Micron Technology Financial Conference Call · Financial Conference Call 1 June 09. Company...
Transcript of Micron Technology Financial Conference Call · Financial Conference Call 1 June 09. Company...
©2009 Micron Technologies, Inc. All rights reserved. Products are warranted only to meet Micron’s production data sheet specifications. Information, products, and/or specifications are subject to change without notice. All information is provided on an “AS IS” basis without warranties of any kind. Dates are estimates only. Drawings are not to scale. Micron and the Micron logo are trademarks of Micron Technology, Inc. All other trademarks are the property of their respective owners.
©2009 Micron Technology, Inc. | 1
Third Quarter of Fiscal 2009
Micron TechnologyFinancial Conference Call
1 June 09
Company Confidential | ©2009 Micron Technology, Inc. | 2
Safe Harbor
During the course of this meeting, we may make projections or other forward-
looking statements regarding future events or the future financial performance of
the Company and the industry. We wish to caution you that such statements are
predictions and that actual events or results may differ materially. We refer you to
the documents the Company files on a consolidated basis from time to time with
Securities and Exchange Commission, specifically the Company’s most recent Form
10-K and Form 10-Q. These documents contain and identify important factors that
could cause the actual results for the Company on a consolidated basis to differ
materially from those contained in our projections or forward-looking statements.
These certain factors can be found at http://www.micron.com/certainfactors.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of activity,
performance or achievements. We are under no duty to update any of the forward-
looking statements after the date of the presentation to conform these statements
to actual results.
June 09
Company Confidential | ©2009 Micron Technology, Inc. | 3
Ron FosterCFO and VP of Finance
June 09
©2009 Micron Technology, Inc. | 4
Financial SummaryDollars in millions, except per share Q3 – 2009 % of Sales Q2 – 2009 % of Sales
Net sales $1,106 100% $993 100%
Gross margin* 107 10% (267) -27%
Operating (loss) (246) -22% (708) -71%
Income tax (provision) benefit 2 (4)
Noncontrolling interests in net (income) loss
33 51
Restructuring credits (charges) (19) (105)
Net (loss) ($290) -26% ($751) -76%
Diluted (loss) per share ($0.36) ($0.97)
Shares in diluted EPS calc 813.3 773.9
*Including NRV
June 09
©2009 Micron Technology, Inc. | 5
Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09
ASP COGS
Micron NAND ASP & Cost Trends
Note: COGS/GB excludes NRV and idle facility costs
ChangeQ2-09 / Q3-09
ASP/GB (-17%)COGS/GB (-35%)
June 09
©2009 Micron Technology, Inc. | 6
Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09
ASP COGS
Micron DRAM ASP & Cost Trends
ChangeQ2-09 / Q3-09
ASP/Gb (-2%)COGS/Gb (-11%)
Note: COGS/Gb excludes NRV and idle facility costs
June 09
©2009 Micron Technology, Inc. | 7
Operating ExpensesDollars in Millions
$195$184
$163
$180$170 $167
$178$168
$162
$134$143
$112$120 $116
$107 $102$90
$80
FQ3-07 FQ4-07 FQ1-08 FQ2-08 FQ3-08 FQ4-08 FQ1-09 FQ2-09 FQ3-09
R&D
SG&A
June 09
Company Confidential | ©2009 Micron Technology, Inc. | 8
Cash Flow From Operations(Millions of US$) Micron Fiscal Quarter
Competitors: Elpida, Hynix, Inotera, Nanya, Powerchip, ProMOS, WinbondRepresented by a simple average of competitors’ respective operating cash flows
FQ 2Q09 Market excludes Hynix (cash flow data not currently available)Source: Company Data, Finance Strategy Group
* All competitor data based on closest calendar quarter, Micron data based on fiscal quarters
$282
$217
$243
$359$339
$151
-$36-$81
$55
-$38
-$82
-$150
-$100
-$50
$0
$50
$100
$150
$200
$250
$300
$350
$400
FQ 2Q08 FQ 3Q08 FQ 4Q08 FQ 1Q09 FQ 2Q09 FQ 3Q09
Micron Competitors
June 09
©2009 Micron Technology, Inc. | 9
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
MicronFQ 2Q09
MicronFQ 3Q09
WinbondCQ 1Q09
HynixCQ 1Q09
InoteraCQ 1Q09
ProMOSCQ 1Q09
ElpidaCQ 1Q09
PowerchipCQ 1Q09
NanyaCQ 1Q09
Debt to Capital Ratio(Most Recent Quarter)
Debt to Capital = (Long-Term Debt + Current Portion of LT Debt) / (Long-Term Debt + Current Portion of LT Debt + Balance Sheet Equity + Minority Interest)
Source: Company Data, Finance Strategy Group
June 09
©2009 Micron Technology, Inc. | 10
Mark AdamsVP of Worldwide Sales
10 June 09
©2009 Micron Technology, Inc. | 11
0
500
1,000
1,500
2,000
2,500
3,000
0
10
20
30
40
50
60
70
80
90
MB
/ U
nit
PC
Sh
ipm
en
ts (
mil
lio
ns)
Desktop Notebook Desktop MB/Unit Notebook MB/Unit
PC Unit Shipments vs. PC Memory Content
All data is in calendar quarters
Q1-09 – Q4-09 Forecast
Source: iSuppli
June 09
Desktop MB/Unit
4%Q3-09 over Q2-09
Growth
Notebook MB/Unit
9%Q3-09 over Q2-09
Growth
©2009 Micron Technology, Inc. | 12
DRAM Technology Transition
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Source: iSuppli
SDRAM DDR3DDR2DDR
June 09
©2009 Micron Technology, Inc. | 13
Handset Memory Content
June 09
Sources: Gartner, iSuppli, Micron Market Research
* Embedded Only
2008 – 2010 Forecast
16 32 48 6989
291
685
1,283
139
417
866
1,661
0
500
1,000
1,500
2,000
2007 2008 2009 2010
Ave
rag
e M
B p
er
Un
it
DRAM Embedded NAND Cards
DRAM
51%
YoY Growth2008-2009
NAND*
135%
YoY Growth2008-2009
Flash Cards
108%
YoY Growth2008-2009
©2009 Micron Technology, Inc. | 14
Total NAND Market by Application
Source: iSuppli
Mobile Handsets = cards + embeddedComputing = SSD, Hybrid HDD, Robson, etc.Other = Portable gaming, Set Top Boxes, Other consumer
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
2007 2008 2009 2010 2011 2012 2013
Mil
lio
ns G
B
Computing MP3 USB Drives Mobile Handsets Digital Still Camera Others
June 09
©2009 Micron Technology, Inc. | 15
Flash Card Density Migration
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 2010 2011 2012
<2GB
2GB
4GB
8GB
>8GB
Source: iSuppli
June 09
©2009 Micron Technology, Inc. | 16
Memory Industry CapEx (Millions of US$)
Source: iSuppli
10,829 13,510
15,480
21,100
11,053
3,710
3,230
5,330
8,230
10,400
9,900
2,650
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
2004 2005 2006 2007 2008P 2009E
DRAM CapEx NAND CapEx
June 09
©2009 Micron Technology, Inc. | 17
DRAM Capacity Utilization(12” Equivalent Wafers per Month)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
2,000,000
1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09
Utiliz
atio
n R
ate
30
0m
m E
U W
SP
M
Total Available Capacity Total Utilized Capacity Industry Utilization Rate
Source: Finance Strategy Group (DRAM Capacity Model)
June 09
©2009 Micron Technology, Inc. | 18
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09
Utiliz
atio
n R
ate
30
0m
m E
U W
SP
M
Total Available Capacity Total Utilized Capacity Industry Utilization Rate
NAND Capacity Utilization(12” Equivalent Wafers per Month)
Source: Finance Strategy Group (NAND Capacity Model)
June 09
June 09