Micron says it received all licenses required for it to continue business with Huawei Technologies

One of the leading names in U.S manufacturers of computer accessories, Micron Technology, announced on Wednesday that recovery is likely in the upcoming year. The manufacturer faced a cyclical bottom in Q2. In its announcement on Wednesday, the company further added that it has been successful in getting all licenses required for it to continue business with Huawei Technologies. Huawei is one of the largest customers of Micron.

Micron Performed Fairly Upbeat In The Stock Market In 2019 Despite The Ongoing Trade War

Micron also released its quarterly earnings report on Wednesday. While the performance results weren’t largely optimistic, the stock was seen trading 4% higher in extended trading on Wednesday. Micron has performed largely upbeat in the stock market in 2019 so far. Having started the year at $32.57 per share in January, it is currently exchanging hands at $55.06 that marks the highest for Micron in 2019.

Micron cited upbeat demand for its memory chips in the fiscal first quarter of 2020. The company was previously weighed following Trump’s order that forbade American companies to do business with a list of Chinese firms including Huawei.

The recently acquired licenses that enable Micron to work with Huawei, however, are likely to take a couple of quarters before the impact can be witnessed in the quarterly performance, as per the Chief Business Officer, Sumit Sadana of Micron Technology. Since China is one of the biggest markets for U.S manufacturers, the ongoing trade war has weighed on Chipmakers’ performance in the past 17 months.

Noticeable Figures In Micron’s Fiscal First Quarter Earnings Report

Micron recorded 48 cents of earnings per share (adjusted) in the first quarter that was highlighted as a cent above the analysts’ forecast. In the quarter that ended on 28^th November, Micron’s net income dropped significantly to $491 million. In the same quarter last year, net income for the U.S chipmaker was noted at $3.29 billion. Based on Refinitiv’s data, analysts had expected the company to print $5.01 billion in revenue in the first quarter. The earnings report highlighted the manufacturer to have beaten the analysts’ forecast and noting $5.14 billion in revenue in the fiscal first quarter of 2020. The figure, however, remained well below the $7.91 billion mark that was announced in the same quarter last year.

Micron’s operating cash flow also dropped from $2.23 billion in the previous quarter to $2.01 billion in 2020’s first quarter. In the same quarter last year, the company had revealed a remarkably higher $4.81 billion in operating cash flow.