Micron: HBM Sold Out for 2024, Most of 2025 Reserved

Micron's CEO, Sanjay Mehrotra, has announced the complete depletion of high-bandwidth memory (HBM) chips earmarked for the development of sophisticated artificial intelligence (AI) applications for the year 2024, with a significant portion of the 2025 supply already committed.

Notably, NVIDIA has chosen to integrate Micron's cutting-edge HBM3E chips into its forthcoming H200 graphics processing units (GPUs), marking a strategic shift from sole reliance on SK Hynix as the exclusive supplier of HBM chips.

Micron's Chief Business Officer, Sumit Sadana, has confirmed securing contracts for the company's HBM products with new clients, though specific details remain undisclosed.

Mehrotra underscored the surging demand for AI servers as a key driver fueling the rapid expansion of HBM, DDR5, and data center SSD markets. Concurrently, tight supply conditions prevail for high-end DRAM and NAND, exerting a positive influence on pricing dynamics within the storage ecosystem. It is anticipated that inventory days for DRAM and NAND will diminish throughout 2024.

Micron anticipates a favorable contribution from HBM to its DRAM business and overall gross margins, commencing from the third quarter of the 2024 fiscal year. Revenue projections for HBM sales in the current fiscal year are estimated to exceed hundreds of millions of dollars.

Recent financial disclosures from Micron reveal second-quarter revenues totaling $58.2 billion, surpassing earlier projections of $53.5 billion. Furthermore, the company expects a third-quarter adjusted gross margin of 26.5%, with a fluctuation margin of 1.5%, compared to market expectations of 20.8%. Data sourced from LSEG indicates Micron's forecasted third-quarter revenue at $6.6 billion, with a fluctuation range of $200 million, significantly exceeding market expectations of $6.03 billion.