When companies beat revenue and earnings expectations as much a Micron Technologies did in its most recent quarter, the market often heaps on praise for stellar results. Not this time, though. We’ll get into why as well as Uber Technologies’ deal with Rivian Automotive and Alibaba’s $100 billion in AI revenue target Tyler Crowe, Matt Frankel, and Jon Quast discuss: - Micron Technologies earnings - Is it different this time for memory companies? - Uber &amp; Rivian teaming up for autonomous vehicles - Alibaba’s AI targets and investing in international AI plays. Companies discussed: MU, NVDA, AMD, ASML, UBER, RIVN, LCID, TSLA, GOOG, AMZN, MSFT, BABA, LYFT, STLA, GM Host: Tyler Crowe Guests: Matt Frankel, Jon Quast Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode. Learn more about your ad choices. Visit ⁠⁠⁠⁠⁠⁠⁠⁠megaphone.fm/adchoices⁠⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Micron Revenue Smashes Expectations, but Wall Street Yawns

Motley Fool Hidden Gems Investing

# Full Transcript

**Podcast:** Motley Fool Money

## Participants

- **Tyler Crowe** (The Motley Fool)
- **Matt Frankel** (The Motley Fool)
- **Jon Quast** (Motley Fool)

## Transcript

[SPEAKER_03] Wall Street has big expectations for memory chips now. This is Motley Fool Money. Welcome to Motley Fool Money. I'm Tyler Crowe, and today I'm joined by longtime full contributors Matt Frankel and Jon Quast. Got quite a few subjects we're going to talk about. We're going

[SPEAKER_03] to jump into taking the pulse of the autonomous vehicle landscape with a recent deal between Uber and Rivian. We're going to take a look at Alibaba's earnings and some ambitious AI targets they're putting forward. But first, we're going to jump into Micron's most recent earnings and some really big numbers that didn't seem to impress Wall Street that much. The company announced earnings after the close yesterday. Matt, the numbers for the earnings

[SPEAKER_03] announcement itself, it's hard for me to come up with a word to capture how much the company beat earnings expectations. Put some numbers behind what we were seeing this most recent quarter.

[SPEAKER_01] Yeah. In simple terms, companies like Micron can't produce memory fast enough to keep up with demand of this AI infrastructure development. Micron's CEO said that the company was only able to produce 50% to two-thirds of what its biggest customers wanted during the quarter. AI chips need a lot of memory, plain and simple. In the quarter, Micron's revenue nearly tripled year over year. And you're right that the term blowout quarter doesn't even do that justice. The company's revenue was

[SPEAKER_01] almost $24 billion and beat expectations by nearly $4 billion. Earnings beat expectations by a similarly wide margin. Gross margin doubled to about 74% year over year. A gross margin doubling for a company this mature is pretty unheard of. The pricing power that it's getting due to the supply, demand, and balance is certainly a wonderful thing. The guidance was an even stronger beat. Analysts were

[SPEAKER_01] looking for $24.3 billion in the current quarter, the one we're in now. And the company guided for $33.5 billion. That's like almost a 50% margin. This might not be too much of a shock. And it doesn't look like it's that much of a shock to a lot of investors based on the stock price action, if you've been following some of the CapEx projections of the big tech players. But it's really tough to overstate how strong the AI infrastructure investment surge is making Micron's business.

[SPEAKER_03] You hinted at it a little bit here. John, I want to get to you. Even though the company reported earnings that were indeed impressive, the stock's down about 2.8% as we tape. And some of that may be broader market vibes. There's concerns about whether the Fed's going to increase interest rates in the near-term future. There's the conflict in the Middle East driving up oil prices. So there's vibes a little

[SPEAKER_03] ...

Micron Revenue Smashes Expectations, but Wall Street Yawns

Transcript

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Every day you wait, your competitors are finding
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Micron Revenue Smashes Expectations, but Wall Street Yawns

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.