Micron posts $706 million loss on memory woes

From CNET News.com: In the quarter ended December 4, 2008, the Boise, Idaho company posted a net loss of $706 million or 91 cents per diluted share, on net sales of $1.4 billion, down 8.7 percent. Analysts surveyed by Bloomberg had forecast a loss of 45 cents a share.

The 2009 fiscal first quarter results include a $369 million write-down of memory chip products, Micron said.

The largest U.S. manufacturer of memory chips said it saw steep drops in the average selling prices for its DRAM and NAND Flash memory products, which dove 34 percent and 24 percent respectively. DRAM is used as the main memory in PCs. Flash is used for storage in digital cameras, digiital music players, and solid-state drives.

As a result, sales of memory products fell 4 percent from the previous quarter due to "significant decreases in market selling prices for the company's products," Micron said. Sales, however, measured in gigabits, increased 35 percent for DRAM and 40 percent for NAND flash memory.

Micron Chief Executive Officer Steve Appleton also addressed the global memory chip production situation in the earnings conference call. "Most of the (memory chip) companies have announced in the neighborhood of 20 percent, 30 percent," he said referring to year-end production capacity cuts. Appleton cited Hynix, the second largest memory chip manufacturer, which is cutting capacity 30 percent.

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