Why Nvidia’s Memory Price Warning Is Good News for Micron (MU) Stock
TLDR
- Nvidia CFO Colette Kress confirmed memory prices have exceeded prior expectations and are heading even higher into next year
- Nvidia has made $279 billion in supplier commitments, more than double the $119 billion from the previous quarter
- DRAM prices could climb over 50% this quarter, with NAND flash potentially jumping 60%, per Susquehanna research
- Wall Street’s average Micron price target sits near $1,525, with KeyBanc holding the highest target at $1,750
- Micron posted record Q3 sales of $41.46 billion and guided for approximately $50 billion next quarter
Micron Technology (MU) closed Wednesday at $938.40 and jumped another 3.09% in overnight trading Thursday to around $967.35, after Nvidia’s earnings call put memory pricing firmly back in the spotlight.
Nvidia CFO Colette Kress said during the company’s earnings call that memory price increases had “exceeded prior expectations” and were headed even higher into next year. Nvidia reported revenue of $96.2 billion for the quarter, doubling year-over-year, though gross margins came under pressure from rising memory costs.
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