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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Return to Sender who wrote (22530)	3/29/2005 7:39:18 PM
From: Donald Wennerstrom	Respond to of 95765

UPDATE 2-Micron posts profit, overcoming pricing weakness Tue Mar 29, 2005 06:18 PM ET By Daniel Sorid << NEW YORK, March 29 (Reuters) - Micron Technology Inc. (MU.N: Quote, Profile, Research) , the world's No. 3 maker of computer memory chips, on Tuesday reported a $118 million quarterly profit, reversing a year-earlier loss, as sales rose for the fourth consecutive quarter. With unexpectedly high volumes of chip shipments offsetting a 15 percent drop in memory chip pricing, the results topped the average Wall Street analyst estimate, driving the shares up as much as 4 percent higher in after-hours trading on Inet. Earnings rose to $118 million, or 17 cents a share, in the quarter that ended March 3, from a loss of $28.3 million, or 4 cents a share in the same period last year. Sales increased 32 percent to $1.3 billion from $991 million. The results topped Wall Street expectations of earnings of 14 cents and sales of $1.22 billion, according to a poll of analysts by Reuters Estimates. Micron said it was able to increase efficiency at its manufacturing plants during the quarter, boosting production by 28 percent from the fiscal first quarter to satisfy healthy demand from the personal computer industry. The company also said it was increasing its share of the market for standard memory chips, known as dynamic random access memory, or DRAM. Micron had slipped from the No. 2 memory chip ranking last year as it tried to diversify into new markets for image sensors and removable storage. "We're in the mode of taking DRAM market share," said Michael Sadler, Micron's vice president of worldwide sales, on a conference call with analysts. The pricing decline, however, took a toll on Micron's gross profit margins, the percentage of sales left over after accounting for production costs. Margins were 27 percent, the lowest in a year. Moreover, Micron said pricing has been weak in the first three weeks of its current quarter. The memory chip industry saw average prices for standard computer memory chips decline about 15 percent to 20 percent in the first three months of 2005, according to research firm iSuppli. Micron said its average chip sold for about $5 in the quarter. The industry's No. 1 player is South Korea's Samsung Electronics Co. Ltd. (005930.KS: Quote, Profile, Research) , followed by Hynix Semiconductor Inc. (000660.KS: Quote, Profile, Research) and Micron. Germany's Infineon Technologies AG (IFXGn.DE: Quote, Profile, Research) was the fourth-largest supplier last year. Boise-based Micron shares rose as high as $10.50 in after-hours trading on Inet from a close of $10.12 on the New York Stock Exchange. DRAM chips tend to trade like commodities, with one chip roughly equivalent to another, and industry pricing can be notoriously volatile as supply levels rise and fall. As a proportion of Micron's quarterly revenue, DRAM chips accounted for $80 of every $100 sold, the company said. Micron Chief Executive Steve Appleton has set a goal to reduce that percentage by expanding into image sensors used in mobile phones and flash memory chips that are used in removable data storage cards.>>