Micron Technology, Inc. Q3 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Overview

  • Revenue of approximately $3.8 billion, up 2% sequentially but down 57% year-over-year.
  • Gross margin improved to -16%, a 15-point increase from Q2, though still deeply negative due to pricing pressure and inventory write-downs.
  • Non-GAAP EPS came in at a loss of $1.43 (improved from a loss of $1.91 in Q2).
  • Customer inventories across most end markets (PC, smartphone) have normalized, while data center inventories are expected to normalize near the end of calendar 2023.
  • Micron’s advanced 1-beta DRAM and 232-layer NAND nodes are achieving record yields and are positioned for strong ramps into fiscal 2024.

Macroeconomic & Regulatory Context

  • China’s Cyberspace Administration (CAC) decision remains a major headwind. About 25% of Micron’s global revenue comes from China/Hong Kong customers; roughly half of that (low double-digit % of global revenue) is at risk.
  • The CAC impact will be smaller in fiscal Q4 compared to fiscal 2024’s first half but will cause increased quarter-to-quarter revenue variability.
  • The company aims to retain global DRAM and NAND market share over time and mitigate CAC impact by reallocating volume to unaffected global customers.

Business Unit Performance (Sequential)

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Operator: Thank you for standing by, and welcome to Micron's Third Quarter 2023 Financial Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program is being recorded. And now, I'd like to introduce your host for today's program, Farhan Ahmad, Vice President, Investor Relations. Please go ahead, sir. Farhan Ahmad: Thank you, and welcome to Micron Technology's fiscal third quarter 2023 financial conference call. On the call with me today are Sanjay Mehrotra, our President and CEO, and Mark Murphy, our CFO. Today's call is being webcast from our Investor Relations site at investors.micron.com, including audio and slides. In addition, the press release detailing our quarterly results has been posted on our website, along with the prepared remarks for this call. Today's discussion of financial results is presented on a non-GAAP financial basis unless otherwise specified. A reconciliation of GAAP to non-GAAP financial measures can be found on our website. We encourage you to visit our website at micron.com throughout the quarter for the most current information on the company, including information on financial conferences that we may be attending. You can also follow us on Twitter at MicronTech. As a reminder, the matters we are discussing today include forward-looking statements regarding market demand and supply, our expected results, and ot

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