Micron Q2 FY8/25 Earnings Review

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Numbers Good, Stock Meh So Far

by Alex King, CEO, Cestrian Capital Research, Inc.

Micron printed its Q2 of FY8/25 after the close today. A solid quarter on fundamentals in my view. Revenue growth slowed to +38% vs the same quarter last year, with the guide for next quarter a further slowdown to 29% vs the prior year quarter. Cashflow margins moved up to +7% on a TTM basis, vs. a cycle low of -40% in the middle of 2023. Last time around cashflow margins peaked at around 18% (in the February 2022 quarter) so it may be there is still some margin upside available. The stock is pricey on cashflow, inexpensive on revenue and EBITDA in my view. The initial stock reaction was very positive; that has faded somewhat at the time of writing. $MU is now sitting right on top of its 200-day moving average. What happens next is important not just for MU but also for the semiconductor sector and therefore for the market indices.

Here’s the headlines:

Now the heart of the matter: