Micron Technology (MU) Q3 Earnings Report Preview: What To Look For

Jabin Bastian /
2022/06/29 10:02 am EDT
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Memory chips maker Micron (NYSE:MU) will be announcing earnings results tomorrow after market hours. Here's what to look for.

Last quarter Micron Technology reported revenues of $7.78 billion, up 24.8% year on year, beating analyst revenue expectations by 3.22%. It was a very strong quarter for the company, with a significant improvement in gross margin and a beat on the bottom line.

Is Micron Technology buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Micron Technology's revenue to grow 16.6% year on year to $8.65 billion, slowing down from the 36.4% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $2.45 per share.

Micron Technology Total Revenue

The analysts covering the company have been growing increasingly bearish about the business heading into the earnings, with revenue estimates seeing four downward revisions over the last thirty days. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 1.72%.

Looking at Micron Technology's peers in the semiconductors segment, only Broadcom has so far reported results, delivering top-line growth of 22.5% year on year, and beating analyst estimates by 2.46%. Read our full analysis of Broadcom's earnings results here.

Triggered by the Federal Reserve's hawkish stance on interest rates, shares of technology companies have been facing sell-off in 2022 and semiconductors stocks have not been spared, with share price down on average 16.8% over the last month. Micron Technology is down 23.4% during the same time, and is heading into the earnings with analyst price target of $95.6, compared to share price of $56.41.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.