Micron MU is one of the world’s largest producers of memory chips, which were in high demand early in the COVID-19 pandemic. As sales of personal computers and other electronic devices have dried up in the past year, though, the company’s finances and stock have taken a hit.Micron MU is one of the world’s largest producers of memory chips, which were in high demand early in the COVID-19 pandemic.
Last quarter, Micron executives announced thousands of layoffs in conjunction with the company’s earnings report. Stock movement: Over Micron’s February-ended quarter, the stock slipped 0.3%, while the PHLX Semiconductor Index SOX rose 4.6% and the S&P 500 SPX declined 7.1% over the same period, compared with a 0.1% decrease for the tech-heavy Nasdaq COMP .
TD Cowen analyst Krish Sankar also foresees a write-down, though a smaller one than what Danely estimated. He predicts the company will write down $550 million to $850 million in inventory. Even so, TD Cowen’s Sankar said “a mix of architecture adjustments at hyperscalers as well as some inventory burn across server has added to the noise generated by Intel’s INTC Sapphire Rapids later than expected launch.”