Micron Beats Estimates as AI Data Center Revenue Surges | Closing Bell

And right now we are two minutes away from the end of the trading day. Romaine Bostick here with Emily Gravelle. We're taking you through to that closing bell. It's a global simulcast. We're joined now by David Gura and Christina Ruffini in today for Carol Massar intense dynamic. Who knows where they are? Welcome to our audiences across all of our Bloomberg platforms television, radio, our partnership with YouTube here on the final trading day of a sloppy September that I think a lot of people would like to forget. Yeah, and we're seeing the last day traders actually taking some risk off the S&P 500 moving negative just as we hit that closing bell. What is David Gura doing. You know you have to stay in the shot. David I'm so sorry I unplugged my cable. Ramon I missed your this isn't our studio, guys. I hope everyone was making fun of this guy. He spent his whole career working in, you know, media. I know, sorry, I figured out how it's. I don't have Tim's finesse. I'm back. Don't worry about me. Please give him a more of a hard time. This is. This is. I'm really glad you never, never does. I'm here. All right, well, you know, guys, we're going to get micron earnings in just a few minutes here. And obviously this is kind of a once again another test here for the appetite for the eye trade. Yes, a huge. We've been talking about this over the course of the afternoon here. We've been, you know, there's this anxiety centering around the prospects of where I is going here. We've seen that remain kind of filter into this broader conversation about the way that's affecting the build out that's taking place here as well. Uh, the anxiety that we've seen in terms of a number of these data center companies pulling back on their IPOs, uh, it's definitely spreading, it seems, the sense of anxiety. And we've seen the president recent days trying to quell that a little bit as well. Let's walk through some of the numbers as we wait for the closing bells. And we wait for those earnings out of micron, the end of the day, the end of the month and end of the quarter. The S&P back in the red on the day down about 2/10 of a percent. As we wait for these numbers to settle, that means it will close lower for the month by about 4/10 of a percent. The Dow Jones Industrial Average losing about 400 points on the day, down about 8/10 of a percent. Uh, and it's going to be lower on the month by about 4%. The Nasdaq indices each in the green on the day, just up about 2/10 of a percent. Both indices in the green on the month as well. The Russell 2000 closing out the day down 11 points or 4/10 of a percent and down 5.4%. For the month of September. Can't emphasize enough here how much better this is when I can hear you loud and clear. Remain obviously, something that investors are paying very close attention today to was the amount of economic data that we got really a torrent of economic data about consumer spending. Uh, we got the core PC numbers, of course, which are so important to Federal Reserve policymakers. We saw investors in real time, kind of recalibrating their sense of what the fed is going to do at that next meeting at the end of October. Uh, it seems like, what 40% of them now expect the fed is not likely to hike at that next meeting. Yeah. And you see that reflected in kind of what sectors were doing. Well today we do have information technology leading the way. Uh, when you look at, you know, the sector breakdown of the S&P 500, that green section is all IT consumer discretionary following up as well on that consumer spending data. Consumer staples lagging the most micron earnings crossing the wire right now. Let's get right to it. Expectations were high. And on the surface it does appear that they met those expectations. Adjusted revenue in the fiscal fourth quarter 5.4. Excuse me $54.23 billion. The street was looking for roughly about $52 billion, we should point out, on a year over year basis, that's growth of about 370%. Gross margin in the quarter expanded to 87%, up from 86.2. And here's your bottom line number. Adjusted EPs for the quarter $33.42 a share. The street was looking for 3183. The guidance for the current quarter that were in the fiscal first quarter. The company says expect adjusted EPs of $37.15 to $39.15. The low end of that range is above the average of analysts estimates for 36.02. And finally, guys, the revenue figure for the current quarter, the company guiding the 60 to $63 billion in revenue, the street estimate was for 57 billion. The knee jerk reaction, though, is basically the shares. We'll call it unchanged. There you go, Robin. I'm going to stick with those revenues for this Boise based behemoth here and kind of look under the hood a little bit here. And you really see beats across the board when you look at cloud memory. That beat $16.28 billion. The estimate $15 billion automotive and embedded revenues 6.82. As well, look, we're talking about this, of course, in the context of AI in that build up. But this is very much a a company that is so, so widely involved in so many aspects of the broader tech space. I think I've been looking at, um, SanDisk, uh, which was as much, uh, up as much as 14% is down about half percent today. But when you look at SanDisk and micron overall, they've outpaced Nvidia this year. And part of that I think you're seeing not only from the numbers that David was just mentioning, but when you look at a regulatory infrastructure, obviously those are not you're not seeing those, uh, fears evaluate through the market because you had this big press conference at the white House this week. You had all the AI leaders talking about it, unclear if that was going to hit, uh, you know, all these, uh, earnings numbers, but obviously it's too early. But, um, it's it's good news for them so far. And they've really been outpacing, uh, some competitors so far. And we're getting a little bit more details about these earnings. One number sticking out to me fourth quarter core data center revenue a big beat here $18 billion versus estimates of just 11.3. Of course we know the data center trade is alive and well, and we're seeing that in these results. Another one fourth quarter adjusted operating income also beating estimates remains. Yeah. We should point out that when you look at sort of the unchanged nature of the shares, remember they had rallied about 40% off of those lows from the summer and still up something like close to 300% on a year to date basis. And a big part of the reason, guys, is, to a certain extent, the numbers from last quarter, the numbers for the current quarter are probably a little bit less important than what the company says on the conference call about the long term picture, looking in the 2027 calendar year, 2028 and even beyond. Remember when we heard from SanDisk? We heard from Nvidia, we heard from some of the other chipmakers. It was really about that multi-year forecast. And whether that runway for this for AI spending would actually continue. Looking for fourth quarter cash flow from operations, $43.97 billion. And we were talking just a few moments ago with the CFO of HP, just talking about sort of how emblematic this is, a company that has been around now for many years, kind of transitioning into a very AI focused, AI network focused company. Uh, again, we're seeing this transition taking place really across the spectrum, guys.