It has been a few month because the final earnings report for Micron (MU). Shares have added about 17.8% in that timeframe, outperforming the S&P 500.
Will the latest constructive development proceed main as much as its subsequent earnings launch, or is Micron due for a pullback? Earlier than we dive into how buyers and analysts have reacted as of late, let’s take a fast have a look at the newest earnings report so as to get a greater deal with on the necessary catalysts.
Micron Beats Q1 Earnings Estimate, Revenues Matches
Micron reported first-quarter fiscal 2025 earnings of $1.79 per share, beating the Zacks Consensus Estimate by 2.3%. The corporate had incurred a lack of 95 cents per share within the year-ago interval.
Micron’s revenues elevated 84.3% yr over yr to $8.71 billion and matched the Zacks Consensus Estimate.
Micron Q1 High-Line Particulars
Know-how-wise, DRAM revenues of $6.4 billion, accounting for 73% of the whole revenues within the fiscal first quarter, elevated 87% yr over yr and 20% sequentially. The corporate skilled sturdy demand for knowledge middle DRAM, together with HBM.
NAND revenues of $2.2 billion, representing 26% of the whole revenues, had been up 82% yr over yr however decreased 5% quarter over quarter.
Different revenues had been $68 million within the reported quarter, down from $69 million within the year-ago quarter and up from $59 million within the earlier quarter.
Enterprise segment-wise, revenues of $4.4 billion from the Compute and Networking Enterprise Unit soared 153% from the year-ago quarter and 46% sequentially. Revenues of $1.5 billion from the Cell Enterprise Unit jumped 16.3% on a year-over-year foundation and 19% on a quarter-over-quarter foundation.
The Embedded Enterprise Unit’s revenues had been $1.1 billion, up 5.8% from the year-ago interval however down 10% from the earlier quarter. Revenues from the Storage Enterprise Unit, comprising solid-state drive NAND elements, totaled $1.7 billion, up 160% yr over yr and three% sequentially.
Micron’s Q1 Working Particulars
For the fiscal first quarter, Micron posted a non-GAAP gross revenue of $3.35 billion, representing a strong enchancment from the earlier quarter’s $2.74 billion. The corporate reported a non-GAAP gross lack of $35 million within the year-ago quarter. The primary-quarter non-GAAP gross margin of 39.5% additionally improved from the earlier quarter’s 36.5%. Within the year-ago quarter, it had registered a gross margin of 0.8%.
Non-GAAP working bills had been $1.05 billion in contrast with the earlier quarter’s $1.08 billion and the year-ago quarter’s $992 million.
Micron’s non-GAAP working earnings of $2.39 billion was means greater than the earlier quarter’s non-GAAP working earnings of $1.75 million. It additionally reveals enchancment from the year-ago quarter’s non-GAAP working lack of $955 million.
The non-GAAP working margin got here in at 27.5%. Micron posted a non-GAAP working margin of twenty-two.5% for the fourth quarter of fiscal 2024, whereas it had a non-GAAP working margin of adverse 20.2%.
Micron’s Steadiness Sheet & Money Movement
Micron exited the reported quarter with money and investments of $7.58 billion in contrast with the $9.16 billion recorded on the finish of the prior quarter. It ended the quarter with whole liquidity of $11.2 billion, flat quarter over quarter.
Micron’s whole debt, as of Nov. 28, 2024, was $13.7 billion in contrast with the $13.4 billion witnessed on the finish of the fourth quarter of fiscal 2024.
The corporate generated an working money circulation of $3.24 billion within the first quarter. It spent $3.2 billion on capital expenditure in the course of the quarter, leading to an adjusted free money circulation of $112 million. MU paid out $131 million in dividends however repurchased no shares within the first quarter of fiscal 2025.
Micron’s Q2 Outlook
Micron guided for the second quarter of fiscal 2025. The corporate anticipates revenues to be $7.90 billion (+/-$200 million) within the fiscal second quarter. For the fiscal second quarter, MU initiatives a non-GAAP gross margin of 38.5% (+/-100 foundation factors). Working bills on a non-GAAP foundation are estimated to be $1.10 billion (+/-$15 million). Adjusted EPS is anticipated to be $1.43 (+/- 10 cents).
How Have Estimates Been Shifting Since Then?
It seems, estimates revision have trended downward in the course of the previous month.
The consensus estimate has shifted -28.81% as a result of these adjustments.
VGM Scores
At present, Micron has an important Progress Rating of A, although it’s lagging loads on the Momentum Rating entrance with an F. Nonetheless, the inventory was allotted a grade of C on the worth facet, placing it within the center 20% for this funding technique.
General, the inventory has an combination VGM Rating of B. When you aren’t centered on one technique, this rating is the one you ought to be fascinated about.
Outlook
Estimates have been broadly trending downward for the inventory, and the magnitude of those revisions signifies a downward shift. Notably, Micron has a Zacks Rank #3 (Maintain). We anticipate an in-line return from the inventory within the subsequent few months.
Efficiency of an Business Participant
Micron is a part of the Zacks Laptop – Built-in Techniques trade. Over the previous month, Hewlett Packard Enterprise (HPE), a inventory from the identical trade, has gained 12.1%. The corporate reported its outcomes for the quarter ended October 2024 greater than a month in the past.
Hewlett Packard Enterprise reported revenues of $8.46 billion within the final reported quarter, representing a year-over-year change of +15.1%. EPS of $0.58 for a similar interval compares with $0.52 a yr in the past.
Hewlett Packard Enterprise is predicted to publish earnings of $0.50 per share for the present quarter, representing a year-over-year change of +4.2%. During the last 30 days, the Zacks Consensus Estimate has modified -0.4%.
Hewlett Packard Enterprise has a Zacks Rank #3 (Maintain) based mostly on the general course and magnitude of estimate revisions. Moreover, the inventory has a VGM Rating of B.
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Micron Technology, Inc. (MU) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the writer and don’t essentially replicate these of Nasdaq, Inc.
