December 20 Reuters -- Micron Technology Inc delivered stronger quarterly results than Wall Street expected, as data centers and electric vehicle manufacturers drove demand for its chips, and it forecast second-quarter sales and profits will beat estimates with chip shortages easing in 2022.
Micron has struck deals with its own suppliers to deal with bottlenecks in its supply chain.
The company makes both the NAND memory chips that serve the data storage market and the DRAM memory chips that are widely used in data centers, personal computers and other devices. Micron shares rose 5.7% to $87.70 in extended trading after the results.
Micron, one of the world's biggest memory chip suppliers, has been able to charge higher prices because of strong demand and industry-wide shortage of chips. Micron said that data center revenue grew 70% and automotive revenue grew 25%, with the growth coming from the increasing amount of memory required in cars with advanced driver safety systems.
In an interview, Sumit Sadana, Micron's chief business officer, told Reuters that we are seeing dramatic step ups in some of the new model cars.
Sadana said Micron officials expect non-memory chip shortages to start next year. The shortages have stifled shipments of both cars and personal computers.
We are starting to see an improvement on that front. He said that much of the improvement will occur through the calendar year 2022.
The company expects revenue in the current second quarter to be $7.5 billion, plus or minus $200 million, compared to analysts' average estimate of $7.27 billion, according to Refinitiv data. The company forecast adjusted earnings per share of $1.95, plus or minus 10 cents, beating analyst estimates of $1.86, according to Refinitiv data.
In the first quarter, Micron reported sales of $7.69 billion, above analyst expectations of $7.67 billion, according to Refinitiv data. Micron earned $2.16 per share on an adjusted basis, beating expectations of $2.11 per share.