Micron Sees $50B Q4 Revenue, $31 EPS Guidance, 84.9% Margin
MU•Micron forecast fiscal Q4 revenue of $50 billion versus $43 billion expected, EPS guidance of $31 against $25 estimates and adjusted gross margin of 84.9% versus 81.8% forecasts. No end to memory market supply constraints signals sustained pricing power, driving optimism that lifted SK Hynix shares 15% on planned $29.65 billion U.S. ADR listing.
1. Q4 Guidance Beats Estimates
Micron set fiscal fourth-quarter revenue guidance at $50 billion, surpassing the $43 billion consensus, and issued EPS guidance of $31 per share versus $25 expected. Adjusted gross margin guidance of 84.9% topped forecasted 81.8%, marking a significant beat on all key metrics.
2. Memory Market Supply Tightness
Management reported no clear end to supply constraints in the global memory market, highlighting durable pricing power. This persistent imbalance between supply and demand underpins strong margin forecasts and enhances the company's ability to negotiate favorable contract terms with key customers.
3. Industry Impact and SK Hynix Listing
Micron's robust outlook catalyzed a broader rally in memory chip stocks, including a 15% surge in SK Hynix shares. SK Hynix plans to issue 17.79 million ADRs on Nasdaq to raise 45.45 trillion won (approximately $29.65 billion), with trading expected to begin on July 10, expanding its U.S. investor base.
4. Investor Sentiment and Valuation Implications
The earnings guidance reinforced optimism about sustained growth in AI memory demand, prompting a re-rating of Micron's valuation. Despite earnings growing at hundreds of percent, the stock trades at a 10X forward multiple versus the S&P 500's 20X, suggesting further upside if profitability remains strong.
