Last updated: June 29, 2023, 5:19 AM IST
New York, United States of America (USA)
A sign marks the entrance to Micron Technology’s automotive chip plant on Feb. 11, 2022 in Manassas, Virginia (AP Photo, File)
Shares of the company were up about 3% in post-bell trading. They’ve gained about 34% this year
Micron Technology beat analyst estimates for third-quarter revenue on Wednesday, driven by demand for its memory chips from the burgeoning artificial intelligence sector.
Shares of the company were up about 3% in post-bell trading. They’ve gained about 34% this year.
CEO Sanjay Mehrotra said customers continued to reduce their excess inventories in the quarter, with inventories in the PC and smartphone segments staying close to normal levels.
As a result, Micron is seeing improved pricing trends and greater confidence that the industry has passed the bottom for growth and revenue, he added.
Micron reported revenue of $3.75 billion for the quarter ended May 31, compared to estimates of $3.65 billion, according to Refinitiv IBES data.
Rising demand from the generative AI sector, which has gained more investor attention following the viral popularity of OpenAI’s ChatGPT, has helped bolster sales amid weakness in Micron’s traditional smartphone and PC markets.
The proliferation of generative AI is likely to drive a surge in demand for data to feed large language models and could increase the need for more storage chips, analysts said.
US chip makers are also getting caught up in the US-China technology spat. Last month, China’s cyberspace regulator failed Micron’s products in a safety assessment and banned operators from purchasing key infrastructure.
Micron, the largest memory chip maker in the US, has said it expects the ban to affect about half of its revenue from companies headquartered in China, representing a low double-digit percentage of total revenue.
The company reiterated that several of its customers, including phone manufacturers, have been approached by Chinese government representatives about the future use of the company’s products.
Micron fourth quarter revenues of $3.9 billion plus or minus $200 million for the quarter ended Aug. 31, broadly in line with expectations.
The company, which makes DRAM and NAND flash memory chips, reported a net loss of $1.9 billion for the third quarter, compared to a profit of $2.63 billion a year earlier.
(This story has not been edited by News18 staff and was published from a syndicated news agency feed – Reuters)
