Micron (MU) blew it out of the water on its earnings day Wednesday evening.
The top headline is that the memory chip maker beat sales and profit forecasts for the quarter due to voracious demand from the AI boom. Guidance was also strong, except for comments on margins during the earnings announcement (which could cause a muted premarket reaction).
But keep Micron’s quarter in context.
Consider this: Micron added about $43 billion in sales in the most recent quarter compared to last year’s quarter. It’s huge. Operating margins have exploded in all business segments.
The market is forward-looking, so the race is on to predict Micron’s results over the next 12 months. Don’t lose sight of what this company is doing right now; that’s all we’re saying.
Here’s how Wall Street views Micron’s quarter and outlook:
“While Micron once again delivered a strong quarter and provided above-consensus guidance for the first quarter of 2027, the most important takeaway was management’s indication that memory markets could be even tighter in 2028 than they are today. We believe expectations of tightening supply and demand conditions through 2027 and 2028 significantly broaden the sector’s runway for strong price and earnings growth, addressing a key investor concern that current fundamentals represent a cyclical peak. -Gil Luria, DA Davidson analyst
“MU delivered a decisive move alongside a significant increase in SCA coverage, an improved view of supply-demand tightening, and confirmation of an almost certain capital return pivot – all factors that we believe will ultimately dictate the strong multi-year earnings power narrative from here.” -Harlan Sur, analyst at JPMorgan
“Implications for Japanese SPE Companies: Investment forecasts for FY28/27 project a nearly 2x increase from the previous year, although much of the increase is due to fab construction. is improving. Ahead of the July-September quarter results, we recommend KOKUSAI, which should benefit from increased memory demand. Among small and medium capital expenditures, we recommend Tokyo Seimitsu and Rorze. -Edison Lee, analyst at Jefferies
Brian Sozzi is the editor-in-chief of Yahoo Finance, host of the Sozzi unleashed morning show, the ‘Powerful actors with Brian Sozzi podcast and member of the Yahoo Finance editorial leadership team. Follow Sozzi on @BrianSozzi, InstagramAnd LinkedIn. Any advice on stories? Email brian.sozzi@yahoofinance.com.
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