Micron Technology Inc. , the largest US maker of computer memory chips, has provided a strong revenue forecast for the current quarter, driven by demand for artificial intelligence hardware. The company expects fiscal third-quarter revenue to be between $6. 4 billion and $6. 8 billion, surpassing the average analyst estimate of $5. 99 billion. Micron's positive outlook is attributed to the growing market for AI gear, which is helping chipmakers like Micron return to growth and profitability. Micron's shares rose 18% in premarket trading on Thursday, and if the gains hold, it will be the company's biggest jump in over 12 years. CEO Sanjay Mehrotra believes Micron is well-positioned to benefit from the multiyear opportunity enabled by AI. The company is focusing on producing enough ultrafast memory, particularly high-bandwidth memory (HBM), to support the development of AI software. Micron expects to generate several hundred million dollars of revenue from HBM products in fiscal 2024 and has already achieved its first revenue from HBM3E.

The company's production of HBM chips is sold out for 2025. Micron's revenue in the second quarter increased by 58% to $5. 82 billion, beating estimates. The company's profitability and positive operating margin have returned ahead of expectations. Micron competes with Samsung Electronics and SK Hynix in the memory-chip market and is looking to expand into new markets to reduce dependence on smartphones and PCs. The US Department of Commerce has announced it will award Intel $8. 5 billion in grants and up to $11 billion in loans for the expansion of its semiconductor factories, the largest disbursement so far from the Biden administration's Chips and Science Act. Micron maintains its budget for new plants and equipment for fiscal 2024 and plans to proceed with projects in China, Japan, and India, while US expansions are contingent on receiving sufficient incentives.