June 28 Reuters Micron Technology beat estimates for thirdquarter results on Wednesday, powered by demand for its memory chips from the rapidlygrowing artificial intelligence sector and an easing supply glut in its traditional PC and smartphone markets.

Shares of the company rose more than 2 in trading after the bell. They have gained 34 this year on bets that use of the company39;s memory chips in generative AI servicesrelated servers will skyrocket following the popularity of ChatGPT, OpenAI39;s chatbot.

The recent acceleration in the adoption of generative AI is driving higherthanexpected industry demand for memory and storage for AI servers, while traditional server demand for mainstream data center applications continues to be lackluster, CEO Sanjay Mehrotra said.

Customers continue to reduce excess inventory, leading to improved pricing trends and increased confidence that the industry has passed the bottom for growth and revenue, he added.

After a surge in demand during the pandemic, consumer spending on smartphones and personal computers hit a trough, driving down prices and causing a buildup of inventories.

We believe the current memory industry inventory correction is now behind us, said Summit Insights Group managing director Kinngai Chan.

Industry checks indicate some green shoots in the form of demand stabilization, Chan added, even as demand for PCs, smartphones, and servers is expected to remain mixed in the second half of the year.

Micron39;s…