Transforming How the World
Uses Information

For nearly 40 years, we have been instrumental to the world's most significant technology advancements, delivering optimized memory and storage systems for a broad range of applications. Our team is transforming how the world uses information delivering solutions for the world's toughest computing and storage challenges.

Press Releases

Sep 20, 2018
Micron Technology, Inc., Reports Results for the Fourth Quarter and Full Year of Fiscal 2018

BOISE, Idaho, Sept. 20, 2018 (GLOBE NEWSWIRE) -- Micron Technology, Inc., (NASDAQ: MU) today announced results of operations for its fourth quarter and full year of fiscal 2018, which ended August 30, 2018.

Fiscal Q4 2018 highlights

  • Revenues of $8.44 billion, up 38 percent compared with the same period last year
  • GAAP net income of $4.33 billion, or $3.56 per diluted share
  • Non-GAAP net income of $4.31 billion, or $3.53 per diluted share
  • Operating cash flow of $5.16 billion, compared with $3.20 billion for the same period last year

Fiscal 2018 highlights

  • Revenues of $30.39 billion, up 50 percent compared with the prior fiscal year
  • GAAP net income of $14.14 billion, or $11.51 per diluted share
  • Non-GAAP net income of $14.70 billion, or $11.95 per diluted share
  • Operating cash flow of $17.40 billion, compared with $8.15 billion for the prior fiscal year

"Micron delivered an exceptional fourth quarter and capped record fiscal year results by becoming the second largest semiconductor company in the U.S.," said Sanjay Mehrotra, President and CEO of Micron Technology. "In the fourth quarter, we set revenue records across all our major markets, from automotive and industrial to mobile and cloud datacenters. The secular and diversified growth drivers in our industry combined with accelerating pace of transformation of the new Micron form a tremendous catalyst for us to create enduring value for our customers and investors in 2019 and the years ahead."

 
Quarterly Financial Results
(in millions, except per share amounts) GAAP (1)   Non-GAAP (2)
FQ4-18 FQ3-18 FQ4-17   FQ4-18 FQ3-18 FQ4-17
Revenue $ 8,440   $ 7,797   $ 6,138     $ 8,440   $ 7,797   $ 6,138  
Gross margin $ 5,151   $ 4,723   $ 3,112     $ 5,179   $ 4,750   $ 3,147  
percent of revenue   61.0%     60.6%     50.7%       61.4%     60.9%     51.3%  
Operating income $ 4,377   $ 3,953   $ 2,502     $ 4,439   $ 4,017   $ 2,546  
percent of revenue   51.9%     50.7%     40.8%       52.6%     51.5%     41.5%  
Net income attributable to Micron $ 4,325   $ 3,823   $ 2,368     $ 4,313   $ 3,898   $ 2,386  
Diluted earnings per share $ 3.56   $ 3.10   $ 1.99     $ 3.53   $ 3.15   $ 2.02  
                                       

 

Annual Financial Results
(in millions, except per share amounts) GAAP (1)   Non-GAAP (2)
FY 18 FY 17   FY 18 FY 17
Revenue     $ 30,391   $ 20,322     $ 30,391   $ 20,322  
Gross margin     $ 17,891   $ 8,436     $ 17,994   $ 8,639  
percent of revenue       58.9%     41.5%       59.2%     42.5%  
Operating income     $ 14,994   $ 5,868     $ 15,243   $ 6,232  
percent of revenue       49.3%     28.9%       50.2%     30.7%  
Net income attributable to Micron     $ 14,135   $ 5,089     $ 14,700   $ 5,648  
Diluted earnings per share     $ 11.51   $ 4.41     $ 11.95   $ 4.96  
                               

Revenues for the fourth quarter of 2018 were 8 percent higher compared to the third quarter of 2018, reflecting increased demand broadly across our products and end markets. Our overall gross margin was 61.0 percent for the fourth quarter of 2018 compared to 60.6 percent in the third quarter benefiting from strong execution across our product portfolio.

Investments in capital expenditures, net of amounts funded by partners, were $2.06 billion for the fourth quarter of 2018 and $8.20 billion for the full year of 2018, which resulted in adjusted free cash flows(3) of $3.09 billion for the fourth quarter of 2018 and $9.20 billion for the full year of 2018. We repurchased or converted $2.23 billion principal amount of our debt during the quarter and $6.96 billion for the full year of 2018, lowering our total carrying value of debt to $4.64 billion exiting the fiscal year. We ended the fourth quarter in a record net cash position of $2.72 billion with cash, marketable investments, and restricted cash of $7.36 billion.

We will host a conference call on Thursday, September 20, 2018 at 2:30 p.m. MT to discuss our financial results. The call, audio, and slides will be available online at investors.micron.com. A webcast replay will be available on our website until September 20, 2019. A taped audio replay of the conference call will also be available at 1-404-537-3406 or 1-855-859-2056 (conference number: 5685754) beginning at 5:30 p.m. MT, Thursday, September 20, 2018 and continuing through Thursday, September 27, 2018. For Investor Relations and other company updates, follow @MicronTech on Twitter at twitter.com/MicronTech.

We are an industry leader in innovative memory and storage solutions. Through our global brands — Micron®, Crucial® and Ballistix® — our broad portfolio of high-performance memory and storage technologies, including DRAM, NAND, NOR Flash and 3D XPoint™ memory, is transforming how the world uses information to enrich life. Backed by 40 years of technology leadership, our memory and storage solutions enable disruptive trends, including artificial intelligence, machine learning, and autonomous vehicles, in key market segments like cloud, data center, networking and mobile. Our common stock is traded on the NASDAQ under the MU symbol. To learn more about Micron Technology, Inc., visit micron.com.

The Micron logo and Micron symbol are trademarks of Micron Technology, Inc. All other trademarks are the property of their respective owners.

This press release contains forward-looking statements regarding the industry and our strategic position and financial results. 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, specifically 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 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 this release 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 our management excludes in analyzing our operating results and understanding trends in our earnings. Non-GAAP also includes the impact on shares used in per share calculations of our outstanding capped call transactions and from the exclusion of stock-based compensation. For a reconciliation of GAAP to non-GAAP results, see the accompanying financial tables and footnotes.
(3) Adjusted free cash flow consists of cash provided by operating activities of $5.16 billion for the fourth quarter of 2018 and $17.40 billion for the full year of 2018 less investments in capital expenditures, net of amounts funded by partners, for the respective periods.

 
MICRON TECHNOLOGY, INC.
CONSOLIDATED FINANCIAL SUMMARY
(in millions except per share amounts)
                 
    4th Qtr.   3rd Qtr.   4th Qtr.   Year Ended
    August 30,
 2018
  May 31,
 2018
  August 31,
 2017
  August 30,
 2018
  August 31,
 2017
Net sales   $ 8,440     $ 7,797     $ 6,138     $ 30,391     $ 20,322  
Cost of goods sold   3,289     3,074     3,026     12,500     11,886  
Gross margin   5,151     4,723     3,112     17,891     8,436  
Selling, general, and administrative   215     211     193     813     743  
Research and development   567     603     447     2,141     1,824  
Other operating (income) expense, net   (8 )   (44 )   (30 )   (57 )   1  
Operating income   4,377     3,953     2,502     14,994     5,868  
Interest income (expense), net   (16 )   (44 )   (132 )   (222 )   (560 )
Other non-operating income (expense), net (1)   (15 )   (193 )   (49 )   (465 )   (112 )
Income tax (provision) benefit (2)   (20 )   109     47     (168 )   (114 )
Equity in net income (loss) of equity method investees       (2 )   1     (1 )   8  
Net (income) attributable to noncontrolling interests   (1 )       (1 )   (3 )   (1 )
Net income attributable to Micron   $ 4,325     $ 3,823     $ 2,368     $ 14,135     $ 5,089  
                     
Earnings per share                    
Basic   $ 3.73     $ 3.30     $ 2.13     $ 12.27     $ 4.67  
Diluted   3.56     3.10     1.99     11.51     4.41  
                     
Number of shares used in per share calculations                    
Basic   1,159     1,159     1,109     1,152     1,089  
Diluted   1,216     1,235     1,187     1,229     1,154  
                               

 

 
CONSOLIDATED FINANCIAL SUMMARY, Continued
             
As of   August 30,
 2018
  May 31,
 2018
  August 31,
 2017
Cash and short-term investments   $ 6,802     $ 7,071     $ 5,428  
Receivables   5,478     4,912     3,759  
Inventories   3,595     3,369     3,123  
Total current assets   16,039     15,499     12,457  
Long-term marketable investments   473     487     617  
Property, plant, and equipment, net   23,672     22,705     19,431  
Restricted cash   81     119     107  
Total assets   43,376     41,845     35,336  
             
Accounts payable and accrued expenses   4,611     3,998     3,664  
Current debt (1)   859     1,454     1,262  
Total current liabilities   5,754     5,883     5,334  
Long-term debt (1)   3,777     5,890     9,872  
             
Total Micron shareholders' equity (3)   32,294     28,649     18,621  
Noncontrolling interests in subsidiaries   870     869     849  
Total equity   33,164     29,518     19,470  
                   

 

     
    Year Ended
    August 30,
 2018
  August 31,
 2017
Net cash provided by operating activities   $ 17,400     $ 8,153  
Net cash provided by (used for) investing activities   (8,216 )   (7,537 )
Net cash provided by (used for) financing activities   (7,776 )   349  
         
Depreciation and amortization   4,860     3,986  
Investments in capital expenditures   (9,085 )   (5,253 )
Acquisition of Inotera       (2,634 )
Repayments of debt   (10,194 )   (2,558 )
Proceeds from issuance of stock (3)   1,655     142  
Proceeds from issuance of debt   1,009     3,311  
             
  1. In the fourth quarter of 2018, we prepaid or repurchased debt with an aggregate principal amount of $2.00 billion and recognized non-operating losses of $9 million. In addition, we settled convertible notes with an aggregate principal amount of $228 million for cash of $1.27 billion and recognized non-operating gains of $25 million. As of August 30, 2018, $35 million of aggregate principal amount of our convertible notes had converted but will not settle until the first quarter of 2019. As a result of the unsettled conversions, the carrying value of debt increased by $132 million as of August 30, 2018 and we recognized non-operating losses of $15 million in the fourth quarter of 2018.

    In the third quarter of 2018, we prepaid debt with an aggregate principal amount of $2.08 billion and recognized non-operating losses of $42 million. In addition, we repurchased or settled convertible notes with an aggregate principal amount of $228 million for cash of $1.11 billion and recognized non-operating losses of $32 million. In the second quarter of 2018, we settled convertible notes with an aggregate principal amount of $65 million for cash of $295 million. In the first quarter of 2018, we redeemed notes with an aggregate principal amount of $2.25 billion for cash of $2.42 billion and recognized non-operating losses of $190 million.

    During 2018, Intel Corporation provided non-interest bearing convertible debt financing of $1.01 billion to IM Flash Technologies, LLC ("IMFT") pursuant to the terms of the IMFT joint venture agreement.
     
  2. On December 22, 2017, the United States enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act") which lowers the U.S. corporate income tax rate from 35% to 21% and significantly affects how income from foreign operations is taxed in the United States. As a result of our fiscal year-end, our U.S. statutory federal rate was 25.7% for 2018 (based on the 35% corporate rate through December 31, 2017 and 21% from that date through the end of fiscal year 2018) and will be 21% for subsequent years. The Tax Act imposed a one-time transition tax in 2018 on the higher of accumulated foreign income, as determined as of November 2, 2017 or December 31, 2017 (the "Repatriation Tax"); provided a U.S. federal tax exemption on foreign earnings distributed to the United States; and, beginning in 2019, creates a new minimum tax on certain foreign earnings in excess of a deemed return on tangible assets (the "Foreign Minimum Tax"). The Tax Act allows us to elect to pay any Repatriation Tax due in eight annual interest-free payments in increasing amounts beginning in December 2018.

    The Securities and Exchange Commission Staff Accounting Bulletin No. 118 allows the use of provisional amounts (reasonable estimates) if our analyses of the impacts of the Tax Act has not been completed when our financial statements are issued. The provisional amounts below were revised during 2018 and represent reasonable estimates of the effects of the Tax Act for which the analysis is not yet complete. Our income tax (provision) benefit consisted of the following:
    4th Qtr.   3rd Qtr.   4th Qtr.   Year Ended
    August 30,
 2018
  May 31,
 2018
  August 31,
 2017
  August 30,
2018
  August 31,
2017
Provisional estimate for the Repatriation Tax, net of adjustments related to uncertain tax positions   $ 83     $ 222     $     $ (1,030 )   $  
Remeasurement of deferred tax assets and liabilities reflecting the lower U.S. corporate tax rates               (133 )    
Provisional estimate for the release of the valuation allowance on the net deferred tax assets of our U.S. operations               1,337      
Utilization of and other changes in net deferred tax assets of MMJ, MMT, and MTTW   10     (35 )   106     (68 )   54  
Other income tax (provision) benefit   (113 )   (78 )   (59 )   (274 )   (168 )
    $ (20 )   $ 109     $ 47     $ (168 )   $ (114 )
                                         
  1. In October 2017, we issued 34 million shares of our common stock in a public offering for $41.00 per share for proceeds of $1.36 billion, net of underwriting fees and other offering costs.
 
MICRON TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(in millions, except per share amounts)
           
  4th Qtr.   3rd Qtr.   4th Qtr.
  August 30, 2018   May 31, 2018   August 31, 2017
  GAAP Adj Non-GAAP   GAAP Adj Non-GAAP     GAAP Adj Non-GAAP
Net sales $ 8,440   $   $ 8,440     $ 7,797   $   $ 7,797     $ 6,138   $   $ 6,138  
Cost of goods sold 3,289   (28 ) 3,261     3,074   (27 ) 3,047     3,026   (35 ) 2,991  
Gross margin 5,151   28   5,179     4,723   27   4,750     3,112   35   3,147  
percent of revenue   61.0%       61.4%       60.6%       60.9%       50.7%       51.3%  
                                   
Selling, general, and administrative 215   (13 ) 202     211   (14 ) 197     193   (22 ) 171  
Research and development 567   (14 ) 553     603   (15 ) 588     447   (14 ) 433  
Other operating (income) expense, net (8 ) (7 ) (15 )   (44 ) (8 ) (52 )   (30 ) 27   (3 )
Operating expenses 774   (34 ) 740     770   (37 ) 733     610   (9 ) 601  
Operating income (loss) 4,377   62   4,439     3,953   64   4,017     2,502   44   2,546  
percent of revenue   51.9%       52.6%         50.7%       51.5%       40.8%       41.5%  
                                   
Interest income (expense), net (16 ) 23   7     (44 ) 23   (21 )   (132 ) 32   (100 )
Other non-operating income (expense), net (15 ) 14   (1 )   (193 ) 194   1     (49 ) 49    
  4,346   99   4,445     3,716   281   3,997     2,321   125   2,446  
                       
Income tax (provision) benefit (20 ) (111 ) (131 )   109   (206 ) (97 )   47   (107 ) (60 )
Equity in net income (loss) of equity method investees         (2 )   (2 )   1     1  
Net income (loss) 4,326   (12 ) 4,314     3,823   75   3,898     2,369   18   2,387  
                       
Net income (loss) attributable to noncontrolling interests (1 )   (1 )           (1 )   (1 )
Net income (loss) attributable to Micron $ 4,325   $ (12 ) $ 4,313     $ 3,823   $ 75   $ 3,898     $ 2,368   $ 18   $ 2,386  
                       
Shares used in calculations 1,216   4   1,220     1,235   3   1,238     1,187   (6 ) 1,181  
Diluted earnings (loss) per share $ 3.56   $ (0.03 ) $ 3.53     $ 3.10   $ 0.05   $ 3.15     $ 1.99   $ 0.03   $ 2.02  
                                                           

 

       
  Year Ended   Year Ended
  August 30, 2018   August 31, 2017
  GAAP Adj Non-GAAP   GAAP Adj Non-GAAP
Net sales $ 30,391   $   $ 30,391     $ 20,322   $   $ 20,322  
Cost of goods sold 12,500   (103 ) 12,397     11,886   (203 ) 11,683  
Gross margin 17,891   103   17,994     8,436   203   8,639  
percent of revenue   58.9%       59.2%       41.5%       42.5%  
                       
Selling, general, and administrative 813   (61 ) 752     743   (88 ) 655  
Research and development 2,141   (57 ) 2,084     1,824   (55 ) 1,769  
Other operating (income) expense, net (57 ) (28 ) (85 )   1   (18 ) (17 )
Operating expenses 2,897   (146 ) 2,751     2,568   (161 ) 2,407  
Operating income (loss) 14,994   249   15,243     5,868   364   6,232  
percent of revenue   49.3%       50.2%       28.9%       30.7%  
                       
Interest income (expense), net (222 ) 101   (121 )   (560 ) 125   (435 )
Other non-operating income (expense), net (465 ) 465       (112 ) 112    
  14,307   815   15,122     5,196   601   5,797  
               
Income tax (provision) benefit (168 ) (250 ) (418 )   (114 ) (59 ) (173 )
Equity in net income (loss) of equity method investees (1 )   (1 )   8   17   25  
Net income (loss) 14,138   565   14,703     5,090   559   5,649  
               
Net income (loss) attributable to noncontrolling interests (3 )   (3 )   (1 )   (1 )
Net income (loss) attributable to Micron $ 14,135   $ 565   $ 14,700     $ 5,089   $ 559   $ 5,648  
               
Shares used in calculations 1,229   1   1,230     1,154   (14 ) 1,140  
Diluted earnings (loss) per share $ 11.51   $ 0.44   $ 11.95     $ 4.41   $ 0.55   $ 4.96  
                                       

 

 
MICRON TECHNOLOGY, INC.
NON-GAAP ADJUSTMENTS
(in millions)
               
  4th Qtr.   3rd Qtr.   4th Qtr.   Year Ended
  August 30, 2018   May 31, 2018   August 31, 2017   August 30, 2018   August 31, 2017
Non-GAAP adjustments                  
Cost of goods sold                  
Stock-based compensation $ 21     $ 20     $ 22     $ 83     $ 88  
Flow-through of Inotera inventory step up         11         107  
Other 7     7     2     20     8  
  28     27     35     103     203  
                   
Selling, general, and administrative                  
Stock-based compensation 13     14     22     61     75  
Inotera acquisition costs                 13  
  13     14     22     61     88  
                   
Research and development                  
Stock-based compensation 13     14     13     54     52  
Other 1     1     1     3     3  
  14     15     14     57     55  
                   
Other operating (income) expense, net                  
Restructure and asset impairments 7     8     (27 )   28     18  
                   
Interest income (expense), net                  
Amortization of debt discount and other costs 23     23     32     101     125  
                   
Other non-operating income (expense)                  
(Gain) loss on debt repurchases and conversions (1 )   168     37     385     100  
(Gain) loss from changes in currency exchange rates 15     24     12     75     74  
(Gain) loss from business acquisition activities                 (71 )
Other     2         5     9  
  14     194     49     465     112  
                   
Income taxes                  
Impact of U.S. income tax reform (83 )   (222 )       (174 )    
Estimated tax effects of above, including tax benefits from stock-based compensation, and non-cash changes in net deferred income taxes (28 )   16     (107 )   (76 )   (59 )
  (111 )   (206 )   (107 )   (250 )   (59 )
                   
Equity in net income (loss) of equity method investments                  
Impairment of equity method investments                 16  
Other                 1  
                  17  
  $ (12 )   $ 75     $ 18     $ 565     $ 559  
                                       

The tables above reconcile GAAP to non-GAAP results, diluted shares, and diluted earnings per share. 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 to 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 vary from numbers 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;
  • Flow-through of business acquisition-related inventory adjustments;
  • Acquisition-related costs;
  • Restructure and asset impairments;
  • Amortization of debt discount and other costs, including the accretion of non-cash interest expense associated with our convertible debt and MMJ creditor debt;
  • Gains and losses from debt repurchases and conversions;
  • Gains and losses from changes in currency exchange rates;
  • Gains and losses loss from business acquisition activities;
  • Impact of the U.S. income tax reform for provisional estimate of Repatriation Tax, release of U.S. valuation allowance, and remeasurement of net deferred taxes reflecting the lower U.S. corporate tax rates:
  • The estimated tax effects of above, including tax benefits from stock-based compensation, and non-cash changes in net deferred taxes; and
  • Impairments of equity method investments.

Our outstanding capped call transactions are anti-dilutive in GAAP earnings per share but are expected to mitigate the dilutive effect of our convertible notes. In periods with non-GAAP income attributable to Micron, non-GAAP diluted shares include the impact of the capped calls, based on the average share price for the period the capped calls are outstanding. Non-GAAP diluted shares are also adjusted for the impact of additional shares resulting from the exclusion of stock-based compensation from non-GAAP income.

Contacts:

Farhan Ahmad
Investor Relations
farhanahmad@micron.com
(408) 834-1927

David Oro
Media Relations
davidoro@micron.com
(707) 558-8585