To The Moon

After the bell on March 20, $Micron Technology(MU)$ will report Q2 FY2025 earnings.Due to price hike expectations in, since the beginning of the year outperformed $Invesco QQQ(QQQ)$ $NVIDIA(NVDA)$ , in the early March wave of the selloff is also quite tenacious performance.

Earnings date-weighted implied stock price volatility of ±11.3% is relatively volatile.

Expectations for current-quarter results are not too widely divergent at this point, with $Citigroup(C)$ even expecting EPS may improve somewhat: (Citi vs. Consensus)

• Revenue: $7.9 billion vs $7.9 billion

• Gross Margin: 37.5% vs 37.5%

• Adjusted EPS: $1.29 vs $1.26

But the focus is on next quarter's earnings guidance. Will it fall short of market expectations?(Citi vs. Consensus)

• Revenue: $8.2 billion vs. $8.6 billion

• Gross margin: 35.0% vs. 38.7

• Adjusted EPS: $1.28 vs $1.36

Mainly due to: deterioration in consumer product mix, low NAND utilization.

Estimates

1. Supply and demand: also the NVIDIA conference on March 18th could prompt HBM, storage upgrade's.For DRAM, the CAPEX-constrained trend will continue, and for HBM, demand will continue to outpace supply.

   Current HBM market size: $40 billion in FY2025, growing to $58 billion in FY2026.And Micron's HBM revenue expectations (market share): $7.6 billion (19%) in FY2025 and $13 billion (22%) in FY2026.

2. Competitive situation intensified: South Korean manufacturers SK Hynix and $ Samsung (SMSN.UK)$ in HBM technology on the rapid advancement of Micron pressure: SK Hynix has mass production of 12-layer HBM3E, and plans to launch HBM4 in 2025; Samsung plans to 2024 the end of the large number of supplies of HBM3E to NVIDIA, andaims to increase the proportion of HBM3E sales to 60% in the fourth quarter.

3. Price Increase Expectations.Micron, Samsung, and SK Hynix are all set to increase their offers from April, with Micron rumored to raise NAND prices by 11%

   In addition, recent D5 spot prices are up 8% year-to-date, the largest increase since the first quarter of fiscal 2024.Considering the supply-demand balance, the outlook is still sufficient to maintain expectations for a DRAM recovery, despite likely weaker-than-expected Q3 guidance.Below are the growth expectations for different business segments for FY2025:

• 2025(F) DRAM ASP QoQ(%): 1Q25 -7% → 2Q25 +2% → 3Q25 +7% → 4Q25 +13

• 2025(F) Server QoQ(%): 1Q25 -8% → 2Q25 +3% → 3Q25 +11% → 4Q25 +16

• 2025(F) Mobile QoQ(%): 1Q25 -10% → 2Q25 -3% → 3Q25 +2% → 4Q25 +11

• 2025(F) PC QoQ(%): 1Q25 -15% → 2Q25 -5% → 3Q25 Flat → 4Q25 +10

• 2025(F) Graphic/Consumer QoQ(%): 1Q25 +5% → 2Q25 +10% → 3Q25 +9% → 4Q25 +9