Micron shares drop more than 7% after missing on revenue


Matthew Staver | Bloomberg | Getty Images

The headquarters building of Micron Technology Inc. stands in Boise, Idaho, U.S.

Micron Technology shares dropped more than 6 percent during after hours trading Tuesday after the company missed revenue expectations in its quarterly earnings.

The company reported $7.91 billion, missing revenue estimates of $8.02 billion. However, it exceeded expectations in earnings, reporting $2.97 per share, beating analysts’ expectations of $2.96 per share.

On a conference call, Micron’s CEO Sanjay Sehorta said the revenue headwinds were due to “inventory adjustments.” The company also announced plans to reduce capital expenditures in fiscal 2019.

Micron said the impact of US tariffs were a half percent of its gross margin in the fiscal first quarter.

The Boise, Idaho-based company announced in September that President Trump’s tariffs on Chinese goods will hurt its profitability.

“Our gross margins will also be impacted in the near term by the announced 10 percent tariff on $200 billion of imports from China which will go into effect on September 24,” CFO David Zinsner said. “We are working to gradually mitigate most of the impact from these tariffs over the next three to four quarters.”

Both Deutsche Bank and BMO Capital Markets cut their price target for Micron by 25 percent in September.

Source link

Products You May Like

Articles You May Like

Wall Street analysts see an Amazon effect for some stocks
CBD is booming. But US farmers struggle to keep up with demand
Stocks tumble as economic worries grip investors—four experts react
Tencent Music’s first earnings report exposes soaring licence and production costs
Fundstrat’s Tom Lee sees upside in stocks as US still in mid-expansion

Leave a Reply

Your email address will not be published. Required fields are marked *