Was having your head in the clouds the right place to be all along?
Micron saw stronger-than-expected third quarter earnings results when it reported after the bell Monday, largely driven from major orders from cloud giants and a more favorable pricing environment.
Non-GAAP earnings per share of 82 cents and revenue of $5.44 billion exceeded FactSet estimates of 75 cents and $5.27 billion, respectively.
Micron continues to see strong demand from internet/cloud giants as a capex upswing that began in 2018 saw a boost from coronavirus-related traffic spikes as many stayed at home amid the economic lockdown. The company saw strong results in Cloud DRAM sales as well as Cloud SSD sales.
“We are ramping the industry’s most advanced DRAM technology into production and have delivered more than 75% of our NAND volume as high-value solutions, supported by record SSD revenue in the quarter. Our portfolio momentum positions us exceedingly well to leverage the long-term growth across our end markets,” Micron Technology President and CEO Sanjay Mehrotra said in the earnings release.
Going forward, Micron expects 5G phones and the next round of gaming consoles to serve as further tailwinds. “Micron sees both content increases and seasonal phone launches boosting its mobile sales during the back half of the year, while also suggesting that pent-up demand from consumers who were unable to visit retail stores during lockdowns could provide a lift,” TheStreet’s Eric Jhonsa wrote.
How is Jim Cramer approaching the stock? Cramer is keeping his eye on 5G as well. Watch more in the video above.
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