Micron Shares Fall 6% Despite Strong Results on Higher Capex Plans

Core Viewpoint - Micron Technology reported strong fiscal second-quarter results with significant revenue and earnings growth, but shares fell due to higher-than-expected capital spending plans [1] Financial Performance - Adjusted earnings per share for the quarter ended February 26 were $12.20, up from $1.56 a year earlier and above the analyst consensus of $8.79 [1] - Revenue surged 196% year over year to $23.86 billion, exceeding estimates of $19.19 billion, compared to $8.05 billion a year earlier [2] - Gross margin reached a record 74.9%, increasing 18 percentage points sequentially [2] - DRAM revenue, which accounted for 79% of total sales, totaled $18.77 billion, representing a 207% increase year over year [2] - NAND revenue climbed 169% to $5.0 billion, supported by pricing gains in the high-70% range [3] Future Guidance - For the current quarter ending in May, Micron forecasts revenue of $33.5 billion, significantly above the analyst estimate of $24.29 billion [3] - Adjusted EPS guidance of $19.15 is nearly double the consensus estimate of $12.03, with gross margin expected to rise to 81%, up 610 basis points sequentially [3] Capital Expenditure Plans - The company plans to invest more than $25 billion in new manufacturing facilities in fiscal 2026, approximately $5 billion higher than previous projections [4] - Capital expenditures are expected to increase by more than $10 billion year over year in fiscal 2027 as the company expands global manufacturing capacity [4] - Construction spending is expected to outpace equipment spending in both fiscal 2026 and 2027 [4]