Why Micron Stock Is Rising Monday

Micron Technology Inc MU shares are trading higher Monday after competitor Samsung Electronics Co Ltd SSNLF said it would cut memory chip output.

What Happened: Micron on Friday said it would implement "meaningful" cuts to chip production as it faces lower prices due to slowing demand, per Reuters.

"We are lowering the production of memory chips by a meaningful level, especially that of products with supply secured," the company said. 

Samsung did not provide details on the exact size of the planned cuts, but the company said the cuts are currently expected to be short-term moves as it continues to invest in production longer term.

The news comes after the chipmaker reported lower fourth-quarter sales and operating profit. Samsung also issued guidance for the first quarter, noting that it expects consolidated sales of approximately 63 trillion Korean won (47.67 billion) and consolidated operating profit of approximately 0.6 trillion Korean won. 

Micron historically focused on designing and manufacturing DRAM for PCs before the firm expanded into the flash memory market. The company has announced plans to invest heavily in memory chip manufacturing in the coming years.

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MU Price Action: Micron has a 52-week high of $76.22 and a 52-week low of $48.43.

The stock was up 5.96% at $62.05 at time of publication, according to Benzinga Pro.

Photo: courtesy of Micron.