Giant chipmaker Micron Technology (NASDAQ:MU) is on the roll as it announced upbeat earnings results following surge in memory chips that is in the meantime hurting other tech giants, and the company is hoping for further improvement in coming days.
Micron Technology (NASDAQ:MU) said its second-quarter revenue surged 58% to $4.65 billion, bolstered by strong demand and rising prices for its memory chips, as well as through efficient process it managed to cut costs. Overall combined gross margins surged to 36.7% of revenue, up from 20% year over year.
Meanwhile controlled supplies and surging demand for the DRAM and NAND memory Micron produces steered to a price surge, affecting some hardware firm’s financial results, including HP Inc. HPQ, Hewlett Packard Enterprise Co. HPE, and Cisco Systems Inc. CSCO, Micron broke down the extreme swing in prices and demand Thursday: DRAM memory chips surged 21% in price from just the previous three months period, while NAND sales volume rose 18% in the same period.
A nearly 40-year-old chip maker supported that view with a blowout predictions for the current quarter, anticipating adjusted earnings of $1.43 to $1.57 a share on revenue of $5.2 billion to $5.6 billion. That forecast destroyed analysts’ average outlook of 91 cents a share on sales of $4.74 billion, and in the result boosted Micron stock in Thursday’s after-hours session.
On the Friday morning, the stock surged 9.6% to the highest level seen since May 2015. Volume surpassed 37 million shares in the first half hour after the open, exceeding the full-day average of about 26 million shares, and enough to make the stock the most actively traded on major U.S. exchanges.
Furthermore Micron Technology (MU) also said in a statement that more customers looking to establish more long-term contracts, as a way of securing more supply.