Micron Tech Sees Strong Production Growth, Market-Share Gains
San Francisco, Feb. 3 (Bloomberg) -- Micron Technology Inc., the No. 2 maker of computer memory chips, said it expects its output, as measured in how much computing power it can produce, to rise 35 percent in the second quarter from the first quarter.
Micron's amount of bits produced -- the total number of computing units that are made -- had been expected to rise only about 25 percent. Advances in chipmaking technology are allowing Micron to make more than it expected, the company said.
Micron said it also expects to boost its number of chips sold as it capitalizes on a strike by workers at rival LG Semiconductor that has shut down the Korean company's plants for more than 10 days.
''We've stepped into the spot,'' said Kipp Bedard, head of investor relations for Boise, Idaho-based Micron, speaking at the NationsBanc Montgomery Securities technology conference in San Francisco.
Bedard also said the price for a 64-megabit memory chips is now about $10 on the spot market and $9.50 for long-term contracts.
Micron shares rose 6 7/8 to 79 1/2.
Some analysts expect Micron to return to profitability in the second quarter ending this month as computer memory-chip prices have become more stable. Montgomery analyst Jonathan Joseph is forecasting a profit, while the average estimate of analysts polled by First Call Corp. is for a loss of 5 cents a share. Estimates range from a profit of 10 cents to a loss of 20 cents.
Because prices for memory chips fall so quickly and companies are constantly cutting costs by improving manufacturing, many memory-chip makers cite bit growth as a measure of performance. Bit growth refers to the total number of computing units the company produces, as in a 16-megabit chip or a 64-megabit chip. There are 1,000 bits per megabit.
In the first quarter, bit production rose 10 percent from the fourth quarter, Bedard said.
19:09:50 02/03/1999 |
