Semiconductor maker Micron Technology shared its first-quarter earnings report, which beat Wall Street estimates. However, the company’s stock plunged on Thursday due to weak second-quarter guidance.
Micron reported $1.79 in adjusted earnings per share compared to $1.75 expected by analysts. Its revenue of $8.71 billion for Q1 came in line with the estimates.
For Q2, Micron projects revenue of $7.9 billion, plus or minus $200 million. Even with the more optimistic forecast, this will still be significantly lower than the $8.99 billion expected by analysts. The company also predicts between $1.43 and $1.53 in adjusted EPS versus analysts’ estimates of $1.91.
Micron’s weaker-than-expected guidance results from depressed demand for personal computers and smartphones, which make up a large part of the company’s semiconductor output.
“While consumer-oriented markets are weaker in the near term, we anticipate a return to growth in the second half of our fiscal year,” CEO Sanjay Mehrotra said in a statement.
On the other hand, Micron is optimistic about the demand for its artificial intelligence-related products.
“We continue to gain share in the highest margin and strategically important parts of the market and are exceptionally well positioned to leverage AI-driven growth to create substantial value for all stakeholders,” Mehrotra added.
Micron’s stock dropped by 16% at one point in pre-market trading on Thursday before gaining back some losses. It was previously 26.18% up year-to-date.