Micron. HBM Gets Even Better, NAND Gets Even Worse

Is NAND flirting with yet another downturn?

Micron this week reported revenues of $8.1 billion, down 8% QoQ bu up 38% YoY, and at the top end of the guided range. Gross margin was 37.9%, marginally below the guided midpoint of 38.5%. Looking ahead, the company forecasted current quarter revenues of $8.8 billion at the midpoint, up 8.6% QoQ. However, Gross Margin is set to decline meaningfully to 36.5%. The cause for this decline was touched upon briefly in the prepared remarks:

We forecast sequentially lower fiscal Q3 gross margin, which includes the effects of higher consumer oriented volumes. NAND underutilization continues to weigh on gross margins.

While there were many HBM related positives to be taken from the earnings call, markets chose to focus instead on the gross margin decline, sending the stock down over 8% on Friday and paring the YTD gain back to 12.5%

So what’s going on with Micron’s HBM roadmap, and what the heck is happening with its NAND business? Let’s dig in…