Micron Reports Results… And Sights & Sounds From Robinhood’s Hood Summit 9/30/26

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1:22Robin Hood rolling out round the clock buying and selling. We'll get the implications for the market and for other exchanges and let Tim make up his mind. Plus, a bullish call on Target. Bank stocks wrapping up a miserable month and surging cyber. As AI stocks just keep moving higher, you've no doubt got questions and we are here for you. Hi, everybody. I am Brian. I'm in for Melissa coming to you live from Studio B right here at the NASDAQ. And on your desk tonight, we've got Tim Seymour and Steve here on set. And from the aforementioned Robin Hood Summit in Houston, Texas, sitting together. We have got Dan Nathan and apparently Colonel Guy Adami.

2:02Gentlemen, welcome. It's great to see you both. All right, there's a lot to get to. And we begin with the latest on the read on the AI trade, and that is coming out of Micron. Shares giving back a little bit of the earlier gains are still up, but only up about a half a percent. This after the memory chip maker beat on both the top and bottom lines, the conference call and headlines, they're currently underway and happening. Sima Modi's been listening in, so she's going to jump in and give us a little flavor of some of those details. Sima. Brian, another impressive quarter for Micron, with third quarter earnings growing over 1 ,000 % from a year ago.

2:36Yes, slightly slower than the growth rate it saw in the third quarter, but still commendable given the concerns about memory cycle peaking. CEO Sanjay Mohotra on the call saying memory and storage market will be much tighter in calendar year 2027 and 2028, So it remains an industry constraint, he says, by a lack of supply due to rising demand. He also mentions autonomous cars and robotics as tailwinds. He also said we do not have a line of sight when supply-demand equation balances out and that CapEx will increase in 2027 as it adds more capacity here in the U.S. and overseas in markets like Singapore.

3:10In fact, it just poured concrete on its first New York fab with initial wafer output expected in about four years. The stock, interestingly enough, basically flat after gaining a 270 percent this year. Exclusive sit down with Sanjay Mahotra as CEO tomorrow morning at 10 a.m. Brian. All right, Seema Modi, I know you've got to jump back on that call. We may see you again. Seema, thank you very much. We don't know a whole lot right now, Tim, but of what we do know or just the stock in general, what do you think? I think it's good. I think the margin profile is what we really should be focused on because the 11-fold growth in data center is not something you're going to have year over year out two years, I don't think.

3:48But the margin profile is very important. Pricing, obviously, longer-term contracts. I think what's been fascinating from the market's perspective is that the memory names have kind of taken a step back behind the CPU names in the month of September, although it was a very good month for Micron. And if you follow the KOSPI in Korea, it's another way of just kind of gauging what's going on in the memory space. And we also know that there are other players out there ramping up demand, whether it's CMXT that we've been hearing more about out of China. The story is not, I think, without turbulence ahead.

4:17And I'm not chasing Micron here, but there was nothing wrong with this print. You know, Steve, we look at a 10-year chart of Micron technologies. And from basically eight and a half to nine years of those 10 years, the stock did almost nothing. I mean, you could trade a little bit, make money. Trade it right with DRAM. $40 to$70 range for six or seven years. It was dead money. Took off last year. It's gone from$60 to$1 ,100 in a year. And I'm not taking anything away from Mike Braun. It's made a lot of money for its investors and employees, people in Idaho. That's a hell of a move. It is a hell of a move.

4:51But what did we hear yesterday at the White House? That there's going to be a lot more agents. Look at that chart. Look at that chart. Okay. That may be more than the GDP of Idaho. Sorry, with all due respect. No, I mean, listen, it might be. My point is, anything about the valuation that concerned? Well, there's no problem with the valuation in my account. The problem is, when does the story over? But the story, I would have thought that it would have backtracked a lot sooner than it has. It has come off the highs. But I actually think I'm reversing now. I think it could actually go higher because agents create token demand.

5:29Tokens are inference, and inference runs on memory. So if we're going to have a battle over the bots, Micron is probably going higher from here. And, Dan, Nathan, I'm going to reverse myself because even with that chart that I showed you, I'm looking on CNBC.com and FaxNet and everything else. Ford PE is still historically low on Micron, even at$1 ,100 whatever a share. Yeah, so that doesn't really matter. And I think you know that, Brian. I mean, this is a company that lost money three years ago in 2023. They had negative gross margins. And so now they're able to have all this pricing pressure.

6:05It's a supply-temand situation. Those beats that we're talking about that took the stock from$100 to$1 ,200, they're behind them. I mean, the magnitude of those beats. If you just look at the quarter they just reported, they basically beat consensus by about 5%, 6 % of earnings and sales. You look at that guidance that they just gave for the current quarter, and maybe that's up 8%. So the year of the days or the quarters of having this like 50 percent, 100 percent kind of beats, they're gone. All right. So at this point in that margin profile that Tim talked about, he's 100 percent. You know, they are taking they are taking right now.

6:38They have the ability to do that. They have the pricing power. But I guess into to to Steve's point about inference and, you know, all of the pricing dynamics that you have with tokens. Yes, that's going to be great. The agent stuff is going to be great for memory. But I guess the point is, where does the stock go from here based on everything that we know and the fact that we're not going to see the levels of beats that we've seen before? I think investors are going to start pricing in best-case scenarios. And I think that's one of the reasons why you have such a muted reaction in the aftermarket right now.

7:08You got 51 analysts, Skydami, that cover Micron. You got 49 buys or strong buys, a couple of holds, no sells. The stock's done that. I mean, it's made a lot of people a lot of money. I'm not trying to be a negative Nelly here about Micron. I'm glad it's made a lot of people money, but I'm worried about the next 12 months, not the previous 12 months. What do you think? Why would you be a negative Nelly? And watch what I do here, Brian. I know Tim will get this. There is no small potatoes about this quarter. See what I did there, Brian? Micron initially funded with J.R. Simplot money from potatoes.

7:46I'll take random Micron trivia for 600, please. $400 ,500. But the reality is, Steve mentioned it, what do they call that thing at the White House yesterday? A gaggle? And when they all walked out hand in hand and talked about sort of putting their foot on the gas pedal, continuing to put on their foot on the gas pedal, that is obviously very supportive of the entire trade that Micron finds itself at the center of. The move should have taken place either today or, again, in the after hours with this release. It's an extraordinary number. 86 % margins are nothing to sneeze at. But there's the old saying from Amazon, you know, your margins are our opportunity.

8:20And although competition is not coming tomorrow, competition is coming. So we know all the numbers. And you have to ask yourself, a stock that was supposed to move 7 % or 8 % given the options market is not moving at all. And to Dan's point, you know, maybe there's something to glean from that. Well, I would look at what's going on in the semi-space. And let's just throw that whole group that are leased in the SMH, but including memory as being the one part of the market that's actually working. As much as I don't necessarily want to chase and be the next dollar into Micron, I can tell you that the chart on Micron, and I can tell you what Semis did in September in a quarter that was pretty lackluster for the rest of the market.

9:00We're going to talk about that in a second. But I just feel as if this is a space and this is a trade that continues to have legs behind it. And it's a trade that continues to outperform the rest of the market. So as much as I'm not chasing memory here and as much as all we keep hearing from Samsung and SK Hynix is that they are building out more memory and more capacity. And, you know, it's actually pretty exciting for the world that we're also building more out here and that Micron is very much involved. They broke ground and cement in New York City. That's great. I do think supply is an issue at some point.

9:30I think the market's not going to wait for that. Yeah. I mean, the CEO is saying he sees a tighter supply demand environment coming. I don't know if that's good or bad, though, Steve. He's saying that these aren't supposed to be commodities. They can't make enough chips. It's tight supply. Yeah, these are. I don't know. Well, that's the trillion dollar question. When does this supply actually hit the market? But it doesn't sound like it's coming anytime soon. And we are talking about a three-horse race. So there's enough room to send these things higher. You know, I look at that margin. I get what Guy is saying.

10:01But I look at the actual share out of the three players, and there's plenty of room for Micron to gobble up someone else's share. So I think if you look at it through that prism, that chart looks steep, but it looks like it can climb again. All right, well, the stock is down a touch right now. I'm not going to make too much of a 1 % move. It's at$1 ,055 because it was a$45 stock just a couple of years ago. All right, in the meantime, the macro market's taking a bit of a turn down later on in the session. I mean, the Nasdaq did close higher, but not nearly as much as it was. President Trump posting on True Social that former Federal Reserve Chair Jerome Powell should resign from the Federal Reserve over failures in managing the renovations of its headquarters.

10:48Remember, Powell no longer the chairman, but he is still on the Federal Reserve committees. He's still there for, I think, another two or three years. The S &B and NASDAQ had been positive for most of the day after new inflation data showed. Price pressures moderated a bit in August. That set expectations for a Fed rate hike next month down there. And now, if you look at the October 28th meeting, the odds of a rate hike, well, they're not zero, but they're down to less than 40 percent. They were 71 percent just one week ago. Interest rates, though, today still higher across the board. Bond investors turning their attention to Friday's jobs numbers.

11:27Economists expect payrolls grew by 84 ,000 in September. How will all these numbers, Tim, do we think really impact the market? Because I feel like there's two things going on right now. There's three. There's the war. There's energy in the war. You've got all this AI stuff. But at the same time, or maybe because of it, we're watching interest rates just keep going higher. Yeah, we closed a new high on the 10-year. And right now, equity valuation. This is what I'll say about the stock market relative to that. Let's get into inflation and the Fed. But equities have done a great job of actually taking on a lot of this move.

12:01And, in fact, I think you have a disproportionate move higher the minute you start to give ground back. In other words, I think it's asymmetric from the market's perspective. The next move down in yields will outperform the move higher. Stocks have really moved higher in yields. So what am I saying? I actually think that the market is looking past this right now. You can make an argument that the correlation of oil prices and everything else is something that the market is willing to take on. I think if you look at long-term yield charts, and if you, again, I bring back the Guyadami 40-year-old chart, because I think it makes a lot of sense when you're looking at the yield curve.

12:35It actually looks like we could be going to 6%, and 6 % for equities at some point is a different ball going on. And I think the whole thing is at some point, because Guy and Dan, I know back in your day you listened to these things called records, right? It was like always at the record out of scratch. They'd call it a broken record because they would just keep saying and playing the same thing over and over and over and over again. I've been a broken record about 5 % yields of the market, taking down stocks. Obviously not the case. Is there, though, a number on the 10-year that does change the tune?

13:12Dan? You know, it's not just the 10-year. It's like, think about what's going on in investment grade debt as it relates to AI build out, right? You're getting like 6%, maybe 7%, some a little higher as you get kind of into, you know, some of the riskier sort of stuff. So there's opportunities away from equities, especially if you're worried about the AI build out and the exposure that you have in the S &P 500. If you have 5.3 % over 10 years, you have a two year that's basically almost inverted the 10 year. It's just basically telling you that the equity risk premium in stocks right here isn't particularly great.

13:47And I think going back to that micron, it's a perfect example. Forget the valuation. It's just like, look at the price performance. Look at how much it's kind of incorporated right now. I think that's a story where you'd rather own the debt than the equity. And I just think there's going to be lots of places where people, as they get more worried about, let's say, the macro, maybe it's geopolitics, maybe it's inflation, and they start thinking about what this AI trade could do if it were to soften. And I think you're going to have a move out of equities. And I think there's going to be a lot of other alternatives.

14:16Sorry, let me just add. I mean, since that operation twist, whatever that was, Treasury did. And obviously, Treasury understand that there's a problem. Ten-year yields are up about 65 basis points. I think they were four and three quarters-ish when they started that. So the bond market is not only challenging the Fed, they're challenging Treasury as well, which is something historically we really haven't seen. I think that's number one. And number two, I'm with you, Brian. I mean, I've been saying for a while that I thought higher rates would put a kibosh on the stock market. Clearly not the case.

14:45But you know what it does put a kibosh on? I mean, if you think about the amount of debt that needs to be raised, I mean, this is not an economy nor stock market, I think, that's built for rates to go higher, which I do think will continue to go higher. It's a great point, Guy Dami, because the AI boom is largely built on debt. And does this kill quickly that side of the debt market? I know Google's not borrowing at 6%. I get that. But they are going to have to pay more, I think, to the market now. Oh, that was me. I'm sorry, Brian. I apologize. Yes. The question is how much more? And you want a cautionary tale.

15:19I mean, go back to Oracle. And I think it was like December. You know, I lose track of time. September of 2025. September of 2025. The stock had a 45 percent move to the upside on the back of all the exuberance. So what that stock has done since. And now it's a balance sheet thing, and it is a debt thing, and it's can they raise the amount of capital necessary to continue this. Oracle has clearly pushed all their chips to the middle of the table, saying they're going to be the centerpiece of the AI buildout. And maybe they're going to wind up being right. But just look what happened to that stock.

15:49And if you don't think it could happen to others, I think you're not paying attention. All right. So we've got a lot more to get through, but we're going to bring in another voice into this name. Tiffany Wade is Senior Portfolio Manager at Columbia Threadneedle Investments. She co-manages the Columbia Cornerstone Growth and Equity Funds. A lot of these stocks that we've talked about or at least referenced, Tiffany, and by the way, welcome. Great to see you. Great to see you. You own, in fact, they're probably amongst your top holdings and your fund. What do you worry about? You know, I do think we worry about interest rates, as we were talking about just before.

16:22We thought that this would put a damper on stocks as well, maybe heading into the midterm. Clearly, that hasn't been the case. We saw great GDP numbers today, good consumer spending numbers. So clearly there's a lot of good things happening in the economy that our equity investors are focusing on rather than rates. That's something that we certainly do worry about. Yeah, because I want to ask this to the guy, but I'll ask it to you. Is it the what or the why? The what is a 5.3 10-year, 5.4 10-year, 6%, whatever it is. Does the why matter more than the what? Right now it does seem that the why matters more, right?

16:54At a certain level of interest rates, the what will matter. But right now, the why seems to matter more. So, Tiffany, the what around Micron, which you own, is clearly phenomenal growth, but a margin story that's really holding up. Talk to us how you've assessed that after the kind of movie. And you've probably held this for a while. I'll assume you have. But what do you do with it now? Because this is what we're wrestling with. Yeah, we still like memory stocks a lot. We think that this is going to be central to the AI build out. the more inferencing and the more agentic AI you have, the more memory you're going to need.

17:25And they were talking about how they see capacity being tighter in 27 and 28. So we think these are great places to be. So when you look at the market, just getting back to your first glance at this, the market's up 12 % for the year. Earnings are growing at roughly 25%. So that's the reason why yields are not affected. No one's worried about the discount rate when earnings are growing at 25%. But to Tim's question, just to follow on on that, what sectors are you most excited about? And do you change those with the rising rate? Yeah, that's a great question. So we still really like AI, which means we obviously have a lot of bets within tech and some within industrials as well.

18:03Certainly memory, as I mentioned before, cybersecurity we like a lot. And then outside of tech, we think there's some interesting things happening in healthcare, and that space is a little bit more rate agnostic. So some of the tools and diagnostics companies, which have been laggards for years, are starting to look a little bit more interesting. So we look at we had micro earnings tonight. OK, we got Apple. We get all the earnings that are out on a macro level. Tiffany, what do you and your team watch the most closely? Is it the Fed? Is it jobs numbers, inflation data? I know you look at it all.

18:29I know I know you say we look at it all. But if there's one thing that really catches your attention, is there something? Yeah, I think the tooth I'll go with two things. So first is I think the outcome of the midterms is going to be a really important macro data for the market. I agree. And then energy prices is the other one right now. Yeah, because we've got, and we're not going to dip into politics too. I get it, but only vis-a-vis the markets. You've got some people that are pretty anti-data center right now. I mean, it's a political thing, but it's a market thing. Because if there is a slowdown in data centers because politicians win that are anti-data center or want to pause data centers, then some of that CapEx, that OpEx, I think gets slowed down.

19:06Is that sort of a theory behind the political view? And it's not a political view, but the election view. Absolutely. And I think we're seeing that play out in stocks right now. And so we're seeing, especially in the industrial space, stocks related to construction and equipment that goes into building data centers is lagged recently. And I think that's related to that concern. But maybe that gets alleviated after the midterms. Are you exposed at all to the growth part of the trade, the growthier part, though, of really the infrastructure part of that trade? The extreme example is someone that owns Caterpillar for data centers.

19:33But what part of a growth fund is investing in more picks and shovels? And has any of that changed for you? I mean, industrials as a group have been deaf in the last three weeks, as in fact, as most of the rest of the market has been. But the picks and shovels, where are you still excited? Yeah, we still really like the electrical equipment names. We still like the construction engineering names. So we think those have a long tail of growth for the next couple of years. But you're clearly seeing some people concerned about when does CapEx peak and does that hit the industrial names harder than some of the tech names that may have a longer tail of equipment that goes into data centers.

20:06I got to imagine, quick, we're going to wrap it up, but I got to imagine the backlog of these construction firms is years. Yeah, absolutely. It's years. Yes. Hopefully nobody will issue a force majeure. We had Oracle threaten one. These things are kind of on the radar. It's a complicated term. There's a lot in that. It is. It's French for force majeure. Tiffany, thank you very much for joining us. Really appreciate your time. Thank you. All right, coming up, we are also not just watching Micron. We're watching Google because Google announcing its newest Gemini model. We're going to tell you what we know.

20:40Plus, a rough month for banks. I mean, a dismal month for banks. That group gearing up for earnings in the next couple of weeks. How our traders are positioning in the financials all ahead. Fast Money. Back at 2.

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