Micron forecasts upbeat first-quarter revenue on strong demand for memory chips By Reuters

(Reuters) – Micron Technology reported first-quarter revenue above Wall Street estimates on Wednesday, betting on strong demand for its high-bandwidth memory (HBM) chips used by the AI ​​industry, sending the company’s shares up 10 percent after the bell .

The company is one of only three HBM chip suppliers along with South Korea’s SK Hynix and Samsung ( KS: ), which has allowed the U.S. company to cash in on demand for semiconductors that help power AI technology.

The AI ​​boom also helped Micron (NASDAQ: ) cushion the blow from memory chip overstocks in the PC and smartphone markets.

The company estimated revenue of $8.70 billion, plus or minus $200 million, for the first quarter, compared with estimates of $8.28 billion, according to LSEG data.

Micron’s results typically set the tone for the chip sector, as it reports ahead of peers and serves a broad customer base that spans the PC, data center and smartphone industries.

The company said in June that its HBM chips were sold for calendar years 2024 and 2025. The chips are used in AI processors designed by Wall Street darling Nvidia (NASDAQ: ).

Micron expects adjusted gross margin for the first quarter to be 39.5%, plus or minus 1%. Analysts were expecting an adjusted gross margin of 37.7%.

For the fourth quarter, the company’s revenue rose 93% to $7.75 billion.