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Micron (MU) Down 11.3% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Micron (MU - Free Report) . Shares have lost about 11.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Micron due for a breakout? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Micron Technology, Inc. before we dive into how investors and analysts have reacted as of late.
Micron Q3 Earnings and Revenues Beat Estimates
Micron reported third-quarter fiscal 2025 earnings of $1.91 per share, beating the Zacks Consensus Estimate by 20.13%. MU’s third-quarter earnings jumped 208.1% year over year from the year-ago quarter’s earnings of 62 cents.
Micron’s revenues increased 37% year over year to $9.30 billion and beat the Zacks Consensus Estimate by 5.3%. The top line was driven by robust demand for its high bandwidth memory (HBM) products.
Micron Q3 Top-Line Details
Technology-wise, DRAM revenues of $7.1 billion, accounting for 76% of the total revenues in the fiscal third quarter, increased 51% year over year and 15% sequentially. The company experienced record demand for data center DRAM, driven by strong growth in HBM and robust performance of high-capacity DIMMs and low-power server DRAM products.
NAND revenues of $2.2 billion, representing 23% of the total revenues, were up 4% year over year and 16% quarter over quarter.
Other revenues were $75 million in the reported quarter, which increased from $54 million in the year-ago quarter and remained flat sequentially.
Business segment-wise, revenues of $5.1 billion from the Compute and Networking Business Unit soared 96.2% from the year-ago quarter and 11% sequentially, driven by a more than 50% sequential increase in HBM revenues.
Revenues of $1.6 billion from the Mobile Business Unit remained flat on a year-over-year basis and increased 45% on a quarter-over-quarter basis due to reduced customer inventories and strong demand from DRAM content growth.
The Embedded Business Unit’s revenues were $1.2 billion, down 7.7% from the year-ago period but up 20% from the previous quarter. Revenues from the Storage Business Unit, comprising solid-state drive NAND components, totaled $1.5 billion, which increased 7.1% year over year and 4% sequentially.
Micron’s Q3 Operating Details
For the fiscal third quarter, MU posted a non-GAAP gross profit of $3.62 billion, representing a robust improvement from the year-ago quarter’s $1.92 billion. Also, Micron’s non-GAAP gross profit increased 18.7% sequentially.
The fiscal third-quarter non-GAAP gross margin of 39% improved from the year-ago quarter’s 28.1.%. The non-GAAP gross margin increased 110 basis points from the previous quarter’s 37.9%.
Non-GAAP operating expenses were $1.133 billion compared with the previous quarter’s $1.046 billion and the year-ago quarter’s $976 million.
Micron’s non-GAAP operating income of $2.49 billion was higher than the previous quarter’s non-GAAP operating income of $2.01 billion. It also shows significant improvements from the year-ago quarter’s non-GAAP operating income of $941 million.
The non-GAAP operating margin came in at 26.8%. Micron posted a non-GAAP operating margin of 24.9% for the previous quarter, and it had a non-GAAP operating margin of 13.8% in the year-ago quarter.
Micron’s Balance Sheet & Cash Flow
MU exited the reported quarter with cash and investments of $10.81 billion compared with $8.22 billion at the end of the prior quarter. It ended the quarter with total liquidity of $15.7 billion, up from the previous quarter’s $12.1 billion.
Micron’s total debt, as of May 29, 2025, was $15.5 billion compared with the $14.4 billion witnessed at the end of the previous quarter.
The company generated an operating cash flow of $4.61 billion in the fiscal third quarter. It spent $2.7 billion on capital expenditure in the quarter, resulting in an adjusted free cash flow of $1.95 billion. MU paid out $392 million in dividends but repurchased no shares in the third quarter of fiscal 2025.
Micron’s Q4 Outlook
Micron provided its guidance for the fourth quarter of fiscal 2025. The company anticipates revenues of $10.7 billion (+/-$300 million) in the fiscal fourth quarter. For the fiscal fourth quarter, MU projects a non-GAAP gross margin of 42% (+/-100 basis points). Operating expenses on a non-GAAP basis are estimated to be $1.2 billion (+/-$20 million). Adjusted EPS is anticipated to be $2.50 (+/- 15 cents).
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in fresh estimates.
The consensus estimate has shifted 24.13% due to these changes.
VGM Scores
Currently, Micron has a great Growth Score of A, a grade with the same score on the momentum front. However, the stock has a score of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Micron has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Micron (MU) Down 11.3% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Micron (MU - Free Report) . Shares have lost about 11.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Micron due for a breakout? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Micron Technology, Inc. before we dive into how investors and analysts have reacted as of late.
Micron Q3 Earnings and Revenues Beat Estimates
Micron reported third-quarter fiscal 2025 earnings of $1.91 per share, beating the Zacks Consensus Estimate by 20.13%. MU’s third-quarter earnings jumped 208.1% year over year from the year-ago quarter’s earnings of 62 cents.
Micron’s revenues increased 37% year over year to $9.30 billion and beat the Zacks Consensus Estimate by 5.3%. The top line was driven by robust demand for its high bandwidth memory (HBM) products.
Micron Q3 Top-Line Details
Technology-wise, DRAM revenues of $7.1 billion, accounting for 76% of the total revenues in the fiscal third quarter, increased 51% year over year and 15% sequentially. The company experienced record demand for data center DRAM, driven by strong growth in HBM and robust performance of high-capacity DIMMs and low-power server DRAM products.
NAND revenues of $2.2 billion, representing 23% of the total revenues, were up 4% year over year and 16% quarter over quarter.
Other revenues were $75 million in the reported quarter, which increased from $54 million in the year-ago quarter and remained flat sequentially.
Business segment-wise, revenues of $5.1 billion from the Compute and Networking Business Unit soared 96.2% from the year-ago quarter and 11% sequentially, driven by a more than 50% sequential increase in HBM revenues.
Revenues of $1.6 billion from the Mobile Business Unit remained flat on a year-over-year basis and increased 45% on a quarter-over-quarter basis due to reduced customer inventories and strong demand from DRAM content growth.
The Embedded Business Unit’s revenues were $1.2 billion, down 7.7% from the year-ago period but up 20% from the previous quarter. Revenues from the Storage Business Unit, comprising solid-state drive NAND components, totaled $1.5 billion, which increased 7.1% year over year and 4% sequentially.
Micron’s Q3 Operating Details
For the fiscal third quarter, MU posted a non-GAAP gross profit of $3.62 billion, representing a robust improvement from the year-ago quarter’s $1.92 billion. Also, Micron’s non-GAAP gross profit increased 18.7% sequentially.
The fiscal third-quarter non-GAAP gross margin of 39% improved from the year-ago quarter’s 28.1.%. The non-GAAP gross margin increased 110 basis points from the previous quarter’s 37.9%.
Non-GAAP operating expenses were $1.133 billion compared with the previous quarter’s $1.046 billion and the year-ago quarter’s $976 million.
Micron’s non-GAAP operating income of $2.49 billion was higher than the previous quarter’s non-GAAP operating income of $2.01 billion. It also shows significant improvements from the year-ago quarter’s non-GAAP operating income of $941 million.
The non-GAAP operating margin came in at 26.8%. Micron posted a non-GAAP operating margin of 24.9% for the previous quarter, and it had a non-GAAP operating margin of 13.8% in the year-ago quarter.
Micron’s Balance Sheet & Cash Flow
MU exited the reported quarter with cash and investments of $10.81 billion compared with $8.22 billion at the end of the prior quarter. It ended the quarter with total liquidity of $15.7 billion, up from the previous quarter’s $12.1 billion.
Micron’s total debt, as of May 29, 2025, was $15.5 billion compared with the $14.4 billion witnessed at the end of the previous quarter.
The company generated an operating cash flow of $4.61 billion in the fiscal third quarter. It spent $2.7 billion on capital expenditure in the quarter, resulting in an adjusted free cash flow of $1.95 billion. MU paid out $392 million in dividends but repurchased no shares in the third quarter of fiscal 2025.
Micron’s Q4 Outlook
Micron provided its guidance for the fourth quarter of fiscal 2025. The company anticipates revenues of $10.7 billion (+/-$300 million) in the fiscal fourth quarter. For the fiscal fourth quarter, MU projects a non-GAAP gross margin of 42% (+/-100 basis points). Operating expenses on a non-GAAP basis are estimated to be $1.2 billion (+/-$20 million). Adjusted EPS is anticipated to be $2.50 (+/- 15 cents).
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in fresh estimates.
The consensus estimate has shifted 24.13% due to these changes.
VGM Scores
Currently, Micron has a great Growth Score of A, a grade with the same score on the momentum front. However, the stock has a score of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Micron has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.