Let's dig deeper to find out.Source: Company annual reports. It came from Micron Technology's 10-K report repeated below. Analysts expect its revenue and earnings to decline 12% and 61%, respectively, this year, before rebounding strongly in fiscal 2021. Robert Castellano, the analyst proprietor of the Information Network, has asserted that Micron has overtaken DRAM competitors Samsung and SK Hynix, partly by deferring its use of extreme ultraviolet lithography. DRAM, or dynamic random access memory, chips accounted for 64% of its revenue last quarter. Basically, Micron took Dell’s formula, sprinkled in a little bit of vertical integration, and bet on success. Micron could buy parts from the same suppliers they did, use its own memory, and have higher margins while selling them direct made-to-order like they did.
Returns as of 07/30/2020.Its optical components business sells optical chips to service providers and data center customers, as well as 3D-sensing chips that power advanced cameras and lidar systems in driverless cars. Its top competitors include II-VI, which acquired Finisar last year, and Infinera, which bought Coriant in 2018. This oversupply was a problem that plagued Micron and its competitors in … Lumentum's core business isn't exposed to violent price swings like the memory chip market is, while Apple's upcoming 5G phones and the growing data center market could generate strong tailwinds later this year.Lumentum's revenue growth accelerated over the past four years, while Micron's revenue tumbled last year with sliding memory prices.Analysts expect Lumentum's revenue and earnings to rise 6% and 19%, respectively, this year, as its growth decelerates in the fourth quarter.
The question posed to Micron is if this new work-from-home trend will put an end to the market glut in memory chips. By the way, I did not originate this notion. Lumentum's core business isn't exposed to violent price swings like the memory chip market is, while Apple's upcoming 5G phones and the growing data center market could generate strong tailwinds later this year.Like us on Facebook to see similar storiesLumentum's revenue growth accelerated over the past four years, while Micron's revenue tumbled last year with sliding memory prices.Analysts expect Lumentum's revenue and earnings to rise 6% and 19%, respectively, this year, as its growth decelerates in the fourth quarter.
The remaining 11% came from laser components.If I had to choose one over the other, I'd pick Lumentum over Micron. The remaining 11% came from laser components.If I had to choose one over the other, I'd pick Lumentum over Micron. Samsung and SK Hynix, the main DRAM competitors, are only due to start their production at the 1z-nm node in 2020.
YOY = Year-over-year.Micron expects the headwinds it faced in the first half of 2020 to continue into the second half. Analysts expect its revenue and earnings to decline 12% and 61%, respectively, this year, before rebounding strongly in fiscal 2021. Some of Micron’s competitors, like Dell and Gateway, didn’t make any components at all. Although the company has 3D XPoint manufacturing capabilities in place, that … Thomas J. Engibous: A former chairman, CEO and president at electronics company Texas Instruments, Inc. Engibous helped the company increase its … YOY = Year-over-year.Micron expects the headwinds it faced in the first half of 2020 to continue into the second half.
Therefore, Lumentum is arguably the safer investment for this wobbly market.Lumentum was clearly the stronger investment, but will it continue outperforming Micron over the next few years? Its laser business sells devices for manufacturing, inspection, and life science purposes.Micron could be poised for a strong cyclical rebound, but it's less diversified and faces tougher competitors. Therefore, Lumentum is arguably the safer investment for this wobbly market.Lumentum was clearly the stronger investment, but will it continue outperforming Micron over the next few years?