Micron's Second Quarter Results Beat Estimates
Micron Technology beat estimates for quarterly revenue and profit on Wednesday, as a result of the demand for its memory chips used in data centers.
The chip maker's revenue fell to $5.84 billion from $7.35 billion for the same period last year.
Net income attributable to the company fell to $1.62 billion in the second quarter ended Feb. 28, from $3.31 billion, a year earlier.
"Micron continues to execute well across a range of product, operational and financial initiatives against the backdrop of a challenging market environment," said Micron Technology President and CEO Sanjay Mehrotra. "These initiatives and our focus on high-value solutions, cost competitiveness and innovation will enable us to emerge even stronger as the market environment improves."
Investments in capital expenditures, net of amounts funded by partners, were $2.45 billion for the second quarter of 2019, which resulted in adjusted free cash flow of $988 million.
Micron's results come against a slowdown in the global semiconductor industry that has been triggered by waning demand for smartphones.
Chipmakers are also reeling from a prolonged trade war between the United States and China, with Micron warning in September that U.S. tariffs on Chinese goods will weigh on its financial results for as much as a year.
Micron has been trying to invest more on its next generation chips, and to reduce production. The company said it would idle 5 percent of production for DRAM and NAND memory chips because of weaker demand and reduce its planned capital expenses in the fiscal year by about $9 billion.Micron also predicted a recovery in a memory market.
Tech research firm TrendForce in a report said it expects a only a slight decline in NAND flash chip sales in the second quarter as demand recovers from smartphones, computers and servers.