Apple Needs Chips, and “Micron Sets the Price.” Now Micron Is Making More Money than Apple
Micron reported $37.7B net income for Q4, surpassing Apple's $29.8B in its June quarter. Apple's gross margin guidance fell to 46.5% from 48.1%, partly due to memory costs. Micron's stock trades at 5.9x forward earnings, with analysts expecting EPS to more than double by fiscal 2027. Micron's CEO noted high demand from customers.
How this was made
The 30-second read
Why it matters
Micron's earnings beat and guidance could drive a rally, while Apple's margin guidance may dampen its stock.
Market read
Micron's strong results and forward guidance present a buying opportunity, whereas Apple’s margin compression introduces risk.
What to watch
Potential inventory build‑up at Apple could mitigate margin impact if demand softens.
Background
The article compares Micron's earnings surge to Apple's earnings, emphasizing the memory shortage's impact on both companies.
Ticker impact
Micron reported $37.7 billion net income for its fiscal Q4, a 42‑fold surge and guidance that revenue will rise to $61.5 billion in Q1 FY27, indicating strong pricing power.
likely upward pressure as investors price in higher margins and revenue growth
The unprecedented profit jump and forward‑looking revenue guidance signal a material shift in Micron's earnings trajectory.
Apple disclosed a September‑quarter gross‑margin guidance of ~46.5%, down from 48.1%, citing higher memory costs from Micron.
potential downside as higher component costs compress earnings
The margin guidance reflects increased input costs, which could reduce near‑term profitability.
Market effects
Strengthens the semiconductor memory sector outlook while pressuring downstream device makers.
U.S. tech stocks may see mixed moves as Micron rallies and Apple faces margin pressure.
Highlights global supply‑chain constraints on memory chips affecting worldwide device manufacturers.
Counterpoint
Micron's pricing power may be temporary if supply catches up, leading to a correction.
Key entities
- companyMicron Technology
Semiconductor memory manufacturer reporting record earnings.
- companyApple Inc.
Consumer electronics giant facing higher memory costs.
