Computer-memory chip manufacturer Micron Technology has posted a second straight profit after three years of losses.
Company officials said the second quarter profits are a result of strong positioning in the market, and favorable pricing.
Micron Chairman and CEO Steve Appleton said, “The company’s results are starting to reflect the combination of an improving market, strong operational performance, advanced technology and a broad product portfolio.”
The fiscal second quarter ended March 4, and had net income attributable to Micron shareholders of $365 million, or $0.39 per diluted share, on net sales of just under $2 billion. These results compare to net income of $204 million, or $0.23 per diluted share, on net sales of $1.74 billion for the first quarter of fiscal 2010 and a net loss of $763 million, or $0.99 per diluted share, on net sales of $1.0 billion for the second quarter of fiscal 2009, according to a release. Amounts and presentations for periods prior to fiscal 2010 have been recast for the effects of the adoption of new accounting standards for convertible debt and noncontrolling interests, company officials stated.
Boise-based Micron is the largest maker of computer-memory chips in the U.S.
According to reports, Micron and its competitors have recovered from a two-year industry glut, with prices rising enough to yield a wider profit margin. Speculation is that the chip fabrication industry will not be ramping up production until after the flooded market begins to ebb to normal levels.
Micron rose as much as 49 cents, or 4.7 percent, to $10.86 in extended trading after the announcement. The stock had closed at $10.37 in regular Nasdaq Stock Market trading. Micron was the second-biggest gainer in the 21-member Philadelphia Semiconductor Index last year.
Sales in the three months ended March 4 advanced to $1.96 billion. Analysts projected $1.81 billion on average.
In February, Micron Technology acquired Swiss chip competitor Numonyx Holdings B.V. in an all-stock transaction valued at about $1.27 billion, the Boise-based firm announced on Feb. 9.
Under terms of the deal, which is expected to close within three to six months, Micron will issue 140 million common shares to Numonyx, Intel Corp., STMicroelectronics N.V. and Francisco Partners.
Micron has reported an annual profit in only four of the past 10 years. The memory industry suffers from unpredictable swings in demand, making it hard to adjust production levels quickly enough. South Korea’s Samsung Electronics Co. is the world’s largest maker of computer memory.