Slide 1: Financial Results FQ4 2020
Financial Results FQ4 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. Statements regarding products, including statements regardi
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: Sanjay Mehrotra, President and CEO
Sanjay Mehrotra President and CEO 3 September 29, 2020
Slide 4: Highlights
Highlights ▪ Solid FQ4-20 revenue and profitability driven by strength in DRAM shipments to cloud, PC and game console customers ▪ In FQ4-20, already achieved our High Value Solutions mix target ▪ Healthy FY-20 financial results ▪ In FY-20, introduced industry's first 1Z nm node; first to market wit
Slide 5: Operations
Operations ▪ Continued to operate our fabs at normal capacity in FY-20 ▪ Achieved record production from our assembly and test facilities in Xi'an, Taiwan and Singapore in FY-20 ▪ Today, almost three quarters of Micron team members back on-site including manufacturing operations which are running cl
Slide 6: Strong Technology and Roadmap Execution
DRAM NAND ▪ Leading the industry in 1Z nm ▪ 128L RG entered volume production Strong production mix, a significant contributor to our FQ4-20 sales in FQ3-20; Began shipping RG- based consumer SSDs in FQ4-20 Technology ▪ Making good progress on 1-alpha which remains on track for introduction ▪ Making
Slide 7: End Market Highlights
End Market Highlights SSDs Data Center & Mobile PC, Graphics & Auto ▪ Expanded our NVMe portfolio Networking ▪ Well positioned to win in 5G ▪ PC: WFH trend drove strong and continued SATA market ▪ Data Center: Leveraging era with industry leading notebook demand, with leadership our 1Z DRAM, cloud D
Slide 8: Market Trends
Market Trends ▪ Smartphone, auto, and consumer end markets have started to recover, and we see further demand improvements ahead ▪ Cloud and laptop demand continues to be healthy, supported by the work from home and shop from home trends; gaming demand is robust ▪ Short-term outlook has weakened; en
Slide 9: Industry Outlook
Industry Outlook ▪ CY-20 industry bit demand growth is likely to be in the mid-teens percent range with supply constraints for 8Gb-based DRAM products DRAM ▪ CY-21 industry bit demand growth of approximately 20%; disciplined industry capex to result in improving market conditions throughout CY-21 ▪
Slide 10: Micron Outlook
Micron Outlook ▪ CY-20 bit supply growth expected to be above industry demand ▪ CY-21 bit supply growth expected to moderate to less than industry demand DRAM ▪ Long-term Micron bit supply growth CAGR in line with industry demand ▪ FY-21 cost reductions expected to be in mid-single-digit percent ran
Slide 11: Dave Zinsner, Chief Financial Officer
Dave Zinsner Chief Financial Officer 11 September 29, 2020
Slide 12: Revenue
Revenue FQ4-20 FY-20 $6.1B $21.4B Up 11% Q/Q and up 24% Y/Y Down 8% Y/Y 12 September 29, 2020
Slide 13: DRAM
DRAM ▪ 72% of total revenue in FQ4-20 ▪ Revenue up 22% Q/Q and up 29% Y/Y FQ4-20 ▪ Bit shipments up mid-20% range Q/Q ▪ ASPs down lower-single-digit percent range Q/Q ▪ 68% of total revenue in FY-20 FY-20 ▪ Revenue down 14% Y/Y The metrics above reflect the change in reporting for MCPs and SSDs, whi
Slide 14: NAND
NAND ▪ 25% of total revenue in FQ4-20 ▪ Revenue down 8% Q/Q and up 27% Y/Y FQ4-20 ▪ Bit shipments flat Q/Q ▪ ASPs down upper-single-digit percent range Q/Q ▪ 29% of total revenue in FY-20 FY-20 ▪ Revenue up 14% Y/Y The metrics above reflect the change in reporting for MCPs and SSDs, which have been
Slide 15: Revenue by Business Unit
Revenue by Business Unit Q/Q % Y/Y % Y/Y % FQ4-20 FQ3-20 FQ4-19 FY-20 FY-19 Change Change Change Compute and Networking (CNBU) $3,020M $2,218M 36% $1,903M 59% $9,184M $9,968M (8)% Mobile (MBU) $1,462M $1,525M (4)% $1,406M 4% $5,702M $6,403M (11)% Storage (SBU) $913M $1,014M (10)% $848M 8% $3,765M $3
Slide 16: Non-GAAP Operating Results
Non-GAAP Operating Results FQ4-20 FY-20 Revenue $6.1B $21.4B Gross Margin 34.9% 31.3% Net Income $1.2B $3.2B Diluted EPS $1.08 $2.83 Operating Expenses $809M $3.3B Operating Income $1.3B $3.4B Cash from Operations $2.3B $8.3B 16 September 29, 2020
Slide 17: Capital Allocation
Capital Allocation $41M used for share repurchases FY-20 CapEx of $7.9B in FQ4-20 (824,000 shares) Cash Net FY-21 CapEx guidance of ~$9B Return CapEx1 1 Cash3- $2.6B of net cash at end Liquidity2 2 $11.8B in liquidity at end of FQ4-20 Debt 3 of FQ4-20 1Capex net of amounts funded by partners and pro
Slide 18: Non-GAAP Guidance
Non-GAAP Guidance FQ1-21 Revenue $5.2 billion ± $200 million Gross Margin 27.5% ± 1% Operating Expenses $825 million ± $25 million Interest (income) expense, net $35 million Diluted EPS* $0.47 ± $0.07 FY-21 CapEx ~$9 billion *Based on ~1.15 billion diluted shares 18 September 29, 2020
Slide 19: Other Key Data
Other Key Data 19 September 29, 2020
Slide 20: Financial Summary
Financial Summary Non-GAAP Amounts in millions, except per share FQ4-20 % of FQ3-20 % of FQ4-19 % of Revenue Revenue Revenue Revenue $6,056 100% $5,438 100% $4,870 100% Gross margin 2,111 35% 1,804 33% 1,491 31% Operating income 1,302 21% 981 18% 694 14% Income tax (provision) benefit (46) (29) (64)
Slide 21: Financial Summary
Financial Summary Non-GAAP Amounts in millions, except per share FY-20 % of FY-19 % of Revenue Revenue Revenue $21,435 100% $23,406 100% Gross margin 6,718 31% 10,973 47% Operating income 3,419 16% 7,801 33% Income tax (provision) benefit (134) (579) Net income attributable to Micron 3,235 15% 7,314
Slide 22: Non-GAAP Financial Data and Guidance
Non-GAAP Financial Data and Guidance % of Revenue FQ4-20 FQ4-20 Non-GAAP FQ1-21 (amounts in millions, DRAM 72% Non-GAAP Guidance except per share) NAND 25% Revenue $ 6,056 $5.2 billion ± $200 million Gross margin 34.9% 27.5% ± 1% % Sales Volume Change FQ4-20 Q/Q Operating expenses $ 809 $825 million
Slide 23: Revenue by Technology
Revenue by Technology % of % of % of Amounts in millions FQ4-20 Revenue FQ3-20 FQ4-19 Revenue Revenue DRAM $4,371 72% $3,587 66% $3,399 70% NAND 1,530 25% 1,665 31% 1,204 25% Other 155 3% 186 3% 267 5% Total $6,056 100% $5,438 100% $4,870 100% Revenue for MCPs and SSDs, which contain both DRAM and N
Slide 24: Revenue by Technology
Revenue by Technology % of % of Amounts in millions FY-20 FY-19 Revenue Revenue DRAM $14,510 68% $16,841 72% NAND 6,131 29% 5,355 23% Other 794 4% 1,210 5% Total $21,435 100% $23,406 100% Revenue for MCPs and SSDs, which contain both DRAM and NAND, are disaggregated into DRAM and NAND in the table a
Slide 25: Non-GAAP Reconciliations
Non-GAAP Reconciliations 25 September 29, 2020
Slide 26: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FQ4-20 FQ3-20 FQ4-19 GAAP gross margin $ 2,068 $ 1,763 $ 1,395 Stock-based compensation 37 34 29 Start-up and preproduction costs — — 12 Employee severance (1) — 47 Other 7 7 8 Non-GAAP gross margin $ 2,111 $ 1,804 $ 1,491 GAAP operat
Slide 27: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FQ4-20 FQ3-20 FQ4-19 GAAP net income attributable to Micron $ 988 $ 803 $ 561 Stock-based compensation 89 82 67 Start-up and preproduction costs — — 12 Employee severance (1) — 79 Restructure and asset impairments 50 4 (122) Amortizat
Slide 28: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FQ4-20 FQ3-20 FQ4-19 GAAP cost of goods sold $ 3,988 $ 3,675 $ 3,475 Stock-based compensation (37) (34) (29) Start-up and preproduction costs — — (12) Employee severance 1 — (47) Other (7) (7) (8) Non-GAAP cost of goods sold $ 3,945 $
Slide 29: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FQ4-20 FQ3-20 FQ4-19 GAAP shares used in diluted EPS calculations 1,131 1,129 1,128 Adjustment for stock-based compensation and capped calls 11 13 6 Non-GAAP shares used in diluted EPS calculations 1,142 1,142 1,134 GAAP diluted earni
Slide 30: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FQ4-20 FQ3-20 FQ4-19 Net cash provided by operating activities $ 2,271 $ 2,023 $ 2,233 Investments in capital expenditures, net Expenditures for property, plant, and equipment, net* (2,268) (1,937) (1,983) Payments on equipment purcha
Slide 31: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions, except per share amounts FY-20 FY-19 GAAP gross margin $ 6,552 $ 10,702 Stock-based compensation 139 102 Start-up and preproduction costs — 58 Employee severance — 73 Other 27 38 Non-GAAP gross margin $ 6,718 $ 10,973 GAAP operating
Slide 32: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions, except per share amounts FY-20 FY-19 GAAP net income attributable to Micron $ 2,687 $ 6,313 Stock-based compensation 328 243 Start-up and preproduction costs — 58 Employee severance — 116 Restructure and asset impairments 60 (32) Amo
Slide 33: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions, except per share amounts FY-20 FY-19 GAAP cost of goods sold $ 14,883 $ 12,704 Stock-based compensation (139) (102) Start-up and preproduction costs — (58) Employee severance — (73) Other (27) (38) Non-GAAP cost of goods sold $ 14,71
Slide 34: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FY-20 FY-19 GAAP shares used in diluted EPS calculations 1,131 1,143 Adjustment for stock-based compensation and capped calls 10 7 Non-GAAP shares used in diluted EPS calculations 1,141 1,150 GAAP diluted earnings per share $ 2.37 $ 5
Slide 35: Consolidated Non-GAAP Reconciliations
Consolidated Non-GAAP Reconciliations Results Amounts in millions FY-20 FY-19 Net cash provided by operating activities $ 8,306 $ 13,189 Investments in capital expenditures, net Expenditures for property, plant, and equipment, net* (8,154) (9,634) Payments on equipment purchase contracts (63) (75) A
Slide 36: FQ1-21 Guidance Non-GAAP Reconciliations
FQ1-21 Guidance Non-GAAP Reconciliations GAAP Adjustments Non-GAAP Revenue $5.2 billion ± $200 million — $5.2 billion ± $200 million Gross margin 26.5% ± 1.5% 1% A 27.5% ± 1% Operating expenses $873 million ± $25 million $48 million B $825 million ± $25 million Interest (income) expense, net $37 mil
Slide 37: Micron
Micron