Micron Technology Inc (NASDAQ:MU) announced its fiscal third quarter earnings after the bell Wednesday, beating analyst estimates on earnings and revenue and seeing a 40% increase in sales.
The chipmaker reported earnings of US$3.15 per share on revenue of US$7.80bn compared with US$1.62 on revenue of US$5.57bn in the previous year’s third quarter.
The Idaho-based tech company surpassed Wall Street estimates of US$3.13 EPS on revenue of $7.76bn.
"Micron delivered record results in financial performance for the third fiscal quarter, supported by strong execution and ongoing secular demand trends," said CEO Sanjay Mehrotra in a press statement.
"We strengthened our competitive position and grew our revenue across virtually all of our high-value product segments,” he added.
Chinese regulators have been looking into memory chip manufacturers including Micron as well as Samsung Electronics Co Ltd and others. China, which accounts for around one-quarter of the world’s demand, has set up talks with Micron executives to discuss the rising price of memory chips.
Analysts weigh in on Micron
Baird Equity Research has high hopes for Micron, encouraged by the company’s improvement in fundamentals.
“Company-specific fundamental improvements were evident in the quarter: improving mix driving Micron's NAND pricing up QoQ, better-than-industry reductions in production costs, and market share gains in data centers,” wrote analyst Tristan Gerra in a note.
READ: Chipmaker Micron Technology's outlook looks rosy as demand for DRAM and NAND flash memory chips surges
Demand is forecasted to remain strong for its dynamic random-access memory chips. The analyst estimated the use of DRAM content in data centers will jump more than 30% this year.
He reiterated his Outperform rating with a price target of US$100.
JP Morgan analysts forecast Micron shares to climb even higher as the growing cloud computing market leads to a growing demand for its memory chips.
"Stay long Micron heading into earnings. We see further upside in Micron shares as the team is executing well in an overall constructive S/D [supply/demand] memory environment," analyst Harlan Sur said in a note shared by CNBC.
JP Morgan recently conducted a survey of chief information officers and results suggest that cloud computing workloads may quadruple in the next five years.
The analyst maintained an Overweight rating with a price target of US$82.
Shares of Micron were up more than 4% to US$61.40 in Thursday pre-market trading.
--Updated to include recent analyst note and latest share price