MADRID, 10 (EUROPA PRESS)
Samsung’s announcement last Friday to cut its production of memory chips has lifted the shares of its competitors on the prospect of reducing excess inventories that are plunging prices in the industry.
In this way, Micron’s shares rose 7.65% on Wall Street this Monday at mid-session, while Western Digital Corp has done the same with 8.42%.
Despite the economic reactivation due to the pandemic, the demand for electronic products fell, which, together with the macroeconomic environment and high inflation, has affected manufacturers. Samsung has so far resisted cutting production to capture the market from its rivals.
In fact, Micron announced layoffs in December and a few weeks ago announced losses in the second quarter of its fiscal year 2023, ended on March 2, of 2,312 million dollars (2,130 million euros), compared to net profit of 2,263 million dollars (2,085 million euros) recorded in the same period of the preceding fiscal year.
Likewise, the multinational’s turnover experienced a 52.6% drop in the quarter compared to the same period of the previous year, up to 3,693 million dollars (3,403 million euros).
In terms of expenses, the costs of products marketed, R&D, sales, general, administrative and restructuring and depreciation rose 16.1% to stand at 6,004 million dollars (5,532 million euros).
“Customer inventories are improving, and we expect gradual improvements in the industry’s supply-demand balance,” Micron CEO Sanjay Mehrotra said. “We pin our hopes on long-term demand and invest prudently to safeguard our technological competitiveness and product portfolio,” he added.
However, the board of directors has announced a quarterly dividend of 0.115 dollars (0.11 euros) per share that will be paid in cash on April 25 to those reference shareholders at the close of trading on April 10.
Facing the third quarter, Micron expects, in the central scenario, to have revenues of 3,700 million dollars (3,409 million euros), with a possible deviation of 200 million dollars (184.3 million euros) both upwards and down. In addition, diluted losses per share of $1.79 (1.65 euros) will be recorded.
If the collapse of new orders is consummated, ‘Bloomberg’ believes that the company will be bound to lose 3,000 million dollars (2,764 million euros) in 2023, its largest deficit since 1984, the year in which Micron began trading on the stock market.
Micron already announced at the end of December that it would carry out a workforce adjustment that would affect 10% of its around 48,000 employees as part of the restructuring of the microprocessor manufacturer’s activity in response to “challenging industry conditions”. .
Under this plan, Micron expected to reduce its workforce through a combination of voluntary redundancies and staff cuts. The multinational expected to incur extraordinary charges of at least 30 million dollars (27.6 million euros) in the second quarter of its 2023 fiscal year.
However, a few months earlier, in August 2022, Micron had announced an investment of 40,000 million dollars (36,858 million euros) until the end of the decade to boost the manufacture of memories in the United States, which would precisely make it possible to creating around 40,000 jobs.