical past, pushed by an AI cycle that’s revolutionizing compute in a secular style,” Mosesmann mentioned in a consumer be aware.
Raymond James analyst Srini Pajjuri raised his worth goal on Micron inventory to 130 from 100. He maintained his outperform ranking.
“HBM (excessive bandwidth reminiscence) is arguably the strongest secular driver the business has ever seen,” Pajjuri mentioned in a consumer be aware. “Administration said that HBM is totally bought out for calendar 2024 and the ‘overwhelming majority’ has already been allotted for calendar 2025.”
Comply with Patrick Seitz on X, previously Twitter, at @IBD_PSeitz for extra tales on client expertise, software program and semiconductor shares.
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