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September 28, 1998

MICRON TECHNOLOGY HITS LOSSES BUT DRAM PRICES FIRM

By CBR Staff Writer

Micron Technology, the Boise, Idaho, memory chip maker, posted its third consecutive quarter of heavy losses on Monday but a recent increase in demand for DRAM chips led to a modest 5% upswing in prices after the close of the quarter, the company said. Micron reported fourth quarter net losses of $89m down from profits last time of $72m while revenues sank 27% to $692m. Micron blamed the poor quarter on severe declines in per megabit selling prices for its memory products. While production volumes were significantly higher than last year, the company was unable to reduce its cost base faster than the decline in prices, it said. But CEO Steve Appleton said current market conditions were encouraging, although he stopped short of assuring investors that recent price increases were sustainable in the longer term. The company’s PC manufacturing subsidiary, Micron Electronics Inc, reported increased profits but substantially decreased revenues for the period (see separate story). There was also no comment from the company on Friday’s rumors that Intel is poised to take a minority stake in Micron.

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