Micron Q109_Earnings_Call

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Micron Q109_Earnings_Call

  1. 1. Micron Technology Financial Conference Call First Quarter of Fiscal 2009 ©2008 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. December 2008 ©2008 Micron Technology, Inc. | 2
  2. 2. Safe Harbor During the course of this meeting, we may make projections or other forward- looking statements regarding future events of 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. December 2008 ©2008 Micron Technology, Inc. | 3
  3. 3. Ron Foster CFO and VP of Finance December 2008 ©2008 Micron Technology, Inc. | 4
  4. 4. Financial Summary Dollars in millions, except per share Q1 – 2009 % of Sales Q4 - 2008 % of Sales Net sales $1,402 100% $1,449 100% Gross margin* (449) -32% (65) -4% Operating (loss) (672) -48% (338) -23% Income tax (provisions) (13) (2) Non-controlling interest in net 13 11 (income) loss Restructuring credits (charges) 66 (4) Net (loss) ($706) -50% ($344) -24% Diluted (loss) per share ($0.91) ($0.45) Shares in diluted EPS calc 773.3 772.9 *Including NRV December 2008 ©2008 Micron Technology, Inc. | 5
  5. 5. Micron DRAM ASP & Cost Trends ASP COGS Change Q4-08 / Q1-09 ASP/Gb (-34%) COGS/Gb (-12%) Q3-07 Q4-07 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Note: COGS/Gb excludes NRV and other adjustments December 2008 ©2008 Micron Technology, Inc. | 6
  6. 6. Micron NAND ASP & Cost Trends ASP COGS Change Q4-08 / Q1-09 ASP/GB (-24%) COGS/GB (-14%) Q3-07 Q4-07 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Note: COGS/GB excludes NRV and other adjustments December 2008 ©2008 Micron Technology, Inc. | 7
  7. 7. Operating Expenses (Millions of US$) $195 $184 $180 $178 $170 R&D $167 $163 $143 $134 SG&A $116 $120 $112 $107 $102 FQ3-07 FQ4-07 FQ1-08 FQ2-08 FQ3-08 FQ4-08 FQ1-09 December 2008 ©2008 Micron Technology, Inc. | 8
  8. 8. Cash Flow From Operations (Millions of US$) Micron Market $400 $359 $276 $282 $300 $243 $217 $200 $100 $101 $0 -$41 -$100 -$88 -$144 -$200 FQ 1Q08 FQ 2Q08 FQ 3Q08 FQ 4Q08 FQ 1Q09 * All competitor data based on closest calendar quarter, Micron data based on fiscal quarters Market: Elpida, Hynix, Qimonda, Nanya, Powerchip, ProMOS, Winbond ** Qimonda based on Cowen estimates Represented by a simple average of competitors’ respective operating cash flows Source: Company Data, Finance Strategy Group December 2008 ©2008 Micron Technology, Inc. | 9
  9. 9. 2009F Capital Expenditures 41% 36% Micron IM Flash 23% TECH $650 – 750 million December 2008 ©2008 Micron Technology, Inc. | 10
  10. 10. Mark Adams VP of Worldwide Sales December 2008 ©2008 Micron Technology, Inc. | 12
  11. 11. Memory Pricing DRAM & NAND Spot Market ASPs 3-Month Decline 1 Gb 128Mx8 667MHz DDR2 NAND 1GB 1024Mx8 (MLC) 0% -10% -20% -30% -40% -50% -60% -70% Sep-08 Oct-08 Nov-08 Source: DRAM eXchange December 2008 ©2008 Micron Technology, Inc. | 13
  12. 12. PC Unit Shipments vs. PC Memory Content Notebook Units Desktop Units Desktop MB/System Notebook MB/System 100 3000 80 2400 Desktop, Notebook Units in Millions Average MB per System 60 1800 40 1200 Growth Growth Growth ’06 – ’07 ’07 – ’08 ’08 – ’09 20 600 56% 56% 33% 2004 2005 2006 2007 2008 2009 2004 2005 2006 2007 2008 2009 Average Average Average Average Average Average Average Average Average Average Average Average 409 MB 555 MB 772 MB 1207 MB 1207 MB 1856 MB 1882 MB 2451 MB 413 MB 555 MB 772 MB 2499 MB 0 0 1Q-04 2Q-04 3Q-04 4Q-04 1Q-05 2Q-05 3Q-05 4Q-05 1Q-06 2Q-06 3Q-06 4Q-06 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3Q-08 4Q-08 1Q-09 2Q-09 3Q-09 4Q-09 All data is in calendar quarters Q2-08 – Q4-09 Forecast Source: iSuppli December 2008 ©2008 Micron Technology, Inc. | 14
  13. 13. Micron’s Module Density Transition DDR2 100% 4GB 8GB 4GB 4GB 90% 4GB 80% 4GB 2GB 70% 2GB 2GB 60% 2GB 2GB 50% 1GB 40% 1GB 512MB 30% 1GB 20% 1GB 1GB 256MB 10% 0% Q2 (FY 2008) Q3 (FY 2008) Q4 (FY 2008) Q1 (FY 2009) December 2008 ©2008 Micron Technology, Inc. | 15
  14. 14. Server Memory and Unit Growth Weighted Average MBs per System Server Forecast in Millions of Units 60,000 12 Weighted Average MBs per System Server Forecast in Millions of Units 50,000 10 40,000 8 30,000 6 32% YoY Growth 2008-2009 20,000 4 10,000 2 0 0 2006 2007 2008 2009 2010 2011 2012 Source: IDC December 2008 ©2008 Micron Technology, Inc. | 16
  15. 15. Handset Memory Content 2000 1,916 DRAM Embedded NAND Flash Cards 1500 Average MB per System 1,110 1,106 NAND* Flash Cards DRAM 123% 117% 43% 1000 YoY Growth YoY Growth YoY Growth 2008-2009 2008-2009 2008-2009 698 497 500 322 188 141 74 52 36 24 0 2007 2008 2009 2010 * Embedded Only 2008 – 2010 Forecast Sources: Gartner, iSuppli, Micron Market Research December 2008 ©2008 Micron Technology, Inc. | 17
  16. 16. Total NAND Market by Application 80,000 70,000 Other 60,000 Non-Mobile Flash Cards 50,000 Billions of MB Mobile Handsets 40,000 30,000 USB Drives 20,000 MP3 Players (Flash Based) 10,000 Computing - 2007 2008 2009 2010 2011 2012 Mobile Handsets = cards + embedded Computing = SSD, Hybrid HDD, and PC Cache Other = Portable gaming, Set Top Boxes, Other consumer Sources: iSuppli, Gartner, Micron Market Research December 2008 ©2008 Micron Technology, Inc. | 18
  17. 17. Product Technology Innovation 68nm 1Gb DRAM Log Cell Size 50nm 1Gb DRAM 34nm 32Gb NAND Today DRAM NAND December 2008 ©2008 Micron Technology, Inc. | 19
  18. 18. Channels & Alliances Examples Retail OEM Channel Distribution Partner Alliances E-Commerce December 2008 ©2008 Micron Technology, Inc. | 20
  19. 19. Lexar and Crucial Products Cards for Photography Mobile Cards Gaming Cards Good Cards Better Cards Best Cards Mobile Cards Gaming Cards Solid State Drives USB Flash Drives DRAM Modules December 2008 ©2008 Micron Technology, Inc. | 21

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