Micron Turns Profitable, Clear Recovery Phase in Memory Chips This Year

Sales Surge 57% 'Surprise Earnings'
US Accelerates Semiconductor Subsidy Payments

U.S. company Micron Technology announced earnings that surpassed market expectations. SK Hynix reported a return to profitability in the fourth quarter of last year, and with Micron revealing a turnaround to profit this year, an upward trend has been confirmed. Sales also exceeded forecasts, leading to assessments that the semiconductor industry has entered a full-fledged recovery phase.

On the 20th (local time), Micron announced its fiscal 2024 second-quarter results (December 2023 to February 2024), reporting sales of $5.82 billion (approximately 7.8 trillion KRW). This represents a 57% surge from $3.693 billion (about 4.95 trillion KRW) in the same period last year, surpassing the expert forecast of $5.35 billion (7.17 trillion KRW) compiled by investment information firm LSEG. Net income for the period was $793 million (1.063 trillion KRW), turning profitable from a net loss of $2.3 billion (3.083 trillion KRW) a year earlier. Adjusted earnings per share were 42 cents, higher than the LSEG forecast of 25 cents.

Micron's strong performance was largely driven by a surge in demand for artificial intelligence (AI) chips. Sanjay Mehrotra, CEO of Micron, stated, "Micron will be one of the biggest beneficiaries in the semiconductor industry through the multi-year opportunities enabled by AI." Micron has announced that it supplies advanced memory High Bandwidth Memory (HBM) 3E, which is spotlighted in the AI semiconductor era, to Nvidia.

With Micron exceeding expectations, Samsung Electronics and SK Hynix are also expected to see significant increases in their first-quarter earnings this year. Professor Lim Hyun-sik of Dongguk University's Department of Physics and Semiconductor Science said, "It seems that a boom in semiconductor chips with definite demand due to AI development has begun," adding, "Samsung Electronics and SK Hynix are also highly likely to see substantial improvements in their earnings." An industry insider commented, "This is seen as a result of stabilized semiconductor demand," and added, "As Micron, ranked third, has increased its sales, Samsung Electronics and SK Hynix are also expected to see sales growth."

The U.S. is accelerating subsidy payments in line with the semiconductor recovery. The U.S. government announced on the same day that it will provide Intel, a domestic semiconductor company, with $19.5 billion (about 26 trillion KRW), the largest amount under the Semiconductor Act. This amount includes $8.5 billion (about 11.4 trillion KRW) in subsidies and $11 billion (about 14.8 trillion KRW) in loan support, making it the largest support under the semiconductor support law. Samsung Electronics and Taiwan's TSMC are also expected to officially announce their subsidy amounts later this month. U.S. President Joe Biden emphasized, "I am pleased to announce the largest semiconductor investment in U.S. history," adding, "This will transform the semiconductor industry and create a completely new ecosystem."

Meanwhile, the positive news from the U.S. is having a favorable impact on the stock prices of domestic semiconductor companies. As of 11 a.m. on the same day, Samsung Electronics was trading at 78,500 KRW, up 1,600 KRW (2.08%) from the previous day, and SK Hynix was trading at 168,100 KRW, up 11,600 KRW (7.41%).

This content was produced with the assistance of AI translation services.