Shares of Micron Technology (NASDAQ:) are up roughly 4.5% in premarket trading Wednesday after the chipmaker released a stronger-than-expected adjusted revenue forecast for the third quarter.

Adjusted EPS for Micron Q2 was $2.14. That’s an increase from 98c over the prior year. It also surpasses consensus estimates at $1.99 per share. The adjusted revenue for Q2 was $7.79 Billion, an increase of 25% YoY over the consensus estimate of $7.55 Billion.

In the same period, the adjusted gross margin was 47.8%. This is an increase of 32.9% from last year and compares to the analysts consensus of 46.1%. Micron posted Q2 cash flow of operations at $3.63 Billion, an increase of 19% YoY but below the analyst consensus estimate of $3.95 Billion.

Micron anticipates an adjusted EPS of between $2.36 and $2.56 for the third quarter. This is higher than the $2.24 share expected. In the second quarter of 2018, the company anticipates revenues in the $8.5-$8.9 billion range, which is higher than consensus estimates of $8.2 trillion.

According to analysts’ expectations, the chipmaker will expect the gross margin to range from 47% to 49%.

Micron Technology CEO Sanjay Mehrotra said that Micron Technology’s second quarter results were better than our guidance in terms of both margin and revenue. This is a result of strong execution.

Our technology leadership is unmatched in DRAM/NAND and we are accelerating our product portfolio momentum. Micron’s first half results were outstanding and we are on track for strong profitability and record revenues in fiscal 2022.

C.J., Evercore ISI analyst Following strong results, Muse reiterated its Outperform rating as well as a Top Pick designation for MU stock.

Mix and operational excellence were the highlights of February Q, as well as May Q. The company’s execution across 1A/176L/front end and back-end operations allowed it to push through increasing supply chain costs and provide very solid upside for gross margins (180bps/100bps more than consensus), an analyst wrote in a client letter.

Muse also sees MU shares moving to the mid to high-$90s as a possible next stop. This is an improvement to his previous forecast that MU shares would move to the low-$80s. An analyst targets MU shares at $120.00 per share.

ToshiyaHari, a Goldman Sachs analyst reiterated a Buy rating. The price target was lowered to $100.00 from the $110.00 on MU prior quarter.

Based on 1) disciplined supply dynamics in the industry, 2) tightness of Wafer Fab Equipment (which, we believe, will stop the rate at which supply grows for the next 12-18 month), and 3) positive mix dynamics that are idiosyncratic MU to MU, Hari wrote clients.

By Senad Karaahmetovic