Chipmaking stocks bleed after Micron Technology, Inc. MU cautious forecast for Q4.
Piper Sandler saw DRAM and NAND prices decline, impacting Micron as mobile and laptop end markets face continued weakness based on inSpectrum’s June monthly memory contract pricing data .
Piper Sandler also discussed how semiconductor equipment inventories can become constrained in a decelerating or declining memory CAPEX environment.
He pointed out Lam Research Corp. LRCX with a higher relative exposure to memory CAPEX, followed by Applied Materials, Inc. AMAT, UCK Corp KLACand ASML Holding SA ASML.
Piper Sandler had downgraded Micron, citing its dependence on DRAM, the fight against price cuts for most configurations and significant exposure to consumer markets such as PCs and mobiles, which are hammered during an economic downturn. .
Mizuho also shared a similar opinion.
Earlier this month, Advanced Micro Devices, Inc. AMD warned of a slowdown in the PC market after two strong years amid the pandemic.
Gartner also outlined how China’s economic slowdown and inflation-driven decline in consumer spending will likely weigh on global computer and smartphone shipments in 2022. All of this will affect companies ranging from Nvidia Corp. NVDA at Apple Inc. AAPL and Microsoft Corp. MSFTis expected to announce its quarterly results starting in July.
Pre-market price actions: MU traded down 4.45% to $52.82, ASML down 3.93% to $457.20, TSM down 3.6% to $78.81, United Microelectronics Corp. CMU shares down 3.1% to $6.56, Western Digital Corporation WDC down 3.64% to $43.20, Nvidia -1.65% to $149.30, Qualcomm Corporation COMQ -1.71% to $125.55 and AMD -1.75% to $75.13.
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