Semiconductor Companies Post-Earnings Review

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Part 3
Semiconductor Companies Post-Earnings Review PART 3 OF 8

Why Micron Management Is Optimistic About Fiscal 2018

Micron chief outlined key priorities for fiscal 2018

Sanjay Mehrotra, CEO (chief executive officer) of Micron Technology (MU), sounded bullish about the company’s prospects in the current fiscal year (fiscal 2018). In addition to outlining five strategic priorities that revolve around cost controls and innovations, Mehrotra stated: “We expect the industry to remain moderately undersupplied for the rest of 2017 for both DRAM and NAND.”

Mehrotra also stated: “We see DRAM industry supply bit growth of about 20 percent in calendar 2017 and expect it to grow at relatively similar levels in calendar 2018…Our view [is] that NAND demand drivers will remain healthy into 2018.”

Why Micron Management Is Optimistic About Fiscal 2018

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Riding cryptocurrency mining boom

Micron’s memory products are used in cloud computing, automotive, cryptocurrency, and IoT (Internet of Things). According to Bloomberg, analysts cite Micron, Intel (INTC), Advanced Micro Devices (AMD), and Nvidia (NVDA) as potential big beneficiaries of the rise of cryptocurrency mining.

Riding cloud computing adoption

As cloud providers such as Amazon.com (AMZN), Microsoft (MSFT), and Alphabet’s (GOOGL) Google expand their capacities by opening more cloud regions, they are creating markets for Micron’s advanced memory products. Google, for instance, disclosed that it had opened two new cloud regions in 3Q17.

The growing demand for memory and storage products in the cloud, automotive, and cryptocurrency industries are part of the reason that Micron management is so optimistic about the company’s growth prospects in fiscal 2018 and beyond. Micron’s revenues grew 64% to $20.3 billion in fiscal 2017 (period ended in August).


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