3 Min Read
By Noel Randewich
SAN FRANCISCO, Dec 20 (Reuters) - Micron Technology posted a quarterly net loss and lower revenue as it struggled with a slowing PC industry and macroeconomic uncertainty.
Consumers' growing preference for smartphones and tablets instead of laptops has been hurting PC manufacturers, which traditionally have been major buyers of DRAM chips made by Micron and rivals like Samsung Electronics.
Global economic uncertainty has also held down prices for chips, including the NAND memory, used by Apple and other manufacturers of smartphones and tablets.
The Boise, Idaho-based memory chipmaker said fiscal first-quarter revenue was $1.83 billion, down from $2.09 billion in the year-ago period.
Analysts had expected revenue of $2.005 billion for the quarter ended in November, according to Thomson Reuters I/B/E/S.
Micron said revenue from NAND chips was down 4 percent in the first quarter, compared to the previous quarter, with higher prices failing to make up for lower volume.
DRAM revenue was down 9 percent from the previous quarter because of a 9 percent drop in prices.
Reacting to surging sales of Apple's iPads, iPhones and other devices, chipmakers ramped up their NAND production capacity, but a supply glut drove prices to new lows this year.
CEO Mark Durcan told analysts on a conference call that DRAM prices have risen so far in the current quarter but warned that it's too early to point to a trend.
"We're cautious in the short term, but optimistic about the evolving industry supply-demand balance," Durcan said.
Low prices and steadily rising investment costs to implement new technologies have been driving consolidation in the highly competitive and cyclical memory chip industry.
In the industry's latest consolidation, Micron plans to buy failed Japanese chipmaker Elpida Memory Inc for $2.5 billion, including future payments to creditors, a deal it expects to close in the first half of 2013, despite opposition from a group of debt holders.
The acquisition would push Micron into second place behind market leader Samsung in the global market for DRAM chips.
Micron posted a net loss of $275 million, or 27 cents a share, compared to a net loss of $187 million, or 19 cents, in the year-ago quarter. Analysts expected a net loss of 20 cents per share.
Shares of Micron were down 2.79 percent in extended trade after closing down 0.44 percent at $6.79.