OraFinanza – Still deep red for STMicroelectronics (EPA:)at the bottom of the second only to Telecom Italia (BIT:), in the wake of Micron Tech’s collapse on Wall Street.
If the US memory manufacturer drops 15% at the opening of the session on the US stock exchange, the shares of the Italian-French company lose 5%, falling to a minimum of 23.605 euros, thus returning to their lowest levels since the end of November.
Micron Techamong the main companies in the DRAM memory market used in computers, servers, smartphones and hard disks, has supplied disappointing indications on the performance of the business traditional, communicating that its new activities related to Artificial Intelligence are doing well but not enough to overshadow the slowdown in sales of consumer electronics devices.
The company warned that “consumers are not upgrading their personal computers as quickly as expected”, while, “automotive sales have fallen short of expectations due to lower production and a shift towards lower-priced models, which has caused automakers to reduce inventories.”
The US company has created a adjusted earnings per share of $1.79 in the first quarter of the fiscal year, higher than the $1.76 expected by analysts surveyed by FactSet. The current quarter is expected to end with sales of approximately 7.9 billion, 1 billion below the consensus estimate.
“Although consumer-oriented markets are weaker in the near term, we expect a return to growth in the second half of our fiscal year,” the CEO said Sanjay Mehrotrawho adds: “We continue to gain share in the highest margin and strategically important market segments and are exceptionally well positioned to leverage AI-driven growth to create substantial value for all stakeholders.”
During the investor call, Mehrotra said he expects HBM’s overall market to exceed $30 billion in 2025, up from his forecast of more than $25 billion in September. Micron also expects to generate “multiple billions” in high-bandwidth memory (HBM) revenue in fiscal 2025.
“Although there are company-specific elements, we view the news as negative for semiconductor companies exposed to the consumer market,” comment analysts at Banca Akros.
In particular, analysts’ attention is focused on STM: “Although it has residual exposure to the memory market, Micron’s messages offer a negative transverse reading as they concern end market trends rather than specific dynamics within the memory market,” they explain WebSim Intermonte which maintain a ‘neutral’ rating on STM, with a target price of 26 euros.
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