Micron Technology Inc (NASDAQ:MU) stock fell 7.90% (As on March 21, 11:12:42 AM UTC-4, Source: Google Finance) after the company reported that margins will miss analysts’ estimates this quarter. Micron’s gross margins were 37.9% in the second quarter on an adjusted basis, missing the average 38.4% analyst estimate compiled by Bloomberg. MU forecast third-quarter revenue above Wall Street estimates, signaling strong demand for its high-bandwidth memory (HBM) chips used in AI models. Micron, which also offers flash memory NAND chips for the data storage market, expects DRAM and NAND demand growth in both data center and consumer-oriented markets, with significantly improved profitability in fiscal 2025 ending August. Micron’s net income grew to $1.58 billion, almost doubling from the $793 million profit it delivered in the same period last year. Micron said its sales growth was primarily driven by its newest high-bandwidth memory chips, which have become a key component of high-end AI servers. During the quarter, sales of HBM chips surpassed the $1 billion milestone for the first time, up 50% from the prior quarter. Operating cash flow was of $3.94 billion versus $3.24 billion for the prior quarter and $1.22 billion for the same period last year. For the second quarter of 2025, investments in capital expenditures, net were $3.09 billion and adjusted free cash flow was $857 million. Micron ended the quarter with cash, marketable investments, and restricted cash of $9.60 billion.

MU in the second quarter of FY25 has reported the adjusted earnings per share of $1.56, beating the analysts’ estimates for the adjusted earnings per share of $1.42. The company had reported the adjusted revenue growth of 38 percent to $8.05 billion in the second quarter of FY25, beating the analysts’ estimates for revenue of $7.89 billion.

Additionally, the company has declared a quarterly dividend of $0.115 per share, payable in cash on April 15, 2025, to shareholders of record as of the close of business on March 31, 2025.

Looking to the next quarter, Micron offered a forecast of $1.57 per share in earnings, coming in ahead of the Street’s guidance of $1.52.The company said it expects revenue of $8.80 billion, plus or minus $200 million for the third quarter, compared with an estimate of $8.5 billion, according to data compiled by LSEG. In addition, the company is seeing strong demand for the HBM supply in 2026 too, and are in discussions with customers on agreements for their calendar 2026. The company is also expecting personal computer sales to grow by a single-digit percentage this year. According to him, this will boost the company further as the next-generation AI PCs expected to drive that growth require substantially more memory than standard PCs.