Micron Encounters Earnings Challenge Following Share Price Increase Since April

June 25, 2025

Investors Eye Micron Technology Amid AI Boom

Investors searching for opportunities in artificial intelligence infrastructure are increasingly turning to traditional but often overlooked companies like Micron Technology Inc.

The memory chip manufacturer is set to announce its revenue figures after the market closes on Wednesday. It’s noteworthy that Micron has been one of the stronger performers in recent times, with its stock nearly doubling since the S&P 500 hit a low in April. As spending on AI computing gear surges, investors are curious about other potential beneficiaries beyond well-known names like Nvidia Corp.

Micron’s growth is particularly significant for AI computing. The dynamic random access memory chips they produce are closely tied to Nvidia’s processors, which are crucial for AI operations. The ongoing supply constraints due to the complexities of manufacturing these chips have likely helped to drive up prices.

While Micron may not have the flashy reputation of Nvidia, its high-bandwidth memory chips are considered top-tier for AI applications, and the demand for them continues to grow unabated. Notably, at 1:30 PM in New York, Micron’s stock was approximately 0.5% lower.

Analysts expect the Boise, Idaho-based company to report adjusted earnings of $1.60 per share, targeting revenues around $8.9 billion, based on an average of analyst estimates compiled by Bloomberg. This would represent increases of 158% in earnings and 30% in revenue compared to the same period last year.

“Micron’s pricing and availability of high-bandwidth memory will be key factors,” said Jake Behan, head of capital markets at Direxion. “Investors want to know how well positioned Micron is to meet production demands and supply constraints, especially given the rising customer need for hyperscale and AI capabilities.”

After missing Wall Street expectations in the second quarter, profitability has become a significant focus for investors. Newstreet Research analysts predict an improvement in both DRAM and NAND margins, which could enable Micron to surpass expectations.

According to average analyst estimates, the adjusted total margin is forecasted to be 36.8%, down slightly from 37.9% in the previous quarter.

Of course, any strong earnings report could lead to a sell-off, particularly given how much the stock has gained. Since April 8, when President Trump announced a delay in tariffs, Micron shares have soared nearly 95%.

In the options market, expectations indicate an 8% volatility in the stock following the earnings report.

Some investors, like Tigay of the Rational Equity Armor Fund, remain optimistic about Micron but also express concerns that sustaining the recent rally might be challenging in the near term. “It wouldn’t be surprising to see some revenue consolidation before the rally picks up again later this year,” Tigay remarked.

Meanwhile, shares of Worldline SA dropped significantly on Wednesday, plummeting over a third after reports surfaced about the company allegedly concealing fraudulent activities by its customers. The French payments firm’s stock fell sharply following the release of a series of articles from the European Journalism Network EIC, alleging that Worldline continued business with banned and high-risk customers while overlooking fraudulent transactions.