Micron Technology CEO Sees Pay Fall 80% as Company Loses Money
Bloomberg News
November 25, 1998, 4:05 p.m. PT
Micron Technology CEO Sees Pay Fall 80% as Company Loses Money
Boise, Idaho, Nov. 25 (Bloomberg) -- Micron Technology Inc.
Chairman and Chief Executive Steve Appleton felt the bite of
slumping memory-chip prices in the company's latest fiscal year:
The total value of his pay package fell 80 percent.
Micron, the world's No. 2 maker of dynamic random-access
memory chips, pays its top executives bonuses based on the
company's performance. Micron lost $233.7 million in the year
ended Sept. 3, compared with net income of $332.2 million in
1997. Appleton's pay fell to $666,374 from $3.3 million,
according to a company filing with the U.S. Securities and
Exchange Commission.
Micron has been losing money because of a global glut of
DRAM. Many manufacturers rushed to build plants in 1994 and 1995,
when prices were higher, creating oversupply. Analysts say it
will be tough for DRAM makers to make money in 1999 as well.
''All the way through 1999, there will be oversupply,'' said
Jim Handy, an analyst at market researcher Dataquest in San Jose,
California. Handy said he expects the DRAM industry as a whole to
lose $5 billion in 1999, down from $9 billion this year.
That would be bad news for Appleton and other Micron
executives. The biggest difference in Appleton's pay in the last
fiscal year was that his bonus totaled just $4,246, down from
$2.73 million in fiscal 1997 and $1.55 million in 1996. He also
was granted no new stock options in fiscal 1998.
Appleton, 38, is credited with running the lowest-cost
producer of DRAM in the world, which gives him an edge over
industry leader Samsung Electronics Co. of Korea and others.
Many investors are betting that Micron will start making
money again soon. Shares of the Boise, Idaho, company have risen
50 percent in three months. They rose 15/16 to 44 13/16 today.
Micron earlier this year bought Texas Instruments Inc.'s
money-losing DRAM operations for $881 million, paying for much of
the purchase with Micron stock. In October, Intel Corp., the
world's largest microprocessor maker, said it invested $500
million in Micron to assure a supply of memory chips. |
