Boost to Micron's Sales of AI Memory Chips; Shares Rise as Earnings Beat Expectations

Micron Technology Inc. saw its stock rise in after-hours trading on Thursday following the release of its fiscal second-quarter earnings, which highlighted continued benefits from artificial intelligence (AI) demand. The company’s highest-capacity memory products, particularly its high-bandwidth memory (HBM) chips, experienced significant growth.

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The memory-chip maker MU +0.92% exceeded Wall Street’s revenue and earnings expectations, largely due to strong sales of its HBM chips, which are essential for AI-driven data centers. Micron reported that revenue from these chips surpassed $1 billion in the second quarter, ending Feb. 27. This milestone exceeded the company’s own forecasts and marked a 50% increase from the previous quarter.

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“Micron is in the strongest competitive position in its history, and we are gaining market share across high-margin product categories,” Chief Executive Sanjay Mehrotra told analysts during a conference call.

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Following the earnings release, Micron’s stock initially surged over 5% in extended trading before settling with a gain of around 1% by the end of the session. Year to date, the stock has climbed approximately 22%, standing out amid a challenging period for semiconductor stocks.

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In contrast, the Philadelphia Semiconductor Index (SOX -0.72%) has declined 7.6% so far this year.

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Micron posted total fiscal second-quarter revenue of $8.0 billion, surpassing analysts’ expectations of $7.9 billion. On an adjusted basis, net income reached $1.78 billion, or $1.56 per share, exceeding Wall Street’s forecast of $1.43 per share, based on non-GAAP accounting.

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The company also delivered a strong outlook for its third quarter, projecting revenue of approximately $8.80 billion, with a possible variance of $200 million. This outlook is above analysts’ current consensus of $8.47 billion, according to FactSet.

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Mehrotra also revealed that Micron’s supply of HBM chips is already sold out for calendar year 2025. “We anticipate multi-billion-dollar revenue in fiscal 2025,” he stated. “Demand for our HBM chips remains strong for 2026, and we are currently in discussions with customers regarding supply agreements for that year.”

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Additionally, he noted that the personal computer (PC) market is expected to grow at a single-digit percentage rate this year. Mehrotra emphasized that AI-powered PCs require more memory than traditional PCs, contributing to increased demand for Micron’s products.

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