Micron's June 24 Earnings: The AI Memory Trade Decider
Key Questions
What were Micron's Q3 earnings results?
Micron reported Q3 revenue of $41.46B and EPS of $25.11, significantly beating expectations, with Q4 guidance at $50B revenue and 86% margins. The stock surged 14.9% after-hours and 16-17% in the next session.
What caused the pre-earnings sell-off in Micron stock?
The stock fell 13.2% pre-earnings due to Korean contagion concerns and HBM slowdown rumors, but these concerns reversed following the strong results.
What are the take-or-pay SCAs and their impact?
Micron has 16 take-or-pay supply customer agreements totaling $100B with pricing floors, which are expected to break the traditional boom-bust semiconductor cycle by providing structural stability.
What did Micron's CEO highlight as the next demand driver?
CEO Mehrotra pointed to humanoid robots as the next major demand driver beyond current AI memory needs, reinforcing the supercycle and scarcity thesis.
How does Samsung's DRAM price hike confirm industry trends?
Samsung's push for a 20% DRAM price increase in Q3 supports the structural shortage narrative, aligning with Gavin Baker's memory crunch thesis and Micron's pricing power.
Micron reported a massive beat: Q3 revenue $41.46B, EPS $25.11, Q4 guidance $50B with 86% margins. Stock surged 14.9% after-hours, then +16-17% in the following session. CEO highlighted humanoid robots as next demand driver. Pre-earnings sell-off (-13.2%) on Korean contagion/HBM slowdown rumors has reversed. Options show call wall at $1,200. Earnings confirm the supercycle and scarcity thesis. Key structural development: 16 take-or-pay SCAs with pricing floors totaling $100B in contracts, potentially breaking the boom-bust cycle. CEO Mehrotra blamed big customers for past price cuts causing the shortage, reinforcing the structural tightness narrative. Samsung is pushing a 20% DRAM price hike in Q3, confirming structural shortage. Gavin Baker's 'memory crunch' thesis adds credibility from a top tech fund manager. Stock recently approached $1,000 again after a 22% dip from its high. A new article argues Micron breaks the classic semiconductor cycle view, reinforcing the structural break thesis.