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Micron Technology Q2 Tops Street, Outlook Strong; Shares Up 5%

Micron Technology Inc. (MU) Wednesday reported a profit for the second quarter that trumped Wall Street estimates, as did revenues. Shares of Micron gained over 5% on extended trading session after the technology company issued a strong revenue guidance above current estimates.

Boise, Idaho-based Micron's second-quarter profit dropped to $405 million or $0.36 per share from $1.62 billion or $1.42 per share last year.

On an adjusted basis, earnings dropped to $0.45 per share from $1.71 per share last year. On average, 26 analysts polled by Thomson Reuters estimate earnings of $0.37 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenues for the quarter dropped to $4.80 billion from $5.84 billion last year. Analysts had a consensus revenue estimate of $4.68 billion for the quarter.

Gross margin for the quarter dropped to 28.2 percent from 49.1 percent last year.

"Micron delivered solid second quarter results and revenue at the high end of the guidance range, despite the unfolding COVID-19 pandemic," said Micron Technology President and CEO Sanjay Mehrotra.

"I am grateful to our team for the excellent business execution we have achieved during this unprecedented situation. Their resilience, together with Micron's technology leadership, stronger product portfolio, and healthy balance sheet, give us confidence that we will emerge from this challenging time well-positioned to capture the robust long-term demand opportunities for memory and storage."

Moving ahead, Micron expects third-quarter revenues of $4.6 to $5.2 billion and adjusted earnings of $0.55 per share, plus or minus $0.15. Analysts currently estimate earnings of $0.53 per share and revenues of $4.87 billion.

MU closed Wednesday's trading at $42.50, down $0.77 or 1.78%, on the Nasdaq. The stock, however, gained $2.33 or 5.48% in the after-hours trade.

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