Micron Down 30% on SK Hynix Sell-Off — $100B Contracts
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- SK Hynix posted Q2 sales up 257% to $54.5 billion and operating profit up 557% to $41.7 billion, yet shares plunged because results fell short of 'near-impossible expectations,' dragging Micron Technology down roughly 30% over the past month.
- Micron's fiscal third quarter (ended May 28) delivered record revenue of $41.5 billion — up 345% year-over-year and ahead of the $35.8 billion analyst estimate — with EPS rising more than 1,200% to $25.11 and gross margin expanding to 83% from 58% a year earlier.
- Micron holds 16 strategic customer agreements (SCAs) running through 2030, with 14 of them carrying cumulative minimum revenue of about $100 billion — a figure management said will 'well exceed' baseline calculations.
- Micron trades at a trailing P/E ratio below 17 versus the tech sector average of 39, making the pullback a potential entry point according to the analysis.
- Apple raised prices across nearly all of its devices citing high memory costs, cited in the article as evidence that memory pricing pressure will persist.
- Micron CEO Sanjay Mehrotra said tight memory conditions are expected to persist beyond calendar 2027, while SK Hynix management separately expects shortages through 2030.
Why it matters: Micron's 30% pullback was triggered by a peer's results rather than any deterioration in its own business — Micron posted 345% revenue growth, 1,200% EPS growth, and holds $100 billion in locked-in contracts running through 2030. With the stock now trading at a trailing P/E under 17 versus the tech sector average of 39, patient investors willing to look past sentiment-driven selling get a discounted entry into a leading AI memory supplier.
