Micron Electronics' Third-Quarter Profit Beats Expectations
Bloomberg News
June 15, 1998, 2:23 p.m. PT
Micron Electronics' Third-Quarter Profit Beats Expectations
Nampa, Idaho, June 15 (Bloomberg) -- Micron Electronics
Inc.'s fiscal third-quarter profit beat expectations as the
personal-computer maker's new president succeeded in cutting
costs to keep up with rapidly falling prices.
Net income in the quarter ended May 28 fell 70 percent to
$5.93 million, or 6 cents a diluted share, from $19.7 million, or
20 cents, a year earlier. Sales fell 33 percent to $340.8 million
from $511.4 million at the Nampa, Idaho-based company.
Though earnings fell, they exceeded analysts' expectations,
showing that President Joel Kocher has been able to cut costs and
make money even as PC prices tumble. Kocher came to Micron from
Dell Computer Corp., where he was a sales executive, in January.
''I'm impressed,'' said Kimball Brown, an analyst at
Dataquest, a San Jose, California-based market-research firm.
''Doing this now is impressive,'' given that PC prices are
falling rapidly because of a glut of machines at retailers, he
said.
Analysts expected Micron Electronics to earn 3 cents a
share, according to the average of estimates gathered by IBES
International Inc.
Micron's gross margin -- the percentage of revenue left
after manufacturing costs are subtracted -- widened to 19.2
percent in the quarter from 15.6 percent a year ago.
Micron Electronics is majority owned by Micron Technology
Inc., a maker of memory chips used in personal computers and
other electronics. Micron Technology, based in Boise, Idaho, is
scheduled to report earnings Thursday. |
