Tags: micron | pc | dram

Micron Tech Posts Loss as PC Slump Cuts Prices

Thursday, 29 Sep 2011 07:02 PM

 

  Comment  |
   Contact  |
  Print   |
    A   A  
  Copy Shortlink
Micron Technology Inc., the largest U.S. maker of computer-memory chips, fell in extended trading Thursday after reporting a fiscal fourth-quarter loss on weak demand for personal computers.

The net loss was $135 million, or 14 cents a share, compared with a profit of $342 million, or 32 cents, a year earlier, the Boise, Idaho-based company said in a statement Thursday. Revenue in the period ended Sept. 1 fell 14 percent to $2.14 billion. Analysts surveyed by Bloomberg on average estimated profit of 2 cents on sales of $2.11 billion.

The price of dynamic random access memory, or DRAM, which provides the main memory in PCs, dropped as supply increased and demand from makers of laptops and desktop PCs remained sluggish.

“It looks pretty bad,” said Daniel Berenbaum, an analyst at MKM Partners LLC. “It used to be if you got supply right, you were fine. Now there seems to be something wrong with demand.”

Micron shares declined as much as 4.9 percent in extended trading after slipping 4 percent to close at $5.87 on the Nasdaq Stock Market. The stock has dropped 27 percent this year.

The company is the only remaining U.S.-based maker of DRAM after Asian manufacturers forced out the pioneers of the industry, such as Intel Corp. and Texas Instruments Inc. Producers’ inability to match supply to demand in DRAM has hurt earnings as prices for the chips, which are traded on commodity exchanges in Asia, often fell below the cost of production.

Consumer Business

“The PC business is not super strong going into the holidays,” said Mark Adams, Micron’s head of sales, on a conference call with analysts today. “The consumer business seems off on the demand side,”

DRAM prices have fallen 15 percent this quarter, Micron said.

Separately, Micron said the trial phase of its legal dispute with Rambus Inc. concluded on Sept. 21, and the jury is deliberating on the verdict. A negative outcome could have a material impact on results for the fourth quarter, the company said in the filing.

For the 2011 fiscal year, Micron reported net income of $167 million, or 17 cents a share. Before today, Micron had reported an annual profit in only four of the past 10 years. The company goes head-to-head with South Korea’s Samsung Electronics Co., the world’s second-largest chipmaker behind Intel.

Micron has lessened its dependence on DRAM by following Samsung and Toshiba Corp. into the market for Nand flash memory, chips that provide the storage in portable electronics such as Apple Inc.’s iPhone and iPad.

© Copyright 2014 Bloomberg News. All rights reserved.

  Comment  |
   Contact  |
  Print   |
  Copy Shortlink
Around the Web

Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 

You May Also Like
Around the Web

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved