Chipmaker Micron's Profit Falls 59% on Weak Demand

Technology Reuters

Memory chipmaker Micron Technology Inc (MU) reported quarterly revenue and profit above estimates, sending its shares up 3.8% in after-hours trading.

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The company, which makes both dynamic random access memory (DRAM)and NAND flash memory chips, reported a 14.8%t fall in revenue to $3.60 billion in the fourth quarter, compared with a year earlier.

The results, however, beat the average analyst estimate of $3.55 billion, according to Thomson Reuters I/B/E/S.

NAND flash memory chips are widely used in smartphones, cameras and other mobile devices to store music, pictures and other data. DRAM chips are mostly used in personal computers.

The company said it expects the demand environment to stabilize and improve through calendar 2016, after previously warning in June that it expected a decline in prices of chips used in personal computers.

Micron said on Thursday net income attributable to the company fell 59% to $471 million, or 42 cents per share, in the quarter ended Sept. 3. (http://1.usa.gov/1ML4B0T)

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Excluding items, the company earned 37 cents per share, trumping analysts' estimates of 32 cents per share.

Micron is being pursued by China's state-backed Tsinghua Unigroup Ltd, according to reports.

Tsinghua, whose unit bought a 15 percent stake in Western Digital Corp (WDC) for $3.8 billion on Wednesday, has offered $23 billion for Micron, but the plan has been clouded by U.S. security concerns.

Shares of Micron, which competes with SanDisk Corp (NASDAQ: SNDK) and SK Hynix Inc <000660.KS>, closed at $14.77 on the Nasdaq on Thursday.

(Reporting by Anya George Tharakan in Bengaluru)