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Why Micron Stock Fell on Friday
MUMicron Technology(MU) The Motley Fool·2025-03-21 15:04

Core Viewpoint - Micron Technology's stock is considered a buy despite a recent 7% decline, as the company exceeded earnings expectations in its fiscal Q2 2025 report [1][4]. Financial Performance - Micron reported a revenue increase of 38% year over year, reaching over 8billion,butexperiencedasequentialdeclineof7.68 billion, but experienced a sequential decline of 7.6% from Q1 [2]. - Non-GAAP earnings were 1.56 per share, surpassing analyst expectations, while GAAP earnings were 1.41pershare,nearlydoublingfrom1.41 per share, nearly doubling from 0.71 a year ago [2]. - Operating cash flow more than tripled compared to the previous year [2]. Cash Flow and Guidance - The company's free cash flow remains slightly negative at 75million,butisshowingsignsofimprovement[3].−CEOSanjayMehrotraanticipatesrecordquarterlyrevenueinfiscalQ3,drivenbygrowthinDRAMandNANDdemandacrossdatacenterandconsumermarkets[4].FutureProjections−MicronforecastsQ3salesofapproximately75 million, but is showing signs of improvement [3]. - CEO Sanjay Mehrotra anticipates record quarterly revenue in fiscal Q3, driven by growth in DRAM and NAND demand across data center and consumer markets [4]. Future Projections - Micron forecasts Q3 sales of approximately 8.8 billion, with non-GAAP profit expected at 1.57pershareandGAAPearningsat1.57 per share and GAAP earnings at 1.37 per share [5]. - These projections indicate that Micron is on track to exceed earnings expectations for the fifth consecutive quarter [5]. Valuation Perspective - The stock is currently valued at only 15 times analyst forecasts for the year, suggesting it is undervalued given its performance [6].