Can This Chip Stock Take on NVIDIA?

With a market capitalization of $310.4 billion, NVIDIA provides graphics, computing, and networking solutions. The company is well known for its GPUs.

The company faced a significant decline in its graphics segment business, which led to a fall in revenue and gross margins in the last reported quarter. Falling demand for GPUs and pricing power led to the segment reporting a 44% sequential drop.

NVDA provided weaker-than-expected guidance for the third quarter of fiscal 2023. It expects revenues of $5.90 billion, which means a nearly 12% sequential decrease.

On the other hand, chip maker Micron Technology, Inc. designs, manufactures and sells storage products globally. It operates through the Compute and Networking Business Unit, Mobile Business Unit, Storage Business Unit, and Embedded Business Unit.

MU offers DRAM products, dynamic random access memory semiconductor devices that provide high-speed data retrieval. The devices are used widely in data centers, personal computers, and other devices.

Earlier this month, MU broke ground for a $15 billion factory in Boise, Idaho. This is the first new memory manufacturing fab built in the U.S. in two decades. The company also announced another plant to be made in the U.S. Once operational; the U.S. plants are expected to account for 40% of MU’s DRAM production volume globally, up from 10% currently.

On June 30, 2022, MU’s President and CEO said, “Recently, the industry demand environment has weakened, and we are taking action to moderate our supply growth in fiscal 2023.” “We are confident about the long-term secular demand for memory and storage and are well positioned to deliver strong cross-cycle financial performance.”