Micron delivers a record-breaking earnings report: revenue of about $54.2 billion, adjusted earnings per share of $33.42, and next-quarter guidance of $61.5 billion—each above market expectations.
From after-hours to the open, the stock price fell by less than 1%. According to public discussion, the options market had originally priced in volatility of ±8%. Earnings won, but the price didn’t.
What really weighed on it was that same night’s surge in the U.S. 10-year Treasury yield to 5.33%, the highest since 2002. With such a high risk-free return, there’s no reason for capital to pay an extra premium for high growth.
The company also didn’t spell everything out: rising compensation costs will eat into part of the profit; this quarter’s gross margin is 87%, and next-quarter guidance is about 86.25%.
Bulls are focused on HBM demand, reportedly extending orders through 2028, and customers’ $12.3 billion in prepayments to lock in capacity. Bears are focused on inventory digestion and NAND price weakness. Market chatter puts the target price range from 1,200 to 2,200—disagreement is even bigger than the earnings figures.
So here’s the question: if this storage upcycle can truly last two years, why can’t this earnings report earn a gap-up open?
From after-hours to the open, the stock price fell by less than 1%. According to public discussion, the options market had originally priced in volatility of ±8%. Earnings won, but the price didn’t.
What really weighed on it was that same night’s surge in the U.S. 10-year Treasury yield to 5.33%, the highest since 2002. With such a high risk-free return, there’s no reason for capital to pay an extra premium for high growth.
The company also didn’t spell everything out: rising compensation costs will eat into part of the profit; this quarter’s gross margin is 87%, and next-quarter guidance is about 86.25%.
Bulls are focused on HBM demand, reportedly extending orders through 2028, and customers’ $12.3 billion in prepayments to lock in capacity. Bears are focused on inventory digestion and NAND price weakness. Market chatter puts the target price range from 1,200 to 2,200—disagreement is even bigger than the earnings figures.
So here’s the question: if this storage upcycle can truly last two years, why can’t this earnings report earn a gap-up open?