Micron Technology Inc, the largest US maker of memory chips, gave an upbeat forecast for the current quarter, a sign that demand remains strong from rapidly expanding data center customers.
Sales would be about US$8.7 billion in its fiscal third quarter, Micron said in a statement on Tuesday.
That compares with an average analyst estimate of US$8.2 billion, according to data compiled by Bloomberg.
Photo: Reuters
Excluding certain items, profit would be about US$2.46 a share, topping the US$2.24 prediction.
Memory chips are used in a wide range of devices, making them less subject to fluctuations in demand for PCs and smartphones. That has helped Micron continue to grow even as the PC market slows.
Data center sales have been a particular bright spot, surging more than 60 percent last quarter. Industrial sales also gained about 60 percent in the period, and automaker revenue set a record.
While the number of PCs and smartphones being shipped is not growing, the amount of memory those devices need is, Micron chief executive officer Sanjay Mehrotra said.
“Micron is looking at a record year in fiscal 2022,” he said in an interview. “Our end-market demand is strong, our customers’ demand is strong and supply is constrained.”
In the three months that ended on March 3, Micron’s revenue grew 25 percent to US$7.79 billion. Net income was US$2.26 billion, or US$2 a share, up from US$603 million, or US$0.53, a year earlier.
Micron competes with South Korea’s Samsung Electronics Co and SK Hynix Inc, as well as Japan’s Kioxia Holdings Corp.
DRAM chips hold information temporarily, helping processors crunch data. NAND flash memory, meanwhile, acts as permanent storage in smartphones and computers. Recent production problems at Kioxia plants caused some of its products to be unusable, helping boost prices of NAND semiconductors. Samsung dominates production of both major types of chips.
Historically, the PC market has driven demand for memory. That industry enjoyed a surge during the COVID-19 pandemic, fueled in part by stuck-at-home workers buying new equipment.
However, it has slowed more recently.
Micron said on Tuesday that it expects PC shipments to be flat this year compared with last year.
The Russian invasion of Ukraine would not affect Micron’s production, but the region’s role as a source of gases and some minerals used in chip manufacturing means that some costs might go up, the company said.
The return of lockdowns in China related to the COVID-19 pandemic represents a risk to the electronics supply chain, Mehrotra said.
As with many companies, the price of energy, transport, raw materials and wages are going up, he said.
Micron is able to offset this inflationary pressure by improving its production techniques to make itself more efficient.
It is doing that faster than its competitors, he said.
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