Shares of Micron Technology (NASDAQ:MU) took a tumble on Friday as the company grapples with potential revenue loss in China. It’s no secret that Micron has a substantial portion of its earnings coming from China and Hong Kong, making up about a quarter of its worldwide revenue. But now, the tech company reveals that about half of its Chinese revenue is in danger. This perilous situation has arisen due to an ongoing review by China’s Cybersecurity Administration of Micron’s products in the country.
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The situation took a dramatic turn last month when the Chinese government flagged Micron Technology’s products for potential network security issues. Authorities even advised operators of critical information infrastructure to steer clear of these products. In light of these developments, Micron admits that a low-double-digit percentage of its global revenue is under threat. However, the company isn’t just watching things unfold passively. Micron stated it’s striving to curb these impacts over time but also noted that it anticipates increased quarter-to-quarter revenue variability.
Turning to Wall Street, analysts have a Moderate Buy consensus rating on MU stock based on 18 Buys, four Holds, and two Sells assigned in the past three months, as indicated by the graphic above. Nevertheless, the average price target of $71.96 per share implies 6.42% upside potential.
