Micron Technology, Inc. (NASDAQ: MU) stock rise expected?

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Option traders positions surged in Micron Technology, Inc. (NASDAQ: MU) stock before its earnings release.

Micron Technology, Inc. (NASDAQ: MU) stock surged 13.1% on 26th June, 2019 (As of 1:34 pm GMT-4; Source: Google finance) after the company has posted better than expected results for the second quarter of FY 19.

Micron Technology, Inc. (NASDAQ: MU) stock rise expected?

In April, MU broke ground on the new cleanroom in Taichung, Taiwan. And earlier this month, the company announced the opening of the new cleanroom in Hiroshima, Japan. These cleanroom expansions will enable future DRAM node transitions of the existing wafer capacity. In NAND the company continue to ramp the 96-layer 3D NAND and are on track to achieve healthy cost declines in fiscal 2019.

MU in the third quarter of FY 19 has reported the adjusted earnings per share of $1.05, beating the analysts’ estimates for the adjusted earnings per share by 22 cents. The company had reported 39 percent fall in the adjusted revenue to $4.79 billion in the third quarter of FY 19, beating the analysts’ estimates for revenue by $18 million. . Both DRAM and NAND revenue were negatively impacted by the restriction on sales to Huawei without which the company would have reached the high end of the revenue guidance.

DRAM revenue was approximately $3 billion, representing 64% of total revenue. DRAM revenue declined 45% year-over-year and 19% sequentially from the fiscal second quarter. Compared to the prior quarter, the DRAM ASP decline approached 20% while bit shipments were roughly flat. NAND revenue was approximately $1.5 billion, representing 31% of total revenue. NAND revenue declined 25% relative to fiscal third quarter 2018 and declined 18% sequentially from the fiscal second quarter. Overall NAND ASPs declined in the mid-teens percent range, while shipment quantities declined in the mid-single digit percent range compared to the prior quarter.

Moreover, the revenue for the Compute and Networking business unit was $2.1 billion, down 48% year-over-year and 13% from the prior quarter. Lower pricing across major market segments continue to be the leading cause of lower revenue. Revenue for the mobile business unit was $1.2 billion, down 33% year-over-year and down 27% from the fiscal second quarter, due in part to lower shipments to Huawei. Lower pricing and DRAM volume drove the quarter-over-quarter decline. the storage business unit third quarter revenue was $813 million, down 29% year-over-year and down 20% quarter-over-quarter. The sequential decline was driven by competitive pricing and an unfavorable comparison on component volumes coming up a large one-time sale we completed in the prior fiscal quarter.

 

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