Micron Technology(US:MU) Hua Er Jie Jian Wen·2025-12-18 07:34Core Insights - Micron Technology's latest earnings report and guidance exceeded Wall Street expectations, with some analysts viewing it as a historic turning point in profitability, while others express concerns about potential price declines in high bandwidth memory (HBM) by 2026 due to increased supply [1][3][6] Financial Performance - Micron's revenue guidance for the next fiscal quarter is projected at $18.7 billion, significantly above the market expectation of $14.5 billion [1] - The company anticipates a non-GAAP gross margin of approximately 68%, well above the analyst forecast of 55%, indicating a historic leap in profitability [1][4] - The average selling prices (ASP) for DRAM and NAND are expected to rise, with DRAM ASP projected to increase by 30% and NAND by 40% quarter-over-quarter [4] Market Reactions - The strong earnings guidance led to a rapid increase in target prices from multiple institutions, with Morgan Stanley noting the unprecedented nature of the revenue and profit revisions in the semiconductor sector [3][4] - Barclays described the quarter as "explosive," highlighting the significant extent of the earnings beat despite prior market expectations [4] Capital Expenditure and Supply Outlook - Micron raised its net capital expenditure for fiscal 2026 from $18 billion to approximately $20 billion, primarily for cleanroom facilities and supporting HBM and 1-gamma process capacity [5] - The company expects a continued supply shortage through 2026, as new production from its Idaho facility will not come online until mid-2027 [5] Analyst Ratings and Concerns - Goldman Sachs maintained a "neutral" rating, citing concerns over potential price declines in the HBM market in 2026 due to increased capacity from competitors like Samsung [6][7] - Morgan Stanley reaffirmed its "preferred stock" status for Micron, raising its target price to $35, emphasizing the stability of pricing under long-term contracts [8] - Barclays also raised its target price to $27.5, reflecting optimism based on structural changes in the storage industry [8]