Shares of Micron Technology (NASDAQ: MU) surged 5.23% in after-hours trading following the release of its fiscal second-quarter earnings report, which exceeded analyst expectations and provided an optimistic outlook for the coming quarters.

The memory chip manufacturer reported second-quarter revenue of $8.05 billion, surpassing the consensus estimate of $7.89 billion. Adjusted earnings per share came in at $1.56, significantly beating the expected $1.42. Notably, Micron's data center revenue tripled compared to the same period last year, highlighting the company's strong position in the rapidly growing artificial intelligence (AI) market.

Micron's President and CEO, Sanjay Mehrotra, emphasized the company's technological advancements and positive trajectory, stating, "We are extending our technology leadership with the launch of our 1-gamma DRAM node. We expect record quarterly revenue in fiscal Q3, with DRAM and NAND demand growth in both data center and consumer-oriented markets, and we are on track for record revenue and significantly improved profitability in fiscal 2025."

The company's guidance for the third quarter further fueled investor optimism. Micron expects Q3 revenue of $8.8 billion, plus or minus $200 million, well above the consensus estimate of $8.49 billion. The projected adjusted earnings per share of $1.57 (plus or minus $0.10) also topped analyst expectations of $1.47.

Micron's strong performance and outlook are largely attributed to the increasing demand for high-bandwidth memory chips used in AI applications. The company reported that its HBM revenue crossed the $1 billion milestone in the fiscal second quarter, underscoring the growing importance of AI-related products in its portfolio. This trend is expected to continue, with analysts predicting DRAM sales growth to average 31% over the next six quarters.

The positive results and forward-looking statements from Micron suggest that the memory chip industry may be entering a more favorable cycle, driven by AI investments and improving supply-demand dynamics. This outlook has resonated with investors, leading to the significant after-hours stock price increase.