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Bloomberg
Micron Technology Inc, the largest US maker of computer memory chips, gave a forecast that fell short of analysts’ estimates, adding to concern that a two-year surge in demand for its products is over. The shares declined as much as 9 percent in extended trading.
Revenue in the current period will be $5.7 billion to $6.3 billion, the Boise, Idaho-based company said on a conference call. That compares with an average analyst prediction of $7.32 billion. The middle of that range would represent a sales decline of 18 percent, the first year-over-year decrease since 2016. Micron projected profit of $1.75 a share, plus or minus 10 cents, which is also well short of estimates.
Profit, excluding certain items, was $2.97 a share in the fiscal first quarter. Revenue jumped 16 percent to $7.91 billion in the period ended November 29. Analysts had projected profit of $2.95 a share on sales of $8.01 billion, according to data compiled by Bloomberg. Micron’s capital spending budget for fiscal 2019 will be cut to $9 billion to $9.5 billion, the company said.
At the midpoint, that’s a reduction of $1.25 billion from the previous plan. Micron makes chips used as the main memory in computers and as storage in mobile devices. Increasing demand from data-center operators and in more diverse uses such as cars, has helped drive demand.