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Micron Posts Third Straight Loss on Weak Chip Prices

Thursday, 22 Mar 2012 04:37 PM

Micron Technology Inc., the largest U.S. maker of computer memory, reported a third consecutive loss after sluggish demand for personal computers dragged down chip prices.

The second-quarter net loss was $224 million, or 23 cents a share, compared with a profit of $72 million, or 7 cents, a year earlier, the Boise, Idaho-based company said today. Sales were $2.07 billion in the period, which ended March 1. Analysts had predicted a loss of 19 cents and revenue of $2.01 billion on average, according to data compiled by Bloomberg.

A glut of memory-chip production has sent prices tumbling, making it hard for Micron and its rivals to stay profitable. The picture may improve if the bankruptcy of Japan’s Elpida Memory Inc. reduces industry output, said Alex Gauna, an analyst at JMP Securities LLC in San Francisco.

“The industry is poised to get healthier, but it’s not healthy yet,” Gauna said. He recommends buying Micron shares, which he doesn’t own himself. “We’ve seen improvements, but most of the product drivers and better seasonality come in the second half of the year.”

Micron shares fell less than 1 percent to $8.71 at the close in New York. The stock has climbed 38 percent this year.

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2012-37-22
Thursday, 22 Mar 2012 04:37 PM
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