(Reuters) – Chipmaker Micron Technology Inc (MU.O) forecast current-quarter revenue above analysts’ estimates on Wednesday and said the shift to work-from-home globally due to the coronavirus outbreak is fueling demand for notebooks and data center services.
Authorities around the world have locked down cities, enforced severe restrictions on travel and encouraged people to stay at home to contain the rapidly spreading virus.
Notebooks that support work-from-home and virtual learning are increasingly in demand, Chief Executive Officer Sanjay Mehrotra said on a post-earnings call with analysts.
The jump in remote work is also powering a surge in demand for data center services.
Mehrotra said data center business in China was boosted by increased gaming, e-commerce and remote-work activities as the country locked down many cities and regions to combat the outbreak.
The company is moving supply from smartphone to service the strength in data center markets, Mehrotra said, adding the demand could lead to supply shortages.
Last week, Samsung Electronics Co Ltd (005930.KS) said coronavirus would hurt sales of smartphones and consumer electronics this year, while demand from data centers would fuel a recovery in memory chip markets.
Micron said two of its factories in Malaysia were briefly shut down and is now running production on a limited basis, in compliance with the country’s orders.
The company did not provide any updates about production at its U.S. plants, as states impose shut downs to counter the rapidly spreading virus.
Meanwhile, a group representing major semiconductor companies including Intel Corp (INTC.O) and Micron said on Wednesday it was working with federal officials to make clear to state and local officials overseeing lockdowns that chip companies are essential businesses that should continue operations.
Micron said two of its employees had tested positive for the coronavirus, and are receiving medical attention, without specifying the location details.
The Idaho-based company forecast third-quarter revenue in the range of $4.6 billion to $5.2 billion, the midpoint of which was above analysts’ estimates of $4.87 billion.
The company’s shares rose 5% in extended trading as the estimate followed warning of sales hit by other semiconductor makers such as Apple supplier Skyworks Solutions Inc (SWKS.O).
Reporting by Munsif Vengattil in Bengaluru and Stephen Nellis in San Francisco; Editing by Maju Samuel and Sriraj Kalluvila