By Samrhitha A and Stephen Nellis
(Reuters) -Micron Technology forecast first-quarter revenue above Wall Street estimates on Wednesday, powered by demand for its memory chips from the rapidly growing artificial intelligence sector.
But the Idaho-based chipmaker forecast a wider than expected first-quarter loss as it prepares to ramp up production of new product lines. Shares were down 0.4% in after-hours trading after the results.
The company's shipments have benefited from strong demand for AI servers and processor suppliers promoting large language models that enable generative AI.
Demand for high-bandwidth memory chips, a market which is led by SK Hynix, for use in AI has also raised investor hopes that Micron will be able to weather a slow recovery in other end markets. Micron said Wednesday that it expects to start production of lucrative high-bandwidth memory, which is used in many AI chips, next year.
Micron faces a ban on the use of some of its products among certain Chinese customers after China's government said its products had failed a security review.
"While there is near-term impact to our demand due to these challenges in China, we remain focused on maintaining Micron's global market share," Micron Chief Executive Sanjay Mehrotra said in a statement.
Micron expects adjusted revenue of $4.40 billion, plus or minus $200 million, for the current quarter, compared with estimates of $4.20 billion, according to LSEG data.
The company forecast an adjusted loss per share of $1.07, steeper than the analyst estimates of a 95 cents per share loss.
Revenue for the fourth quarter stood at $4.01 billion, compared with estimates of $3.91 billion.
(Reporting by Samrhitha Arunasalam in Bengaluru; Editing by Shounak Dasgupta and Josie Kao)
