Micron Technology, Inc. · NASDAQ:MU
Micron Technology — Investor Presentation (May 2020)
27 slides from Micron Technology's investor presentation, May 12, 2020
Slide 1: Investor Update
Exhibit 99.1 Investor Update Manish Bhatia EVP, Global Operations May 12, 2020 ©2020 Micron Technology, Inc. All rights reserved. Information, products, and/or specifications are subject to change without notice. All information is provided on an “AS IS” basis without warranties of any kind. Stateme
Slide 2: Safe Harbor Statement
Safe Harbor Statement During the course of this meeting, we may make projections or other forward-looking statements regarding future events or the future financial performance of the Company and the industry. We wish to caution you that such statements are predictions and that actual events or resu
Slide 3: Manish Bhatia, Executive Vice President Global Operations
Manish Bhatia Executive Vice President Global Operations 3
Slide 4: Agenda
Agenda Market strategy Operational excellence Results 4
Slide 5: Market
Market % r Strategy - } . / i i i } me & ‘4 . ? 4 y
Slide 6: Our markets are strong; our position is getting stronger
Our markets are strong Our position is getting stronger Product Strong secular TAM growth leadership & Supply demand outpacing cost discipline industry competitiveness 6
Slide 7: Growth of data is driving healthy demand for memory and storage
Memory & Storage Data Economy Industry Revenue Growth of data is driving healthy 2000-2007 $38B PC / Internet Era 2008-2016 $62B Mobile Era demand for 2017-2019 $134B Data Economy memory and Future Opportunity storage Memory & storage revenue bars represent average annual total DRAM, NAND, NOR and S
Slide 8: DRAM & NAND revenue as % of Semiconductor TAM
DRAM & NAND revenue as % of Semiconductor TAM (Last three years moving average) DRAM & NAND 30% Revenue Growing faster than the semiconductor industry 20% 10% 2002 2006 2010 2014 2018 Sources: SEMI Rev (WSTS), Memory and NAND: Gartner and SEMI (WSTS) 8
Slide 9: Product & Solutions Leadership
Product & Solutions Leadership High-Value NAND % of Total NAND Bits Only company with DRAM, NAND & 3DXP DRAM ~80% ~70% ▪ Most power efficient Low Power DRAM ▪ High-quality high-density server modules >50% NAND ▪ Broadening SSD portfolio ▪ Growing managed NAND/MCP share 3DXP ▪ World’s fastest SSD FY-
Slide 10: Industry-leading technology nodes and rate of cost reduction
>1.5x Industry-leading technology nodes Industry Faster yield ramps Rate of Cost Reduction Increased economies of scale In both DRAM and NAND 2016 to 2019 Faster transition of production mix to advanced nodes 10
Slide 11: Supply Discipline
Supply Discipline Micron supply growth in-line with market demand DRAM NAND CY19 to CY23 CAGR CY19 to CY23 CAGR Industry Industry Mid to high-teens% In the 30% range Demand Demand Micron Micron In-line with market demand while we In-line with market demand Supply Supply transition to replacement gat
Slide 12: Operational Excellence
Operational Excellence 12
Slide 13: Best-in-Class Manufacturing Practices for Competitive and Sustainable Operations
Best-in-Class Manufacturing Practices for Competitive and Sustainable Operations Scaling up our Flexibility and Smart Environmental sites agility manufacturing responsibility 13
Slide 14: Investing in Cleanroom Space and Tool Standardization Across DRAM Fabs
Investing in Tool Cleanroom Standardization Space Across DRAM Enhancing Enabling node transitions Fabs while maintaining stable Our Fab wafer capacity 1z and Beyond FY20 CapEx for cleanroom Matching Network >85% space 1.5-2x of normal 1x, 1y ▪ Higher capital asset utilization Matching 55-65% ▪ Incre
Slide 15: Enhancing Assembly & Test Captive Footprint
FY18 FY20 Captive Footprint Enhancing >60% Assembly ~45% & Test Captive Footprint Capacity More captive capacity and geographic diversity Improves our cost DRAM China China Malaysia MalaysiaTaiwan competitiveness, agility NAND/MCP Singapore Malaysia Singapore Malaysia MalaysiaTaiwan and quality SSD
Slide 16: Smart Manufacturing
Smart Manufacturing AI, Image Analysis, IoT all providing tremendous value now and, in the future Productivity Quality Yield Use Case AI to improve factory Real-time monitoring of Yield improvement through efficiency production line metrics to advanced analytics and improve product quality auto diag
Slide 17: Environmental Responsibility Focus Areas
Focus Areas Emissions Process Green House Gas Abatement Environmental Heat Transfer Efficiency Improvement Energy Energy Efficient Facilities Responsibility Smart Control Systems Micron plans to spend ~2% of CapEx Water Enhanced Water Filtration Systems on future sustainability programs Engagement i
Slide 18: Results
Results 18
Slide 19: Our Business Continues to Get Stronger
Our Business Continues to Get Stronger Faster time to Enhanced Rock-solid revenue profitability balance sheet 19
Slide 20: Time to Customer Qualification
Time to Time to Customer Qualification Customer Qualification 30% Reduced time to qualify new products with customers by 30% in two years ▪ Early customer engagement ▪ Close collaboration throughout qualification ▪ Product delivery execution FY18 FY19 1HFY20 20
Slide 21: Enhancing Our Profitability
Enhancing Our Micron LTM EBITDA Margin 1 Profitability 70% 63% 50% >2500 33% 40% > basis points 30% $9B 10% of EBITDA 1% Structural (10%) FY-02 FY-06 FY-10 FY-14 FY-18 Q2-20 operating profit margin LTM Source: Micron improvement 1. EBITDA is a non-GAAP measure defined as GAAP net income plus gains f
Slide 22: Enhanced Balance Sheet
Net Cash Investment Grade $2.7B Balance Sheet Liquidity > $10B Net cash $2.7B -$5.0B Investing for high ROIC FQ4-16 FQ2-20 Liquidity and net cash as of end of FQ2-20 Liquidity defined as cash, short-term and long-term marketable investments, restricted cash and undrawn revolver capacity Net cash def
Slide 23: The New Micron
The New Micron Memory & storage We strive for Our cross-cycle are more relevant Product Leadership & financial performance than ever Operational Excellence continues to improve 23
Slide 24: Non-GAAP Reconciliations
Non-GAAP Reconciliations 24
Slide 25: LTM EBITDA Margin Reconciliation
LTM EBITDA Margin Reconciliation Amount in millions FY-02 FY-03 FY-04 FY-05 FY-06 FY-07 FY-08 FY-09 FY-10 FY-11 LTM EBITDA Net income (loss) $(907) $(1,273) $157 $188 $415 $(209) $(1,665) $(1,993) $1,900 $190 Interest (income) expense, net (35) 18 21 15 (76) (92) 39 160 160 101 Income tax provision
Slide 26: LTM EBITDA Margin and Net Cash Reconciliation
LTM EBITDA Margin and Net Cash Reconciliation Amount in millions FY-12 FY-13 FY-14 FY-15 FY-16 FY-17 FY-18 FY-19 LTM FQ2-20 LTM EBITDA Net income (loss) $(1,031) $1,194 $3,079 $2,899 $(275) $5,090 $14,138 $6,358 $2,352 Interest (income) expense, net 171 217 329 336 395 560 222 (77) (26) Income tax p
Slide 27: 27
27