How Micron's earnings results could impact chip ETFs

What we drew from this source

The claims Via News extracted from this document. We point to the source; we don't replace it.

• Micron's earnings are important but not make-or-break for the AI trade; it is an interstitial report due to its different reporting cadence

  60% confidence

• Micron's high margins stem from supply constraints; if it could make more it would, and the margin would fall, so it may be unsustainable

  60% confidence

• Over the last 11 prints Micron's stock has split the difference between rising and falling; it likely needs a huge print to be at least moderately rewarded

  60% confidence

• Consensus expects EPS growth of 951%, revenue growth of 355% and a gross margin of 86.2% for Micron

  60% confidence

• Conditions for Micron are still very good and Morgan Stanley is overweight, but post-report estimate increases may be smaller than in past quarters

  60% confidence

• There are 57 buy ratings, four holds and zero sells on Micron; the bull case rests on long-term multi-year supply agreements and a data center build-out with no end in sight

  60% confidence

• Channel checks suggest third-quarter DRAM prices are up 20 to 30% quarter over quarter despite long-term agreements, NAND pricing is up 15%, and prices should keep rising in the fourth quarter

  60% confidence

• Samsung most recently said it was swinging back toward producing lower-end memory

  60% confidence

• Automakers such as GM cited being unable to get enough lower-end memory chips, a real demand signal

  60% confidence

Cited in these Via News reports

• Micron's Spending Doubled and Its Cash Pile Grew 2.5x as AI Chip Dealmaking Accelerates →
• Micron's Spending Has Roughly Doubled as AI Strains the Chip Supply, and Rivals Are Racing for Alternatives →
• Micron's Spending Nearly Doubled in a Year as the AI Memory Squeeze Reshapes the Chip Industry →