Many stock market participants were waiting for Micron Technology’s quarterly report because it gives a certain impression of the situation not only in the memory market but also in the entire semiconductor industry. Micron’s fiscal third quarter was marked by a steady 1.6% increase in revenue and a decline of more than double year-over-year. In the current quarter, Micron expects steady revenue growth, which investors care about even more than the previous period’s results.
As a result of the Chinese authorities’ decision in late May to ban Micron products from critical national infrastructure, the company will lose about half of the sales of companies headquartered in China and Hong Kong, according to current management forecasts. Given that such customers account for up to a quarter of Micron’s total revenue, losses from the Chinese sanctions may end up amounting to about 12% of the company’s total revenue, as mentioned in Micron Technology’s presentation to investors. These circumstances will not deter Micron from investing up to $600 million in the development of its Xi’an facility in China over the next few years. The memory chip testing and packaging facility will be built in India, while Micron will expand its facilities in Taiwan and Japan will be the first chipmaker to use EUV lithography equipment.
Calendar 2023 year, by prognosis for Micron, budget in the cell by the characteristics of the rust on п амять типа DRAM на 2–5%, по памяти типа NAND прогноз укладывается в диапазон от 8 до 9%, что ниже долгосрочных Prognosis by the temperature of the rust of the other in general. According to Micron, demand should pick up in the second half of the year. At the same time, the supply volumes will be reduced in both directions by the end of 2023 for the entire industry, especially for Micron, a significant drop will be observed in the DRAM segment.
The company reduced its capital expenditures by 40% year over year to $7 billion, including spending more than 50% to purchase silicon wafer processing equipment. According to company management, the latter expenses will be lower in the next financial year than in the current one. Micron also recently reduced the number of silicon wafers it processes in DRAM and NAND production by an average of 30% and won’t increase it until early 2024.
Micron Technology ended the fiscal third quarter with revenue down 57% year over year to $3.8 billion, but grew steadily by nearly 2%. Quarterly revenue was 71% driven by DRAM sales, with NAND accounting for 27%. In the first direction, revenue steadily decreased by 2%, physical delivery volume increased by about 10%, and average price decreased by 10%. In the NAND segment, revenue increased 14% sequentially, shipments increased 30%, and average selling price decreased approximately 15%. $400 million of excess inventory for the quarter was written off. Operating expenses were $866 million, operating losses were $1.5 billion and net amount was $1.6 billion.
For the current fiscal quarter, Micron expects to collect between $3.7 billion and $4.1 billion, with steady revenue growth in the middle of that range. Operating expenses are expected to be kept within $860 million and yield will fluctuate in the negative range of 8% to 13% from the current minus 16%. Micron’s revenue guidance for the current quarter came in above analysts’ expectations, which focused on an average of $3.87 billion. After the close, shares of the company were up 3%. According to the Micron management, the memory chip industry as a whole has passed the low point in terms of sales dynamics, and the profit margin is likely to recover as the balance between supply and demand is restored. Directly for Micron, the situation with Chinese sanctions against its products poses an additional problem, which, however, will only slow, not cancel, the recovery of the company’s financial performance.
By the end of this year, according to Micron management, the volume of component deliveries in the PC segment will decrease by a double-digit percentage, in the smartphone segment the decline will be limited to 4-6%. In view of the Chinese sanctions, the company emphasizes its focus on maintaining its position in the global storage market.