Summary
Micron Technology Inc. (MU) reported its fiscal second quarter 2013 results, ending February 27, 2013. The company experienced a net loss of $286 million, a slight increase from the previous quarter, primarily driven by significant expenses related to currency hedging for the proposed Elpida acquisition and an impairment loss on asset sales. Despite the net loss, gross margins showed improvement, reaching 18% from 10% in the prior year's quarter, attributed to cost reductions and improved product mix, particularly in DRAM. Net sales saw a modest increase year-over-year, driven by the DRAM Solutions Group (DSG) and Embedded Solutions Group (ESG), though the Wireless Solutions Group (WSG) and NAND Solutions Group (NSG) faced headwinds from declining average selling prices, partially offset by increased sales volumes. The company is actively pursuing a significant acquisition of Elpida Memory, Inc., which is subject to various legal and regulatory approvals. This acquisition, if completed, is expected to substantially increase Micron's wafer capacity and strengthen its market position. Financially, Micron is managing its liquidity through operating cash flows and has recently secured new debt financing. However, the company anticipates substantial cash outlays related to the Elpida acquisition and ongoing capital expenditures, underscoring the importance of market conditions and strategic execution.
Financial Highlights
53 data points| Revenue | $2.08B |
| Cost of Revenue | $1.71B |
| Gross Profit | $366.00M |
| R&D Expenses | $214.00M |
| SG&A Expenses | $123.00M |
| Operating Income | -$23.00M |
| Interest Expense | $56.00M |
| Net Income | -$286.00M |
| EPS (Basic) | $-0.28 |
| EPS (Diluted) | $-0.28 |
| Shares Outstanding (Basic) | 1.02B |
| Shares Outstanding (Diluted) | 1.02B |
Key Highlights
- 1Micron reported a net loss of $286 million for Q2 FY2013, slightly worse than the prior quarter but similar to the prior year's quarter.
- 2Gross margin improved significantly to 18% compared to 10% in Q2 FY2012, driven by cost reductions and a more favorable product mix, especially in DRAM.
- 3Net sales increased 3% year-over-year to $2.08 billion, with the DRAM Solutions Group (DSG) and Embedded Solutions Group (ESG) showing growth.
- 4The proposed acquisition of Elpida Memory, Inc. is a major strategic initiative, subject to regulatory approvals, aiming to increase wafer capacity by approximately 45% and enhance market position.
- 5The company incurred significant losses on currency hedges related to the Elpida acquisition, impacting non-operating expenses.
- 6Capital expenditures are planned between $1.6 billion and $1.9 billion for fiscal year 2013, reflecting ongoing investment in technology and facilities.
- 7Liquidity appears adequate, with cash and equivalents of $2.23 billion, supported by operating cash flows and recent debt issuances.