Micron weakness hits Dell, HP and semiconductors as demand for consumer electronics declines

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Micron technology (NASDAQ: MU) issued a weak guidance for its fourth fiscal quarter, which negatively impacted PC makers such as Dell Technologies (NYSE: DELL) and HP Inc. (NYSE: HPQ), as well as other semiconductor companies on lingering concerns about declining demand for consumer electronics.

Dell Stocks (DELL) fell more than 7% to $42.83while HP (HPQ) lost nearly 3.5% to $31.36 on a heavier than normal volume.

Research firm Gartner recently forecast PC shipments to decline 9.5% in 2022, citing a “perfect storm” of events including geopolitical upheaval, inflation, volatile currencies and blockchain disruptions. supply.

On Thursday, Micron (MU) warned that fourth-quarter revenue would be well below Wall Street estimates as it expects sales to be between $6.8 billion and $7.6 billion, with adjusted earnings per share between $1.43 and $1.83 per share. Analysts had expected Micron (MU) to generate $9.05 billion in revenue and adjusted earnings of $2.62 per share.

Micron (MU) chief executive Sanjay Mehrotra said industry demand had weakened “recently”, citing weakness in PCs and smartphones. He said the company would take steps to moderate supply growth in fiscal 2023.

Micron’s (MU) outlook hit the shares of several semiconductor companies, including Nvidia (NASDAQ: NVDA), Advanced Micro Devices (AMD), Intel (INTC), Qualcomm (QCOM) and Marvell Technologies (MRVL), which fell nearly 4% in mid-day trading.

Chipset makers such as Lam Research (LRCX), Applied Materials (AMAT), and KLA Corp. (KLAC) all fell nearly 7% after Bank of America analyst Vivek Arya warned that Micron’s decision to cut tool spending would impact the trio.

Arya then downgraded shares of Micron (MU), citing the impact of weak PC and smartphone sales, lockdowns in China and slowing corporate sales.

Last month, Bernstein analyst Toni Sacconaghi said recent activity suggests that Michael Dell could take Dell Technologies (DELL) private again, but he added that it would take a particular series of events to happen. .

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