Micron Technology Inc, the largest US maker of computer-memory chips, reported its fifth-straight quarterly profit as buoyant demand for products used in smartphones helped it withstand a slump in computer memory.
Net income in the period that ended Dec. 2 fell to US$155 million, or US$0.15 a share, from US$204 million, or US$0.23, a year earlier. Fiscal first-quarter sales rose to US$2.25 billion, Boise, Idaho-based Micron said yesterday in a statement. Analysts, on average, had predicted revenue of US$2.37 billion.
Micron is entering a second year of profit after a three-year glut of memory chips, which are used in personal computers, resulted in industry-wide losses. Chief executive officer Steve Appleton said the company benefited from demand for electronics such as Apple Inc’s iPhone even as sales of computer memory dropped 19 percent from the preceding quarter.
“They are still firmly in the black,” said Kevin Vassily, an analyst at Pacific Crest Securities in Portland, Oregon.
He has an “outperform” rating on the stock and he doesn’t own it.
“In their prior incarnations, when there was a collapse of DRAM prices they would lose money pretty quickly,” he said.
Micron makes dynamic random access memory (DRAM) chips that provide the main memory in PCs. The average selling price of those chips fell 23 percent in the first quarter from the prior period.
The company also makes Nand flash memory chips, used in digital cameras and portable devices such as the iPhone and iPad.
Shipments of those products rose 20 percent, while prices fell 15 percent, Micron said.
Micron fell 2.4 percent to US$8.08 in extended trading after rising US$0.14 to US$8.28 at 4pm New York time on the NASDAQ Stock Market. The shares have fallen 22 percent this year.
Micron had reported an annual profit in only four of the past 10 years.
The memory industry suffers from unpredictable swings in demand, making it hard to adjust production levels quickly enough. The company goes head-to-head with South Korea’s Samsung Electronics Co, the world’s second-largest chipmaker behind Intel Corp.