A sharp drop of about 8% outside of MU hours! HBM is also expected to raise prices

According to financial results, in the third quarter that ended on 5/30, Micron's adjusted sales increased 82% to 6.81 billion dollars, exceeding analysts' expectations of 6.67 billion dollars.

Earnings per share excluding specific items were 62 cents, which also exceeded analysts' expectations of 50 cents.

Also, in the guidance section, Micron Technology will be in the fourth quarter of the fiscal year ending in August

The company's sales reached 7.8 billion dollars from 7.4 billion dollars, and the median forecast of 7.58 billion dollars is already slightly above the average value of 7.58 billion dollars expected by analysts, but even so, it cannot meet the high expectations of the market -- especially since some analysts expected Micron to release a figure of 8 billion dollars or more, that is also expected to fall short.

At the same time, Micron expects earnings per share for the fourth quarter to be around $1.08, which is also only “slightly above” the $1.02 expected by the market.

Micron fell 7.98% in overtime trading. In total, Micron shares have risen 67%. This also shows the extent of investors' expectations.

Amid the artificial intelligence boom, Micron's HBM chip data is particularly interesting. According to the financial report, sales of Micron's HBM3e chips reached 100 million dollars in the third fiscal quarter, and are expected to rise to “hundreds of millions of dollars” in the fourth fiscal quarter. Micron also expects this figure to rise to “several billion dollars” by the 2025 fiscal year.

Micron also revealed that orders for HBM chips have been filled even after 2025.

As an HBM supplier for large customers such as NVIDIA, increasing HBM production was the most important issue for Micron facing strong demand for artificial intelligence.

Manish Bhatia, Micron's executive vice president in charge of global business, stated in an interview that HBM's supply growth is effectively “braked” because it is difficult to increase production volume at factories and link chips to the system.

Given these restrictions, the company anticipates that HBM prices will rise steadily.

Micron plans to invest approximately $8 billion in new plants and equipment in 2024 to support plant construction in Idaho and New York. However, Micron revealed that the Idaho plant will contribute to supply expansion after 2027, and the New York plant is scheduled to operate in 2028.

In contrast to the intense demand for HBM chips, the PC and smartphone markets, which are Micron's traditional business fields, have fallen quite a bit.

Micron CEO Sanjay Meherotra emphasized in his financial results announcement that the smartphone and PC markets are still sluggish.

According to Micron, PC sales are expected to grow in the first half of the single-digit range (that is, about 1 to 4%) until 2024. Smartphone sales are expected to grow to the middle of the first half of the single-digit range (in other words, about 1 to 7%).

However, the company anticipates that artificial intelligence functions will contribute to stimulating demand for mobile phones and PCs by 2025.

Sanjay Meherotra, the company's chief executive officer (CEO), once again stated that the memory chip industry will recover in 2024, and record high sales will be recorded in 2025.