MEMORY MAKER Micron reported another quarter of steep losses, bringing its 2012 fiscal year to a close with a $1bn loss.
Micron is in the midst of trying to buy bankrupt Japanese DRAM manufacturer Elpida for $2.5bn, however the firm reported fourth quarter earnings that showed it wasn't in particularly good health either. The company reported revenues of $1.9bn, a drop of eight percent from a year previously, while it racked up a quarterly loss of $243m, close to double the same quarter loss it posted in 2011.
While Micron's revenues and losses are worrying, the firm has more than enough cash and assets to buy Elpida. The firm could well argue that Elpida will give it the economies of scale needed to compete with Samsung and Hynix in order to turn its financial performance around.
Micron CEO Mark Durcan said, "In 2012, despite difficult market conditions and lower average selling prices, we continued to execute on our technology and manufacturing roadmaps and moved our products increasingly into premium segments. Our focus throughout 2013 is to drive additional cost reductions and advance our leading-edge memory technology to achieve increased manufacturing efficiencies."
Should Elpida's shareholders give the green light to Micron to go forware with its acquisition, it will make the firm the second largest DRAM manufacturer, ahead of Hynix. Whether Elpida can use that size to help the industry increase DRAM prices and its profitability still remains to be seen. µ