GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Micron Technology Inc. Reports Operating Results (10-Q)

January 07, 2013 | About:
10qk

10qk

18 followers
Micron Technology Inc. (MU) filed Quarterly Report for the period ended 2012-11-29.

Micron Technology, Inc. has a market cap of $7.08 billion; its shares were traded at around $7.18 with and P/S ratio of 0.8.

Highlight of Business Operations:

Total net sales decreased 12% for the first quarter of 2013 as compared to the first quarter of 2012 primarily due to decreases in WSG, NSG and DSG sales as a result of declines in selling prices, mitigated by increases in gigabit sales for NSG and DSG.

NSG sales of NAND Flash products to trade customers for the first quarter of 2013 decreased 8% as compared to the fourth quarter of 2012 primarily due to a decrease in gigabits sold. NSG operating income increased slightly for the first quarter of 2013 as compared to the fourth quarter of 2012 primarily due to improvements in average selling prices and cost reductions from improvements in product and process technologies.

NSG sales of NAND Flash products to trade customers for the first quarter of 2013 increased 20% from the first quarter of 2012 primarily due to increases in gigabits sold partially offset by declines in average selling prices. NSG operating income declined for the first quarter of 2013 as compared to the first quarter of 2012 primarily due to decreases in average selling prices mitigated by cost reductions.

WSG sales for the first quarter of 2013 decreased 29% as compared to the first quarter of 2012 primarily due to declines in sales of wireless NOR Flash products as a result of weakness in market demand and our customer group in particular, as well as a continued transition by customers to NAND Flash. WSG sales for the first quarter of 2013 as compared to the first quarter of 2012 were also adversely impacted by lower sales of NAND Flash products sold in multi-chip packages. WSG experienced pricing pressure in the first quarter of 2013 due to weakness in demand from certain customers. WSG operating margin declined for the first quarter of 2013 as compared to the first quarter of 2012 primarily due to lower average selling prices mitigated by cost reductions.

We have the right and obligation to purchase 50% of Inotera's wafer production capacity under the Inotera Supply Agreement. We have rights to receive a higher share of Inotera's 30-nanometer output when it becomes available. DRAM products acquired from Inotera accounted for 49% of our DRAM gigabit production for the first quarter of 2013 as compared to 47% for the fourth quarter of 2012 and 43% for the first quarter of for 2012. The higher level of production from Inotera was achieved through Inotera's continued transition to advanced product and process technologies. We primarily obtained DDR3 DRAM products for the PC market from Inotera. Our cost of wafers purchased under the Inotera Supply Agreement is based on a margin-sharing formula among Nanya, Inotera and us. Under such formula, all parties' manufacturing costs related to wafers supplied by Inotera, as well as our and Nanya's revenue for the resale of products from wafers supplied by Inotera, are considered in determining costs for wafers acquired from Inotera. Our cost of products purchased under the Inotera Supply Agreement in the first quarter of 2013 were lower than our cost of similar products manufactured in our wholly-owned facilities.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 3.5/5 (2 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK