Micron headquarters in Boise, Idaho. Image source: Google Maps.

Shares of Micron Technology (MU -4.61%) took a swan dive last week, when sector rival SanDisk (NASDAQ: SNDK) slashed its quarterly revenue guidance. Investors worried that SanDisk's bad news might spill over to other players in the flash memory market.

Micron just erased that concern with a solid second-quarter report -- only to fall back again when management tipped its hand on a soft third-quarter outlook.

The company reported total sales of $4.2 billion, yielding adjusted earnings of $0.81 per diluted share. The revenue figure was in line with Wall Street's estimates, but analysts would have settled for just $0.73 per share on the bottom line. Earnings estimates have been sliding lower over the past three months. Micron trumped the final tally by a wide margin, also exceeding the Street consensus as it stood at the start of February.

Earnings decreased by 5% year over year, while sales fell 9% lower. However, this was a 13-week quarter but the year-ago period covered 14 weeks.

In other words, this reporting period was about 7% shorter than the second quarter of 2014. Back out this calendar effect, and you'd be looking at nearly flat sales with modestly higher earnings.

Micron saw weakness in its DRAM memory market, where both shipped memory capacity and average unit prices declined year over year. For NAND flash memory, 12% higher volume made up for 9% lower average unit prices.

The computer and networking division, which sells DRAM and flash memory to makers of traditional computer systems and networking equipment, remains Micron's largest unit, with $1.8 billion in second-quarter sales. Mobile memory carries the company's juiciest operating profit margins, at 30.6%.

The problem child in Micron's product portfolio is the storage division, which reported a cool $954 million in sales paired with a negative profit margin.

Micron shares jumped as much as 6% higher in early after-hours trading, buoyed by the strong results. But that quick lift disappeared immediately when management held its customary earnings call, which included a disappointing set of guidance figures for the third quarter.

Analysts were expecting third-quarter earnings near $0.77 per share on roughly $4.3 billion in sales. The official guidance ranges came in below these levels, at $0.70 per share and $3.9 billion, respectively. Specifically, Micron sees weak demand for DRAM memory in the PC systems market.

That happens to be exactly the market that drives most of SanDisk's business, so those nervous Micron investors from last week turned out to be on the right track. Micron's business is indeed going to suffer from some of the same market conditions that caused SanDisk to take a hatchet to its own estimates, only with a slight delay.

Micron's diverse product lines and large overall share of the memory market tend to insulate the company from drastic demand changes, but the company is not completely immune to these dangers. Micron shares have still crushed the market over the past 52 weeks, despite a terrible start to 2015 -- share prices have now plunged 24% lower year-to-date.

So Micron remains as volatile as ever. It's probably not the best stock in the world for risk-averse investors, but I'm thinking about adding a few more shares to my existing real-world Micron position at a P/E ratio below 9 times trailing earnings.

There's plenty of runway ahead of this stock, if you can handle some of these uncomfortable potholes along the way.