Micron Profit Tops Estimates; Sales Miss

(RTTNews) - Memory chip maker Micron Technology, Inc. (MU) said Tuesday after the markets closed that its first quarter profit rose sharply from last year, helped by higher sales, improved gross margin and the absence of a litigation settlement related charge that the company recorded last year.

The company's quarterly earnings per share, excluding items, also came in above analysts' expectations, but its quarterly sales fell short of analysts' forecast. At the same time, the company gave a downbeat revenue outlook for the current quarter.

"Micron's execution and continued favorable market conditions led to a strong first quarter with record revenues and operating cash flows," said Micron CEO Mark Durcan.

Micron shares are currently losing 4.17% in after hours trading after closing the day's regular trading session at $32.87, down 91 cents or 2.68%. The shares trade in a 52-week range of $20.89 to $36.59.

The Boise, Idaho-based company reported net income for the first quarter of $1.00 billion or $0.84 per share, compared to $358 million or $0.30 per share for the year-ago quarter.

This marks the company's seventh straight quarterly profit after a string of seven consecutive quarterly losses.

The year-ago quarter results included a $233 million litigation settlement related charge.

Excluding items, adjusted net income for the latest quarter was $1.14 billion or $0.97 per share.

On average, 27 analysts polled by Thomson Reuters expected the company to earn $0.92 per share for the first quarter. Analysts' estimates typically exclude special items.

Gross margin for the first quarter improved 35.8% from 31.7% a year earlier.

Net sales for the first quarter rose 13% to $4.57 billion from $4.04 billion in the same quarter last year. Thirty analysts had a consensus revenue estimate of $4.62 billion for the first quarter.

Looking forward, the company forecast second quarter sales of $4.1 billion to $4.3 billion. Analysts currently expect the company to post revenue of $4.53 billion for the second quarter.

In memory chip market, Micron competes with industry leader Samsung and Hynix Semiconductor among others. Micron has expanded into a new area of the memory market known as NOR with its $1.2 billion acquisition of Numonyx. The July 2013 acquisition of Elpida Memory, Inc. helped increase Micron's global market share for DRAM chips, whcih are most widely used in personal computers. Micron also supplies NAND Flash memory chips, which are used in iPods, digital cameras and other portable devices.