Micron Technology, the largest US maker of computer memory chips, saw its shares rise dramatically after the company released an optimistic forecast for the current quarter. This surge, the largest in eight months, signals that increased demand and ongoing supply shortages are enabling the company to charge more for its products.
For the fiscal second quarter, Micron anticipates revenue between $US18.3 billion and $US19.1 billion. This exceeds analysts’ average estimate of $US14.4 billion for the same period. The company projects a profit, excluding certain items, of $US8.22 to $US8.62 per share, significantly higher than the previously estimated $US4.71.
Following the announcement, Micron shares jumped as much as 17 per cent after markets opened in New York on Thursday (Friday AEDT), marking the largest intraday gain since April 9. Before this surge, the stock had already increased by 168 per cent this year, closing at $US225.52 on Wednesday. Micron Technology is positioned as an essential AI enabler, providing memory and storage solutions. The company invests in supporting its customers’ expanding needs in these areas.
The high demand for AI computing components is currently outpacing supply, which is proving beneficial for companies like Micron. Shortages of less sophisticated memory used in personal computers also contribute to the company’s success. This is partly due to the memory industry’s shift in production towards more advanced technology catering to AI data centres.
