Although Micron Technology Inc. last week posted worse-than-expected results in its third fiscal quarter, the DRAM maker is still on track to cap off the year with nearly $1 billion in capital expenditures.
Depending on market conditions, Micron plans to earmark between $1 billion and $1.5 billion for capital spending in fiscal 2003, said chairman Steve Appleton, during the company's earnings call with analysts.
Micron, Boise, Idaho, reported a $24 million net loss for its fiscal third quarter ended May 31, compared with a net loss of $30 million for the previous quarter and a $301 million net loss for the year-ago period.
Third-quarter sales were $771 million, up 19% from $646 million in the previous quarter but down from $818 million for the same period in 2001.
Quarterly sales increased due to a 44% rise in average selling prices during the preceding period, the company said. However, by the end of the third quarter-from mid-April on-Micron said prices started to decline again due to adverse market conditions.
Micron took a $26 million inventory write-down in the quarter to reflect lower prices of chips in stock. Inventory of chips on a bits basis "increased significantly" in the quarter, Micron said.
Appleton said the Manassas, Va., fab acquired from Toshiba Corp. earlier this year could be ramped up from its current 3,500 to 4,000 wafer starts a week to 16,000 to 20,000 a week, as Micron upgrades the facility. He said 300mm-wafer processing equipment is now being installed.
Whether the company makes the plant its first 300mm production fab also depends on market conditions, Appleton said. All of Micron's new chip production equipment is capable of handling either 200 or 300mm wafers, so Micron has some flexibility in its planning.
Appleton volunteered that Micron currently "has no ongoing discussions with Hynix [Semiconductor Inc.]. "We are in a neutral position with no engagement. Obviously Hynix has its own set of challenges before deciding what to do with the company."
Appleton declined to comment on Micron being subpoenaed in late June by the Justice Department as part of a grand jury antitrust investigation of the DRAM industry.