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Thursday, December 21, 2006

Quick Comment on Micron (NYSE:MU)

Micron (NYSE:MU) is out with the numbers. Quick look at the numbers shows mixed bag of positives and negatives, but at least for me, positives are outweighting the negatives.

Positives:
1) EPS way above expectations on strong gross margins - don't think that anybody expected margins as high as 31%.
2) NAND doing well, 15% revs coming from NAND according to the co - up from <10% in the previous quarters. Lexar sure helped, but the worst fears didn't come true for sure. And co is even telling that NAND margins improved!!
3) CMOS margins maintained - that is sure good thing in light of what OVTI was telling us.

Negatives:
1) Revenue. Looks like the co was concentrating on margins on the expense of revenue.
2) Inventories increased another ~$150m. That is a cause for concern.

As said, more positives than negatives. Expecting the stock to go higher tomorrow than the current $14.15 in the afterhours.

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