Svmuu News: Micron released its earnings report this morning. Key information is summarized below:
I. Financial Performance (Reported Quarter)
Quarterly revenue was $41.46 billion (some sources reported $41.5 billion), exceeding market expectations of approximately $35.8 billion.
Adjusted EPS was $25.11, exceeding market expectations of approximately $20.7-$20.8.
Gross margin was 84.9%, exceeding market expectations of 81.9%.
II. Next Quarter Guidance (Q4)
Revenue guidance is $49.0 billion to $51.0 billion, with a midpoint of $50.0 billion, exceeding market expectations of $43.24 billion.
Adjusted EPS guidance is $30 to $32, with a midpoint of $31, exceeding market expectations of $25.31.
III. Long-Term Agreements (LTA/SCA) and Customer Commitments
16 long-term strategic customer agreements have been signed, primarily covering the period from 2026 to the end of 2030. The agreements include take-or-pay clauses. Management expects these agreements to correspond to approximately $100 billion in guaranteed revenue. Approximately $22 billion in cash deposits and financial commitments will be received. The signed agreements cover approximately 20% of DRAM production and about one-third of NAND production for the corresponding period. Management expects approximately half or more of future revenue to be covered by long-term agreements.
IV. Supply, Demand, and Industry Outlook
The company expects tight supply and demand for DRAM and NAND to continue beyond 2027. DRAM industry shipments are projected to grow by 20%-25% in 2026, an upward revision from previous expectations. NAND industry shipments are projected to grow by approximately 20% in 2026, consistent with previous expectations.
Micron's DRAM supply growth is expected to be broadly in line with the industry. Micron's NAND supply growth is expected to be slightly below the industry average.
V. Capital Expenditure and Capital Returns
Market feedback indicates that the company's capital expenditure is in line with expectations. No aggressive expansion plans were evident. The company stated that capital returns will significantly increase in Q4. The $22 billion in customer prepayments is approximately equivalent to one-third of capital expenditures over the next two years.