Micron Technology Inc, the US’s largest maker of memory chips, reported sales for the fiscal first quarter that fell short of estimates on slowing demand for components of personal computers and smartphones.
Revenue in the period ended Dec. 3 declined 27 percent to US$3.35 billion, the company said in a statement released on Tuesday. Profit excluding certain items was US$0.24 a share. Analysts had projected profit of US$0.23 on sales of US$3.47 billion, according to estimates compiled by Bloomberg.
Micron’s results reflect the challenges facing chipmakers as they seek to squeeze out earnings from a commoditized memory chip business: factory output is ramping up across the industry, while demand stagnates.
PC shipments continue to slump as consumers and businesses turn to mobile devices and Web-based software, crimping orders of DRAM chips. At the same time, the smartphone business that has driven demand for NAND storage chips is showing signs of slower growth.
“You’ve had oversupply for the whole year,” Ladenburg Thalmann & Co analyst Daniel Amir said. “Those demand drivers are not there to absorb the additional capacity.”
Micron’s first-quarter net income fell to US$206 million from US$1 billion a year earlier. The company forecast fiscal second-quarter sales of US$2.9 billion to US$3.2 billion and a loss of US$0.05 to US$0.12 a share, according to a presentation posted on its Web site. Gross margin is expected to be 17.5 percent to 20 percent. Analysts had predicted profit excluding certain items of US$0.23 a share on revenue of US$3.48 billion.
The Boise, Idaho-based company is the last major US manufacturer of memory chips. It competes with South Korea’s Samsung Electronics Co and SK Hynix Inc. Together, the three companies control more than 90 percent of the market after years of losses forced other suppliers out of the business.
Micron’s management have been trying to reduce its dependence on commodity chips and into more profitable areas like memory for servers and other specialist devices. It is also making solid-state drives — replacements for hard disk drives made of chips — as a more profitable outlet for its products.
Micron shares fell as much as 6.8 percent in extended trading on Tuesday. The stock declined 1.1 percent to US$14.61 at the close in New York, leaving them down 58 percent for the year. That decline has made them the second-worst performer on the Philadelphia Stock Exchange Semiconductor Index this year.
The US company’s disappointing results also sent shares in its partner in Taiwan, Nanya Technology Corp (南亞科技), to plunge 4.44 percent to NT$49.5 yesterday in Taipei trading, falling 36.05 percent so far this year.
Earlier this month, Nanya announced the sale of its remaining 67 percent stake in joint venture Inotera Memories Inc (華亞科技) to Micron for NT$130 billion (US$3.93 billion) in a bid to boost the efficiency of its operations long term.
Additional reporting by staff writer
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the