Micron Technology sees mountainous increase for semiconductors in 5G and electrical autos as world economies recover from the pandemic, CEO Sanjay Mehrotra told CNBC on Thursday.
“The markets this day are extra diversified than ever. Car, electrical autos requiring extra memory and storage — in actuality changing into records companies on wheels within the waste — and positively smartphones, records companies, gaming, industrial applications” are all contributing to elevated want for chips, Mehrotra talked about on “TechCheck.” “We in actuality search a extra healthy and extra sturdy ask ambiance than ever.”
Micron — which makes memory chips old for records storage, smartphones and a differ of alternative computing devices — reported better-than-anticipated quarterly sales and profit on Wednesday. Its fourth-quarter revenue guidance furthermore topped analyst projections.
The chipmaker forecast fourth-quarter revenue of $8.2 billion, plus or minus $200 million, whereas analysts on common were observing for $7.87 billion, in step with IBES records from Refinitiv.
In its fiscal third quarter, Micron’s revenue jumped 36% to $7.42 billion, when Wall Avenue had been taking a look for $7.24 billion, in step with Refinitiv. Per-portion earnings of $1.88, excluding items, beat forecasts of $1.72.
The pandemic has resulted in a “digital transformation acceleration,” Mehrotra talked about, and a pronounced scarcity of semiconductors that’s rippled across the world economy. On Wednesday, as an illustration, Ford Motor launched one other spherical of production delays stemming from the chip crunch.
On the opposite hand, bigger prices due to the provision squeezes and the Covid-know-how shift to a long way-off work agree with helped Micron.
Going ahead, Mehrotra expects extra tailwinds for the firm sparked by technological shifts in areas similar to wi-fi networks. He talked about 5G know-how, particularly in smartphones, synthetic intelligence, vivid edge and shimmering particular person devices, had been key sources for ask increase since they all require extra records memory and storage.
Despite the optimistic outlook, Mehrotra talked about the firm is being “extremely prudent” in its methodology to fabrication vegetation and ability. “We want to grow our provide in accordance with the long-time interval ask developments,” the CEO talked about.
However within the intervening time, he talked about, Micron inventories are “running very lean,” with the firm observing for industry shortages lasting thru the dwell of this year and into 2022. “The shortages, as they obtain alleviated, will continue to initiate up pent-up ask, as successfully,” he talked about.
Shares of Micron closed down 5.7% on Thursday to $80.11 apiece. The inventory is up extra than 6% year to this point.
— Reuters contributed to this represent.