Micron idles memory manufacturing but outlook cheers
The decision was revealed in a conference call with analysts to discuss Micron’s second fiscal quarter financial results in which the company announced mixed results generally slightly ahead of weak expectations.
Micron’s revenue for the quarter was $5.84 billion, down 20 percent versus $7.35 billion for the same period last year. This was on weak demand for memory and corresponding weak average selling prices.
Micron’s net income of $1.62 billion, compares with $3.57 billion made in the same quarter year before.
DRAM revenue was down 28 percent year-over-year and 30 percent sequentially from the fiscal first quarter. DRAM represented 64 percent of revenue in the fiscal Q2. NAND revenue declined 2 percent year-over-year and 18 percent from the prior quarter. NAND revenue represented 30 percent of revenue in the fiscal Q2.
“Micron continues to execute well across a range of product, operational and financial initiatives against the backdrop of a challenging market environment,” said Micron Technology CEO Sanjay Mehrotra, in a statement.
In the conference call he said: “Given the lower DRAM demand outlook from our customers, we have decided to idle approximately 5 percent of our DRAM wafer starts. This action will bring our production levels close to our view of DRAM industry bit demand growth for calendar 2019. We will continue to monitor the market and take appropriate actions to ensure that our bit supply growth in calendar 2019 remains closely aligned with demand.”
Later Mehotra said: “We are reducing our total NAND wafer starts by approximately 5 percent, mostly through reductions on our legacy nodes.”
Finally he gave an outlook: “Looking beyond our fiscal 2019, we expect bit demand growth to accelerate as mobile and server demand improves. In particular, we expect robust DRAM bit demand growth in fiscal 2020, bouncing back from a weak fiscal 2019.”
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