Are looking at shares of Micron eking out again after soaring past Wall Street estimates, with a monster sales forecast and insatiable demand for high bandwidth memory chips in AI data centers, pushing expectations higher for the U.S. memory giant and quite the staggering run up to Syracuse for revenue of $54.2 billion.
And now Micron projects next quarter sales could hit $63 billion. But as HBM memory shortages drive up costs for consumer electronics, how long can this pricing power last? Well, joining us live this morning to weigh in is Mike on Microns earnings. Is Matthew Tuttle CEO at Tuttle Capital Management.
Matthew good morning. Thank you so much for joining us. There are so many moving parts as we kick off the final quarter of 2026. But I do want to get your take on Micron, especially given their latest report. So do you think this HBM memory squeeze is structural or are we nearing peak pricing power.
Yeah. And everyone expected Micron to have a blowout. And they did. But the real key thing for us was they expect the whole supply demand equation to even get tighter. And 27 and 28. So no, I don't think we've reached peak pricing power. That to us is the real bullish statement in all of this. So we have two memory ETFs HBM Microns our top holding.
Nothing is going to change there for me. Uh DRM it's one of our top holdings. Again nothing going to change. We loved what we saw out of Micron stocks. Now trading down a bit. I think that's just because you know everyone knew it was going to be a blowout. They were probably on the lower end of the whisper numbers.
But I do think a lot of the strength we're seeing in the rest of the AI trade this morning is because they didn't lay an egg.
Yeah. And Matthew you mentioned the word equation. Micron is committing 10 billion to expand R&D in Boise and also AI production capacity. But when it comes to this equation of overbuilding potentially CapEx, what do you expect to see if big tech data centers spending does cool down?
Yeah, I mean that is something you've definitely got to keep an eye on. Any hint that the hyperscalers are going to slow down on spending is going to hit the whole AI complex. We're not seeing it. Uh, you know, you had obviously Dario and some other people come out a couple of weeks ago maybe, you know, put a little fear into the marketplace.
But at the end of the day, you know, we're we're in a race on AI with China. It doesn't look like AI spending is decreasing anytime soon. But that's something that we're laser focused on and investors should be laser focused on in case that does happen because yeah that's definitely going to hit a stock like Micron.
Yeah. And Matthew. Today is October 1st. And it is hard to believe that we are counting down to the midterms but also year end. And consumers out there have a lot to contend with, especially when it comes to higher prices paying out the pump as well as the grocery store. So what about consumer electronics as we head into the holiday shopping season?
The AI memory drain is driving up costs for things such as laptops as well as phones, and that is leading to price hikes by some companies out there, including Apple. So will consumer hardware margin pressure eventually weigh on broader chip demand?
I think it could. You know, certainly we don't want anything to do with the consumer unless it's alcohol and tobacco. Uh, you know, we think those are two areas that consumers are never going to cut spending on anything else. We're worried about the strength of, you know, kind of the average to lower end consumer.
But we certainly still see spending from, you know, the institutional marketplace. The area that we're getting real laser focused on is actually some of these software names that were left for dead a while back that really take the AI model and make it work in your organization. So, you know, if I had to pick like one area that we're really getting excited about into year end, that it's that, you know, the CRMs, the nows and the the Mongo.
Yeah. And that does remind me of that new term that was added to our lexicon earlier this year, and that was SaaS apocalypse. But when it comes to what we're seeing in those names as well as semi stocks, how are traders as well as momentum flows positioning following Microns earnings pop.
Yeah. And like I said, I think a lot of this strength and it's always hard to tell.
First day of the month, you know, you're always going to have some strange moves anyway. But it does look like a lot of this strength as people were sitting on their hands waiting to see what Micron said. Micron didn't scare anybody. You know, the the big thing is the supply demand equation is getting worse.
So I think that gives people an all clear. You know, plus yesterday's numbers, especially the PCE. You know maybe the Fed's not going to raise as much as we thought they were. So you know again kind of an all clear to get back into the AI trade at least for now.
Yeah. And indeed we are in the midst of spooky season, but at least not for Micron. And just for perspective, Micron has been rallying about 238% year to date and 537% over the past 12 months. So not too shabby here. So after this guidance, we do you buy the breakout or take profits on some of those overheated memory names.
And I do want to get your perspective on what we're seeing with Treasury yields and how that affects the overall market outlook moving forward.
Yeah. So I think.
If you own Micron, which we do, there's no change here. Um, if you don't own Micron and the memory names. Yeah. I mean I think this signal gives you an all clear that you can go into memory, watch your position sizing. You know, memory is going to give you a wild ride. You know, we tell people one, two, 3% of your portfolio and memory names, that's enough.
You know, don't do a whole heck of a lot more than that. Treasury yields. We are laser focused on one of the things that that concerned me a bit yesterday about the PCE numbers is theoretically, you know, lower inflation, lower chance of the Fed hiking rates should come down. They didn't you know, the bond vigilantes, the bond traders are in control of the longer end of the curve and they are still signaling.
Hey, we've got no faith. We don't think the Fed is going to be able to keep inflation under control. That's something you've got to watch because the Fed can do what they're going to do. If bond traders take the ten year off, take the 30 year up. That's going to leave a mark and it's going to impact, you know all these high flying tech stocks.
We know what that looks like. You know we saw 2022. And you know we know how ugly that environment was where stocks and bonds went down at the same time. We think bonds are investable at this point. You want property and casualty stocks in place of bonds. And you know some other things you can do. Uh, but yeah, we are laser focused on on yields right now.
Yeah. And finally, before I let you go, Matthew, we are less than 24 hours away from that jobs report. And of course the focus is on inflation, not just for the central bank but also Americans on Main Street. But what are your expectations and what will you be watching from that report tomorrow morning?
I'll be watching.
To see whether the report is enough, whether it's a big upside, big downside to move the needle for the Fed. You know, we know that Warsh was brought in by Trump to lower rates. Are we going to see anything that gives him ammunition. And you know we know they're not lowering rates this year. But are we going to see anything that gives him ammunition to hold rates steady and possibly lower rates next year.
Or are we going to see something that says, oh, man, you know, they're going to have to raise rates and they're going to raise them more. So that's kind of what we're looking at.
Well, Matt, always great talking to you. Thank you so much for joining us this morning. And as always, thank you so much for your perspective.
Thanks for having me.
