Micron Technology, Inc. Reports Results for the Third Quarter of Fiscal 2024
Micron Technology (Nasdaq: MU) has released its results for the third quarter of fiscal 2024, ending May 30, 2024. The company reported a significant revenue increase of $6.81 billion, up from $5.82 billion in the previous quarter and $3.75 billion in the same period last year.
GAAP net income stood at $332 million, or $0.30 per diluted share, while non-GAAP net income was $702 million, or $0.62 per diluted share. Operating cash flow reached $2.48 billion, a substantial rise from $1.22 billion in the prior quarter and $24 million the previous year.
Driven by robust AI demand, Micron experienced a 50% sequential growth in data center revenue. The company's data center SSD revenue achieved a record high. Investments in capital expenditures were $2.06 billion, resulting in adjusted free cash flows of $425 million. Micron ended the quarter with $9.22 billion in cash and marketable investments.
Looking ahead, Micron provided guidance for the fourth quarter of 2024, forecasting revenue at $7.60 billion ± $200 million and a gross margin of 33.5% ± 1.0% on a GAAP basis.
- Revenue increased to $6.81 billion from $5.82 billion in the previous quarter.
- GAAP net income of $332 million, or $0.30 per diluted share.
- Non-GAAP net income of $702 million, or $0.62 per diluted share.
- Operating cash flow surged to $2.48 billion.
- 50% sequential growth in data center revenue.
- Record high data center SSD revenue.
- Guidance for Q4 2024 predicts revenue of $7.60 billion ± $200 million.
- Operating expenses increased to $1.113 billion from $888 million in the previous quarter.
- Net income decreased from $793 million in the prior quarter to $332 million.
Insights
Micron Technology's Q3 2024 results highlight a significant improvement with revenue totaling $6.81 billion, up from $5.82 billion in the previous quarter and $3.75 billion in the same period last year. This represents a
The growth is driven by a 50% sequential increase in data center revenue, primarily due to rising AI demand. Such a surge demonstrates Micron’s effective positioning in high-margin segments like High Bandwidth Memory (HBM) and data center SSDs.
Investors will also be interested in the
However, it's essential to consider potential headwinds. The reliance on AI demand could pose risks if market conditions change. While the short-term outlook is promising, the long-term success will hinge on sustained demand and competitive positioning.
The Q3 results reveal Micron's strategic focus on AI-driven products yielding substantial gains. The record high data center revenue mix underscores the company's strong presence in a rapidly expanding market. The emphasis on high-margin products like HBM and data center SSDs aligns with current industry trends favoring performance-intensive applications.
The projected revenue for Q4 2024 at
However, the competitive landscape in the semiconductor industry remains intense. Companies like Samsung and SK Hynix are also vying for market share in the lucrative AI sector. Micron's ability to maintain its edge through innovation and strategic partnerships will be crucial.
AI demand drives
BOISE, Idaho, June 26, 2024 (GLOBE NEWSWIRE) -- Micron Technology, Inc. (Nasdaq: MU) today announced results for its third quarter of fiscal 2024, which ended May 30, 2024.
Fiscal Q3 2024 highlights
- Revenue of
$6.81 billion versus$5.82 billion for the prior quarter and$3.75 billion for the same period last year
- GAAP net income of
$332 million , or$0.30 per diluted share - Non-GAAP net income of
$702 million , or$0.62 per diluted share - Operating cash flow of
$2.48 billion versus$1.22 billion for the prior quarter and$24 million for the same period last year
“Robust AI demand and strong execution enabled Micron to drive
| Quarterly Financial Results | |||||||||||||||||||
| (in millions, except per share amounts) | GAAP(1) | Non-GAAP(2) | |||||||||||||||||
| FQ3-24 | FQ2-24 | FQ3-23 | FQ3-24 | FQ2-24 | FQ3-23 | ||||||||||||||
| Revenue | $ | 6,811 | $ | 5,824 | $ | 3,752 | $ | 6,811 | $ | 5,824 | $ | 3,752 | |||||||
| Gross margin | 1,832 | 1,079 | (668 | ) | 1,917 | 1,163 | (603 | ) | |||||||||||
| percent of revenue | 26.9 | % | 18.5 | % | (17.8 | %) | 28.1 | % | 20.0 | % | (16.1 | %) | |||||||
| Operating expenses | 1,113 | 888 | 1,093 | 976 | 959 | 866 | |||||||||||||
| Operating income (loss) | 719 | 191 | (1,761 | ) | 941 | 204 | (1,469 | ) | |||||||||||
| percent of revenue | 10.6 | % | 3.3 | % | (46.9 | %) | 13.8 | % | 3.5 | % | (39.2 | %) | |||||||
| Net income (loss) | 332 | 793 | (1,896 | ) | 702 | 476 | (1,565 | ) | |||||||||||
| Diluted earnings (loss) per share | 0.30 | 0.71 | (1.73 | ) | 0.62 | 0.42 | (1.43 | ) | |||||||||||
Investments in capital expenditures, net(2) were
Business Outlook
The following table presents Micron’s guidance for the fourth quarter of 2024:
| FQ4-24 | GAAP(1) Outlook | Non-GAAP(2) Outlook |
| Revenue | ||
| Gross margin | ||
| Operating expenses | ||
| Diluted earnings per share | ||
Further information regarding Micron’s business outlook is included in the prepared remarks and slides, which have been posted at investors.micron.com.
Investor Webcast
Micron will host a conference call on Wednesday, June 26, 2024 at 2:30 p.m. Mountain Time to discuss its third quarter financial results and provide forward-looking guidance for its fourth quarter. A live webcast of the call will be available online at investors.micron.com. A webcast replay will be available for one year after the call. For Investor Relations and other company updates, follow us on X @MicronTech.
About Micron Technology, Inc.
We are an industry leader in innovative memory and storage solutions transforming how the world uses information to enrich life for all. With a relentless focus on our customers, technology leadership, and manufacturing and operational excellence, Micron delivers a rich portfolio of high-performance DRAM, NAND, and NOR memory and storage products through our Micron® and Crucial® brands. Every day, the innovations that our people create fuel the data economy, enabling advances in artificial intelligence (AI) and compute-intensive applications that unleash opportunities — from the data center to the intelligent edge and across the client and mobile user experience. To learn more about Micron Technology, Inc. (Nasdaq: MU), visit micron.com.
© 2024 Micron Technology, Inc. All rights reserved. Micron, the Micron logo, and all other Micron trademarks are the property of Micron Technology, Inc. All other trademarks are the property of their respective owners.
Forward-Looking Statements
This press release contains forward-looking statements regarding our industry, our strategic position, technology trends and developments including artificial intelligence, market demand, and our financial and operating results, including our guidance for the fourth quarter of 2024. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially. Please refer to the documents we file with the Securities and Exchange Commission, including our most recent Form 10-K and Form 10-Q. These documents contain and identify important factors that could cause our actual results to differ materially from those contained in these forward-looking statements. These certain factors can be found at investors.micron.com/risk-factor. 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 to conform these statements to actual results.
| (1) | GAAP represents U.S. Generally Accepted Accounting Principles. |
| (2) | Non-GAAP represents GAAP excluding the impact of certain activities, which management excludes in analyzing our operating results and understanding trends in our earnings, adjusted free cash flow, and business outlook. Further information regarding Micron’s use of non-GAAP measures and reconciliations between GAAP and non-GAAP measures are included within this press release. |
| MICRON TECHNOLOGY, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share amounts) (Unaudited) | |||||||||||||||
| 3rd Qtr. | 2nd Qtr. | 3rd Qtr. | Nine months ended | ||||||||||||
| May 30, 2024 | February 29, 2024 | June 1, 2023 | May 30, 2024 | June 1, 2023 | |||||||||||
| Revenue | $ | 6,811 | $ | 5,824 | $ | 3,752 | $ | 17,361 | $ | 11,530 | |||||
| Cost of goods sold | 4,979 | 4,745 | 4,420 | 14,485 | 12,511 | ||||||||||
| Gross margin | 1,832 | 1,079 | (668 | ) | 2,876 | (981 | ) | ||||||||
| Research and development | 850 | 832 | 758 | 2,527 | 2,395 | ||||||||||
| Selling, general, and administrative | 291 | 280 | 219 | 834 | 701 | ||||||||||
| Restructure and asset impairments | — | — | 68 | — | 167 | ||||||||||
| Other operating (income) expense, net | (28 | ) | (224 | ) | 48 | (267 | ) | 29 | |||||||
| Operating income (loss) | 719 | 191 | (1,761 | ) | (218 | ) | (4,273 | ) | |||||||
| Interest income | 136 | 130 | 127 | 398 | 334 | ||||||||||
| Interest expense | (150 | ) | (144 | ) | (119 | ) | (426 | ) | (259 | ) | |||||
| Other non-operating income (expense), net | 10 | (7 | ) | — | (24 | ) | (2 | ) | |||||||
| 715 | 170 | (1,753 | ) | (270 | ) | (4,200 | ) | ||||||||
| Income tax (provision) benefit | (377 | ) | 622 | (139 | ) | 172 | (201 | ) | |||||||
| Equity in net income (loss) of equity method investees | (6 | ) | 1 | (4 | ) | (11 | ) | (2 | ) | ||||||
| Net income (loss) | $ | 332 | $ | 793 | $ | (1,896 | ) | $ | (109 | ) | $ | (4,403 | ) | ||
| Earnings (loss) per share | |||||||||||||||
| Basic | $ | 0.30 | $ | 0.72 | $ | (1.73 | ) | $ | (0.10 | ) | $ | (4.03 | ) | ||
| Diluted | 0.30 | 0.71 | (1.73 | ) | (0.10 | ) | (4.03 | ) | |||||||
| Number of shares used in per share calculations | |||||||||||||||
| Basic | 1,107 | 1,104 | 1,094 | 1,104 | 1,092 | ||||||||||
| Diluted | 1,123 | 1,114 | 1,094 | 1,104 | 1,092 | ||||||||||
| MICRON TECHNOLOGY, INC. CONSOLIDATED BALANCE SHEETS (In millions) (Unaudited) | |||||||||
| As of | May 30, 2024 | February 29, 2024 | August 31, 2023 | ||||||
| Assets | |||||||||
| Cash and equivalents | $ | 7,594 | $ | 8,016 | $ | 8,577 | |||
| Short-term investments | 785 | 990 | 1,017 | ||||||
| Receivables | 5,131 | 4,296 | 2,443 | ||||||
| Inventories | 8,512 | 8,443 | 8,387 | ||||||
| Other current assets | 1,297 | 1,690 | 820 | ||||||
| Total current assets | 23,319 | 23,435 | 21,244 | ||||||
| Long-term marketable investments | 775 | 627 | 844 | ||||||
| Property, plant, and equipment | 37,926 | 37,587 | 37,928 | ||||||
| Operating lease right-of-use assets | 660 | 642 | 666 | ||||||
| Intangible assets | 413 | 414 | 404 | ||||||
| Deferred tax assets | 597 | 664 | 756 | ||||||
| Goodwill | 1,150 | 1,150 | 1,150 | ||||||
| Other noncurrent assets | 1,415 | 1,199 | 1,262 | ||||||
| Total assets | $ | 66,255 | $ | 65,718 | $ | 64,254 | |||
| Liabilities and equity | |||||||||
| Accounts payable and accrued expenses | $ | 5,145 | $ | 4,680 | $ | 3,958 | |||
| Current debt | 398 | 344 | 278 | ||||||
| Other current liabilities | 1,297 | 1,235 | 529 | ||||||
| Total current liabilities | 6,840 | 6,259 | 4,765 | ||||||
| Long-term debt | 12,860 | 13,378 | 13,052 | ||||||
| Noncurrent operating lease liabilities | 609 | 593 | 603 | ||||||
| Noncurrent unearned government incentives | 672 | 662 | 727 | ||||||
| Other noncurrent liabilities | 1,049 | 956 | 987 | ||||||
| Total liabilities | 22,030 | 21,848 | 20,134 | ||||||
| Commitments and contingencies | |||||||||
| Shareholders’ equity | |||||||||
| Common stock | 125 | 125 | 124 | ||||||
| Additional capital | 11,794 | 11,564 | 11,036 | ||||||
| Retained earnings | 40,169 | 39,997 | 40,824 | ||||||
| Treasury stock | (7,552 | ) | (7,552 | ) | (7,552 | ) | |||
| Accumulated other comprehensive income (loss) | (311 | ) | (264 | ) | (312 | ) | |||
| Total equity | 44,225 | 43,870 | 44,120 | ||||||
| Total liabilities and equity | $ | 66,255 | $ | 65,718 | $ | 64,254 | |||
| MICRON TECHNOLOGY, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) | ||||||
| Nine months ended | May 30, 2024 | June 1, 2023 | ||||
| Cash flows from operating activities | ||||||
| Net income (loss) | $ | (109 | ) | $ | (4,403 | ) |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||
| Depreciation expense and amortization of intangible assets | 5,794 | 5,819 | ||||
| Stock-based compensation | 620 | 448 | ||||
| Provision to write-down inventories to net realizable value | — | 1,831 | ||||
| Change in operating assets and liabilities: | ||||||
| Receivables | (2,562 | ) | 2,728 | |||
| Inventories | (125 | ) | (3,406 | ) | ||
| Other current assets | (435 | ) | (35 | ) | ||
| Accounts payable and accrued expenses | 846 | (1,113 | ) | |||
| Other current liabilities | 769 | (677 | ) | |||
| Other | 304 | 118 | ||||
| Net cash provided by operating activities | 5,102 | 1,310 | ||||
| Cash flows from investing activities | ||||||
| Expenditures for property, plant, and equipment | (5,266 | ) | (6,215 | ) | ||
| Purchases of available-for-sale securities | (1,110 | ) | (496 | ) | ||
| Proceeds from maturities and sales of available-for-sale securities | 1,433 | 1,192 | ||||
| Proceeds from government incentives | 267 | 248 | ||||
| Other | (35 | ) | (90 | ) | ||
| Net cash provided by (used for) investing activities | (4,711 | ) | (5,361 | ) | ||
| Cash flows from financing activities | ||||||
| Repayments of debt | (1,816 | ) | (706 | ) | ||
| Payments of dividends to shareholders | (384 | ) | (378 | ) | ||
| Payments on equipment purchase contracts | (127 | ) | (112 | ) | ||
| Repurchases of common stock - repurchase program | — | (425 | ) | |||
| Proceeds from issuance of debt | 999 | 6,716 | ||||
| Other | (40 | ) | — | |||
| Net cash provided by (used for) financing activities | (1,368 | ) | 5,095 | |||
| Effect of changes in currency exchange rates on cash, cash equivalents, and restricted cash | (15 | ) | (13 | ) | ||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | (992 | ) | 1,031 | |||
| Cash, cash equivalents, and restricted cash at beginning of period | 8,656 | 8,339 | ||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 7,664 | $ | 9,370 | ||
| MICRON TECHNOLOGY, INC. NOTES (Unaudited) (All tabular amounts in millions) |
Inventories
In 2023, we recorded charges of
| 3rd Qtr. | 2nd Qtr. | 3rd Qtr. | Nine months ended | |||||||||
| May 30, 2024 | February 29, 2024 | June 1, 2023 | May 30, 2024 | June 1, 2023 | ||||||||
| Provision to write down inventory to NRV | $ | — | $ | — | $ | (401 | ) | $ | — | $ | (1,831 | ) |
| Lower costs from sale of inventory written down in prior periods | — | 382 | 281 | 987 | 281 | |||||||
| $ | — | $ | 382 | $ | (120 | ) | $ | 987 | $ | (1,550 | ) | |
Income Tax
In the first quarter of 2024, our tax expense was based on actual results for jurisdictions where small changes in our projected pre-tax income would have caused significant changes in the estimated annual effective tax rate. With our improved fiscal 2024 outlook, we were able to estimate a more reliable annual effective tax rate and have reverted to a global annual effective tax rate method for all jurisdictions beginning in the second quarter of 2024.
| MICRON TECHNOLOGY, INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (In millions, except per share amounts) | |||||||||
| 3rd Qtr. | 2nd Qtr. | 3rd Qtr. | |||||||
| May 30, 2024 | February 29, 2024 | June 1, 2023 | |||||||
| GAAP gross margin | $ | 1,832 | $ | 1,079 | $ | (668 | ) | ||
| Stock-based compensation | 80 | 80 | 60 | ||||||
| Other | 5 | 4 | 5 | ||||||
| Non-GAAP gross margin | $ | 1,917 | $ | 1,163 | $ | (603 | ) | ||
| GAAP operating expenses | $ | 1,113 | $ | 888 | $ | 1,093 | |||
| Stock-based compensation | (137 | ) | (129 | ) | (91 | ) | |||
| Restructure and asset impairments | — | — | (68 | ) | |||||
| Patent cross-license agreement gain | — | 200 | — | ||||||
| Litigation settlement | — | — | (68 | ) | |||||
| Non-GAAP operating expenses | $ | 976 | $ | 959 | $ | 866 | |||
| GAAP operating income (loss) | $ | 719 | $ | 191 | $ | (1,761 | ) | ||
| Stock-based compensation | 217 | 209 | 151 | ||||||
| Restructure and asset impairments | — | — | 68 | ||||||
| Patent cross-license agreement gain | — | (200 | ) | — | |||||
| Litigation settlement | — | — | 68 | ||||||
| Other | 5 | 4 | 5 | ||||||
| Non-GAAP operating income (loss) | $ | 941 | $ | 204 | $ | (1,469 | ) | ||
| GAAP net income (loss) | $ | 332 | $ | 793 | $ | (1,896 | ) | ||
| Stock-based compensation | 217 | 209 | 151 | ||||||
| Restructure and asset impairments | — | — | 68 | ||||||
| Patent cross-license agreement gain | — | (200 | ) | — | |||||
| Litigation settlement | — | — | 68 | ||||||
| Other | 3 | 2 | 7 | ||||||
| Estimated tax effects of above and other tax adjustments(1) | 150 | (328 | ) | 37 | |||||
| Non-GAAP net income (loss) | $ | 702 | $ | 476 | $ | (1,565 | ) | ||
| GAAP weighted-average common shares outstanding - Diluted | 1,123 | 1,114 | 1,094 | ||||||
| Adjustment for stock-based compensation | 13 | 20 | — | ||||||
| Non-GAAP weighted-average common shares outstanding - Diluted | 1,136 | 1,134 | 1,094 | ||||||
| GAAP diluted earnings (loss) per share | $ | 0.30 | $ | 0.71 | $ | (1.73 | ) | ||
| Effects of the above adjustments | 0.32 | (0.29 | ) | 0.30 | |||||
| Non-GAAP diluted earnings (loss) per share | $ | 0.62 | $ | 0.42 | $ | (1.43 | ) | ||
| (1) | The second fiscal quarter tax benefit arose from applying our estimated annual effective tax rate to our year-to-date results. A portion of this benefit is included in our non-GAAP net income, with a larger benefit in our GAAP net income. The divergence between the GAAP and non-GAAP tax relates to the difference in our GAAP and non-GAAP estimated annual effective tax rates, which are computed separately. |
| RECONCILIATION OF GAAP TO NON-GAAP MEASURES, Continued | |||||||||
| 3rd Qtr. | 2nd Qtr. | 3rd Qtr. | |||||||
| May 30, 2024 | February 29, 2024 | June 1, 2023 | |||||||
| GAAP net cash provided by operating activities | $ | 2,482 | $ | 1,219 | $ | 24 | |||
| Expenditures for property, plant, and equipment | (2,086 | ) | (1,384 | ) | (1,561 | ) | |||
| Payments on equipment purchase contracts | (45 | ) | (26 | ) | (36 | ) | |||
| Proceeds from sales of property, plant, and equipment | 41 | 13 | 34 | ||||||
| Proceeds from government incentives | 33 | 149 | 184 | ||||||
| Investments in capital expenditures, net | (2,057 | ) | (1,248 | ) | (1,379 | ) | |||
| Adjusted free cash flow | $ | 425 | $ | (29 | ) | $ | (1,355 | ) | |
The tables above reconcile GAAP to non-GAAP measures of gross margin, operating expenses, operating income (loss), net income (loss), diluted shares, diluted earnings (loss) per share, and adjusted free cash flow. The non-GAAP adjustments above may or may not be infrequent or nonrecurring in nature, but are a result of periodic or non-core operating activities. We believe this non-GAAP information is helpful in understanding trends and in analyzing our operating results and earnings. We are providing this information to investors to assist in performing analysis of our operating results. When evaluating performance and making decisions on how to allocate our resources, management uses this non-GAAP information and believes investors should have access to similar data when making their investment decisions. We believe these non-GAAP financial measures increase transparency by providing investors with useful supplemental information about the financial performance of our business, enabling enhanced comparison of our operating results between periods and with peer companies. The presentation of these adjusted amounts varies from amounts presented in accordance with U.S. GAAP and therefore may not be comparable to amounts reported by other companies. Our management excludes the following items in analyzing our operating results and understanding trends in our earnings:
- Stock-based compensation;
- Gains and losses from settlements;
- Restructure and asset impairments; and
- The estimated tax effects of above, non-cash changes in net deferred income taxes, assessments of tax exposures, certain tax matters related to prior fiscal periods, and significant changes in tax law.
Non-GAAP diluted shares are adjusted for the impact of additional shares resulting from the exclusion of stock-based compensation from non-GAAP income (loss).
| MICRON TECHNOLOGY, INC. RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK | ||||||||
| FQ4-24 | GAAP Outlook | Adjustments | Non-GAAP Outlook | |||||
| Revenue | — | |||||||
| Gross margin | A | |||||||
| Operating expenses | B | |||||||
| Diluted earnings per share(1) | A, B, C | |||||||
| Non-GAAP Adjustments (in millions) | ||||||||
| A | Stock-based compensation – cost of goods sold | $ | 84 | |||||
| A | Other – cost of goods sold | 4 | ||||||
| B | Stock-based compensation – research and development | 77 | ||||||
| B | Stock-based compensation – sales, general, and administrative | 48 | ||||||
| C | Tax effects of the above items and other tax adjustments | 315 | ||||||
| $ | 528 | |||||||
| (1) | GAAP earnings per share based on approximately 1.12 billion diluted shares and non-GAAP earnings per share based on approximately 1.14 billion diluted shares. |
The tables above reconcile our GAAP to non-GAAP guidance based on the current outlook. The guidance does not incorporate the impact of any potential business combinations, divestitures, additional restructuring activities, balance sheet valuation adjustments, strategic investments, financing transactions, and other significant transactions. The timing and impact of such items are dependent on future events that may be uncertain or outside of our control.
FAQ
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