Micron Technology’s shares rose around 14% in extended trading after the company forecasted its first-quarter revenues for fiscal year 2025 (Q1 FY25) at $8.7bn. The higher-than-expected revenue is expected to be driven by the growing demand for its memory chips used in artificial intelligence (AI) computing.
The American computer memory and computer data storage producer reported a significant surge in its net income for the fourth quarter of fiscal year 2024 (Q4 FY24), reaching $887m compared to a loss of $1.43bn in the corresponding quarter of the previous fiscal year.
In the previous quarter, that is Q3 FY24, Micron Technology’s net income was $332m. The company’s net income for the reported full fiscal year was $778m compared to the $5.8bn loss reported in the last fiscal year.
Revenue for the chip company’s reported quarter that ended 29 August 2024 also saw a significant boost, climbing 93% to $7.75bn from Q4 FY23’s revenue of $4bn. For the full fiscal year, the revenue stood at $25.1bn, a growth of around 62% compared to $15.54bn in FY23.
Micron benefits from surging DRAM demand
This growth has been mainly attributed to the record-high revenues in the company’s NAND and storage business unit. The company also achieved high revenues in data centre and automotive divisions.
Micron Technology’s DRAM revenue for Q4 FY24 was $5.3bn, an increase of 93% year over year (YoY). This represented 69% of total revenue. The firm’s NAND revenue for the reported quarter was $2.4bn billion, an increase of 96% YoY. This made up 31% of Micron Technology’s total revenue.
According to the company, its data centre server DRAM achieved a quarterly revenue record in Q4 FY24 which was driven by strong demand for high-capacity solutions and the continue ramp of high bandwidth memory (HBM).
Micron Technology’s robust financial performance is primarily attributed to a higher pricing environment and an enhanced product mix. “Micron delivered 93% year-over-year revenue growth in fiscal Q4, as robust AI demand drove a strong ramp of our data centre DRAM products and our industry-leading high bandwidth memory,” exulted the firm’s president and CEO, Sanjay Mehrotra. “Our NAND revenue record was led by data centre SSD sales, which exceeded $1bn in quarterly revenue for the first time.
“We are entering fiscal 2025 with the best competitive positioning in Micron’s history. We forecast record revenue in fiscal Q1 and a substantial revenue record with significantly improved profitability in fiscal 2025.”
The US chip company plans to make investments to support AI-powered demand. It also expects that Q1 FY25 gross margin will increase sequentially predominantly on better pricing and portfolio mix.
In another development in the chip sector, South Korean dynamic random-access memory chips and flash memory chips supplier SK Hynix said that it started mass production of its 12-layer HBM3E product with 36GB1.
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