The Futurum Group's Statement on Israel

Micron Delivers Strong Q1 Giving a Bullish Outlook For Semiconductors

The News: Micron Technology Inc. shares surged in the extended session Monday after the memory-chip maker forecast an outlook and reported earnings that topped Wall Street estimates as data-center sales proved to the company’s strongest growth sector.

Micron MU, +4.52% shares rallied 7% after hours, following a 1.2% decline in the regular session to close at $82.03.

The Boise, Idaho-based chip maker expects adjusted second-quarter net income of $1.85 to $2.05 a share on revenue of $7.3 billion to $7.7 billion. Analysts had forecast $1.84 a share on revenue of $7.29 billion.

Read the full news story on MarketWatch.

Analyst Take: 2021 has brought semiconductors to light in a way that no one would have expected. While I have been saying for years that Semiconductors would eat the world, even my predictions didn’t insinuate the chaos that this year’s shortages have brought to light.

The shortage has left tech executives, supply chain leaders, and global media to ponder questions about when there would be relief. With materials, substrates, assembly, and finished products all in short supply, even President Biden and his leadership were forced to develop a plan to prevent this type of supply chain shortage from happening again.

While any plans to rectify shortages short-term appear to be more long-term horizon (building fabs). All eyes have been placed squarely on our leading semiconductor makers, from Intel to Qualcomm to NVIDIA to Micron, to name a few, to determine what lies ahead. CEO’s have primarily been evasive in their answers about when the shortage would subside. Still, the answers tended to vary from a year from now (late 2022) to as far out as 2024 with the culprits to the shortage being the long runway to up production and the expected sustained demand that put us in this position in the first place.

Why such a long build-up to talk about Micron? Well, the Micron numbers were good, but the enthusiasm that saw Micron shoot up more than $12.00 a share after a somewhat tame low double-digit growth in 2021 was quite simple. The company didn’t only outperform expectations but painted a bullish picture about its future and the overall availability of chips in the near future–something the market has been longing to hear for most of 2021.

Without overstating the improvement of conditions, Micron’s CEO, Sanjay Mehrotra, came out with clear guidance that the shortage is easing, which would mean increased demand and revenue for its core DRAM and NAND memory products. Furthermore, Mehrotra shared that the company’s bets on Cloud and Datacenter are gaining steam with 70% YoY growth, indicating a solid recovery in enterprise IT spend.

As I see it, memory technologies such as those offered by Micron are a clear leading indicator of increasing demand for compute, networking, and other peripheral technologies like edge computing, IoT, connected vehicles, and much more. Micron being able to confidently exude strength to the market is another indicator of strength in the technology ecosystem and continued demand. While the earnings were good, the outlook was terrific, serving as a clear indicator that 2022 technology investments are on a sustained path, and the tech industry can expect another year of robust growth pending any wild shifts in macroeconomic conditions, which are, of course, always possible.

Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

Other Insights from Futurum Research:

All Eyes are on Semiconductor Companies Amid Chip Shortage — Investors Should be Looking at These Four Lesser-known Names

Micron to Invest $150B in Global Manufacturing and R&D

Amazon Announces Investments in Two Sustainable Companies as Part of The Climate Pledge Fund


Author Information

Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.

From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.

A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.

An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.


Latest Insights:

In this episode of Infrastructure Matters – Insider Edition, Krista Macomber and Randy Kerns are joined by Jim McGann, Index Engines’ Vice President of Strategic Partnerships, for a conversation focusing on the topic of the convergence of cyber security and storage.
New Cisco App Attention Index Indicates Elevated Digital Experience Expectations
Sherril Hanson, Senior Analyst at The Futurum Group, breaks down research results from Cisco focusing on digital and application experience and increased consumer expectations in this area.
An Assessment of Key Developments Across the 5G-IoT Ecosystem Including Netcracker Telco GenAI Debut, Amdocs NVIDIA Alliance, and SKT DT Telco-specific LLM
The Futurum Group’s Ron Westfall and Todd R Weiss review key telco GenAI developments such as Netcracker’s introduction of its GenAI Telco solution, the Amdocs NVIDIA GenAI partnership, and SKT DT jointly developing multilingual LLM aimed at global telcos.
Fourth Quarter Earnings for HP Indicate Continuing Sequential Growth in the Rebounding PC Market
Olivier Blanchard, Research Director at The Futurum Group, shares his insights on the HP Q4 2023 earnings, which suggest a rebound for PCs in 2024 despite persistent market headwinds.