<PAGE>
FORM 10-Q/A
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended November 28, 1996
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Commission File Number: 1-10658
Micron Technology, Inc.
State or other jurisdiction of incorporation or organization: Delaware
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Internal Revenue Service -- Employer Identification No. 75-1618004
8000 S. Federal Way, Boise, Idaho 83706-9632
(208) 368-4000
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
----- -----
The number of outstanding shares of the registrant's Common Stock as of
December 18, 1996 was 209,537,615.
<PAGE>
Part 1. FINANCIAL INFORMATION
Item 1. Financial Statements
- ----------------------------
MICRON TECHNOLOGY, INC.
Consolidated Balance Sheets
(Dollars in millions, except for par value data)
<TABLE>
<CAPTION>
November 28, August 29,
As of 1996 1996
- --------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
ASSETS
Cash and equivalents $ 222.3 $ 276.1
Liquid investments 5.5 10.7
Receivables 315.3 347.4
Inventories 304.1 251.4
Prepaid expenses 14.1 13.4
Deferred income taxes 48.8 65.0
-------- --------
Total current assets 910.1 964.0
Product and process technology, net 42.6 43.2
Property, plant and equipment, net 2,740.1 2,708.1
Other assets 27.9 36.2
-------- --------
Total assets $3,720.7 $3,751.5
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses $ 427.0 $ 423.7
Short-term debt -- 90.0
Deferred income 10.1 7.8
Equipment purchase contracts 63.5 67.8
Current portion of long-term debt 103.8 75.2
-------- --------
Total current liabilities 604.4 664.5
Long-term debt 305.6 314.6
Deferred income taxes 163.4 157.4
Non-current product and process technology 43.2 43.5
Other liabilities 18.6 15.7
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Total liabilities 1,135.2 1,195.7
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Minority interests 57.3 53.8
Commitments and contingencies
Common stock, $0.10 par value, authorized
1.0 billion shares, issued and outstanding
209.3 million and 208.8 million shares,
respectively 20.9 20.9
Additional capital 440.2 434.7
Retained earnings 2,067.1 2,046.4
-------- --------
Total shareholders' equity 2,528.2 2,502.0
-------- --------
Total liabilities and shareholders' equity $3,720.7 $3,751.5
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE>
MICRON TECHNOLOGY, INC.
Consolidated Statements of Operations
(Amounts in millions, except for per share data)
(Unaudited)
<TABLE>
<CAPTION>
November 28, November 30,
For the quarter ended 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Net sales $ 728.1 $ 1,185.8
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Costs and expenses:
Cost of goods sold 572.9 538.1
Selling, general and administrative 66.6 72.7
Research and development 47.2 46.6
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Total costs and expenses 686.7 657.4
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Operating income 41.4 528.4
Interest expense (income), net 2.1 (8.4)
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Income before income taxes and
minority interests 39.3 536.8
Income tax provision 15.6 204.6
Minority interests 3.1 3.7
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Net income $ 20.6 $ 328.5
======= =========
Earnings per share:
Primary $0.10 $1.51
Fully diluted 0.10 1.51
Number of shares used in per share calculations:
Primary 214.0 217.2
Fully diluted 214.5 217.2
Cash dividend declared per share -- $0.05
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE>
MICRON TECHNOLOGY, INC.
Consolidated Statements of Cash Flows
(Dollars in millions)
(Unaudited)
<TABLE>
<CAPTION>
November 28, November 30,
For the quarter ended 1996 1995
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 20.6 $ 328.5
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 110.3 78.4
Decrease (increase) in receivables 32.0 (121.2)
Increase in inventories (52.7) (61.4)
Increase in accounts payable and accrued expenses 3.4 304.6
Increase in deferred income taxes 22.1 11.4
Gain on sale of investment (10.1) --
Other 22.3 (4.9)
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Net cash provided by operating activities 147.9 535.4
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CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment (84.6) (426.7)
Purchase of available-for-sale and held-to-maturity securities (2.1) (184.5)
Proceeds from sales and maturities of securities 19.4 179.1
Proceeds from sale of equipment 1.8 .5
Other (2.1) (4.4)
-------- ---------
Net cash used for investing activities (67.6) (436.0)
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of long-term debt 37.6 --
Net repayments on borrowings on lines of credit (90.0) --
Payments on equipment purchase contracts (66.8) (55.1)
Repayments of long-term debt (18.3) (6.6)
Proceeds from issuance of common stock 4.2 6.6
Other (.8) .4
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Net cash used for financing activities (134.1) (54.7)
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Net increase (decrease) in cash and equivalents (53.8) 44.7
Cash and equivalents at beginning of period 276.1 128.1
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Cash and equivalents at end of period $ 222.3 $ 172.8
======== =========
SUPPLEMENTAL DISCLOSURES
Income taxes refunded (paid), net $ 38.4 $ (44.1)
Interest paid (7.9) (2.3)
Noncash investing and financing activities:
Equipment acquisitions on contracts payable and capital leases 62.5 90.8
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
Notes to Consolidated Financial Statements
(All tabular dollar amounts are stated in millions)
1. Unaudited Interim Financial Statements
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting solely of normal
recurring adjustments) necessary to present fairly the consolidated financial
position of Micron Technology, Inc., and subsidiaries (the "Company"), and their
consolidated results of operations and cash flows.
This report on Form 10-Q for the quarter ended November 28, 1996, should be
read in conjunction with the Company's Annual Report to Shareholders and/or Form
10-K for the year ended August 29, 1996.
<TABLE>
<CAPTION>
November 28, August 29,
2. Receivables 1996 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
Trade receivables $ 296.0 $ 288.2
Income taxes receivable 22.8 69.1
Other 17.8 17.6
Allowance for returns and discounts (13.6) (18.5)
Allowance for doubtful accounts (7.7) (9.0)
-------- --------
$ 315.3 $ 347.4
======== ========
November 28, August 29,
3. Inventories 1996 1996
- --------------------------------------------------------------------------------
Finished goods $ 42.5 $ 54.3
Work in progress 128.1 112.8
Raw materials and supplies 133.5 84.3
-------- --------
$ 304.1 $ 251.4
======== ========
November 28, August 29,
4. Product and process technology, net 1996 1996
- --------------------------------------------------------------------------------
Product and process technology, at cost $ 169.7 $ 167.5
Less accumulated amortization (127.1) (124.3)
-------- --------
$ 42.6 $ 43.2
======== ========
November 28, August 29,
5. Property, plant and equipment, net 1996 1996
- --------------------------------------------------------------------------------
Land $ 37.2 $ 37.3
Buildings 754.2 674.4
Machinery and equipment 2,175.3 2,073.4
Construction in progress 677.3 753.9
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3,644.0 3,539.0
Less accumulated depreciation and
amortization (903.9) (830.9)
-------- --------
$2,740.1 $2,708.1
======== ========
</TABLE>
As of November 28, 1996, property, plant and equipment included unamortized
costs of $623 million for the Company's semiconductor memory manufacturing
facility in Lehi, Utah, of which $585 million has not been placed in service and
is not being depreciated.
4
<PAGE>
Notes to Consolidated Financial Statements, continued
<TABLE>
<CAPTION>
6. Accounts payable and accrued expenses
November 28, August 29,
1996 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
Accounts payable $ 235.0 $ 232.4
Salaries, wages and benefits 60.6 67.3
Products and process technology payable 61.6 39.7
Income taxes payable 7.2 22.7
Other 62.6 61.6
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$ 427.0 $ 423.7
======= =======
<CAPTION>
7. Long-term debt November 28, August 29,
1996 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
Notes payable in periodic installments
through July 2015, weighted average
interest rate of 7.31% and 7.28%,
respectively $ 343.3 $ 322.0
Capitalized lease obligations payable in
monthly installments through August
2002, weighted average interest rate
of 7.72% 40.8 42.8
Noninterest bearing obligations, $3 million
due October 1997 and $20.5 million due
December 1997, weighted average imputed
interest rate of 7.17% 21.9 21.6
Note payable, due June 1998, weighted average
interest rate of 5.14% and 5.30%, respectively 3.0 3.0
Other 0.4 0.4
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409.4 389.8
Less current portion (103.8) (75.2)
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$ 305.6 $ 314.6
======= =======
</TABLE>
8. Earnings per share
Earnings per share is computed using the weighted average number of common
and common equivalent shares outstanding. Common equivalent shares result from
the assumed exercise of outstanding stock options and affect earnings per share
when they have a dilutive effect.
9. Income taxes
The estimated effective income tax rate for fiscal 1997 is 39.6%. The
effective income tax rate principally reflects the statutory corporate income
tax rate and the net effect of state taxation. The Company has not recognized a
deferred tax liability for the difference between the book basis and tax basis
of the common stock of its domestic subsidiaries (such difference relates
primarily to unremitted earnings) to the extent the Company expects these basis
differences to not be subject to tax at the parent level.
5
<PAGE>
Notes to Consolidated Financial Statements, continued
10. Commitments
As of November 28, 1996, the Company had commitments extending into fiscal
1998 of approximately $148 million for equipment purchase and $24 million for
the construction of buildings.
11. Contingencies
Periodically, the Company is made aware that technology used by the Company
in the manufacture of some or all of its products may infringe on product or
process technology rights held by others. The Company has accrued a liability
and charged operations for the estimated costs of settlement or adjudication of
asserted and unasserted claims for infringement prior to the balance sheet date.
Determination that the Company's manufacture of products has infringed on valid
rights held by others could have a material adverse effect on the Company's
financial position, results of operations or cash flows and could require
changes in production processes and products. The Company is currently party to
various other legal actions arising out of the normal course of business, none
of which is expected to have a material effect on the Company's financial
position or results of operations.
6
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
- --------------------------------------------------------------------------------
of Operations.
- -------------
The following discussion contains trend information and other forward
looking statements that involve a number of risks and uncertainties. The
Company's actual results could differ materially from the Company's historical
results of operations and those discussed in the forward looking statements.
Factors that could cause actual results to differ materially are included, but
are not limited to, those identified in "Certain Factors." All period
references are to the Company's fiscal periods ended November 28, 1996,
August 29, 1996, or November 30, 1995, unless otherwise indicated. All tabular
dollar amounts are stated in millions.
Micron Technology, Inc., and its subsidiaries (hereinafter referred to
collectively as the "Company" or "MTI") design, develop, manufacture and market
semiconductor memory products, primarily DRAM. Through its approximately 79%
owned subsidiary, Micron Electronics, Inc. ("MEI"), the Company also develops,
markets, manufactures, and supports PC systems, and operates a contract
manufacturing and component recovery business.
Net income for the first quarter of fiscal 1997 was $21 million, or
$0.10 per fully diluted share, on net sales of $728 million. For the first
quarter of fiscal 1996 net income was $328 million, or $1.51 per fully diluted
share, on net sales of $1,186 million. For the fourth quarter of fiscal 1996,
net income was $19 million, or $0.09 per fully diluted share, on net sales of
$700 million. Results of operations for the first quarter of fiscal 1997
included a $6 million after-tax gain on the sale of an investment. Fully diluted
earnings per share for the quarter benefited by $0.03 from the after-tax gain.
Results of Operations
- ---------------------
The following table presents the Company's net sales by related products
or services. The value of the Company's semiconductor memory products included
in PC systems and other products is included in the caption "Semiconductor
memory products." The caption "Other" includes revenue from contract
manufacturing and module assembly services, construction management services,
government contracts, and licensing fees.
<TABLE>
<CAPTION>
First Quarter
------------------------------------------------
1997 % Change 1996
------------------------------------------------
Net sales % Net sales %
<S> <C> <C> <C> <C> <C>
Semiconductor memory products $342.2 47.0 $ 884.5 74.6
Personal computer systems 333.8 45.8 219.1 18.5
Other 52.1 7.2 82.2 6.9
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Total net sales $728.1 100.0 (38.6%) $1,185.8 100.0
----------------- --------------------
</TABLE>
Net sales of semiconductor memory products for the first quarter of
fiscal 1997 decreased by 61% as compared to the first quarter of fiscal 1996,
primarily due to the sharp decline in average selling prices which was partially
offset by increased production of semiconductor memory products. Average selling
prices per megabit of memory declined approximately 84% from the first quarter
of fiscal 1996 to the first quarter of fiscal 1997. Average selling prices in
the first quarter of fiscal 1997 were approximately 22% lower than in the fourth
quarter of fiscal 1996. Average selling prices for the Company's semiconductor
memory products at the end of the first quarter of fiscal 1997 had declined
approximately 10% from average selling prices for semiconductor memory products
for the first quarter of fiscal 1997. The Company's principal memory product in
the first quarter of fiscal 1997 was the 16 Meg DRAM, which comprised
approximately 54% of the net sales of semiconductor memory. Total megabits
produced in the first quarter of fiscal 1997 more than doubled the megabits
produced in the first quarter of fiscal 1996 and represented a 48% increase in
production over the fourth quarter of fiscal 1996. These increases were
principally due to the conversion of all fabs to 8-inch wafer processing,
transition to the 16 Meg DRAM as the Company's principal memory product, ongoing
transitions to successive shrink versions of existing memory products, and
enhanced yields on existing memory products.
Net sales of PC systems for the first quarter of fiscal 1997, less the
value of the Company's semiconductor memory products included therein, increased
by approximately 52% as compared to the first quarter of fiscal 1996. Unit sales
of PC systems in the first quarter of fiscal 1997 were approximately 22% higher
than in the first quarter of fiscal 1996 principally due to an increase in sales
of desktop systems to governmental entities and introduction of the Micron
Millenia TransPort(TM) notebook systems in the third quarter of fiscal 1996. Due
to the Company's historical position as a high-end PC system provider, shortages
of Pentium(R) Pro microprocessors and certain high-performance disk drives
hampered PC system sales in the first quarter of fiscal 1997. Unit sales of PC
systems were relatively flat from the fourth quarter of fiscal 1996 to the first
quarter of fiscal 1997.
7
<PAGE>
First Quarter
-------------------------------
1997 Change 1996
-------------------------------
Gross margin $155.2 (76.0%) $647.7
as a % of net sales 21.3% 54.6%
The Company's gross margin percentage was approximately 60% lower in the
first quarter of fiscal 1997 compared to the first quarter of fiscal 1996. The
reduction was primarily the result of a lower gross margin percentage on the
Company's semiconductor memory products.
The Company's gross margin percentage on semiconductor memory products
decreased to approximately 24% in the first quarter of fiscal 1997, compared to
70% in the first quarter of fiscal 1996. Notwithstanding substantial decreases
in per unit manufacturing costs in recent periods, the gross margin percentage
on semiconductor memory products was lower as average selling prices for such
products declined more rapidly than per unit manufacturing costs. Decreases in
per unit manufacturing costs were achieved through significant increases in die
per wafer achieved through conversion of all fabs to 8-inch wafer processing,
transitions to shrink versions of existing products, shifts in the Company's mix
of semiconductor memory products to a higher average density, and improved
manufacturing yields. For the first quarter of fiscal 1997, decreases in per
unit manufacturing costs were commensurate with decreases in average selling
prices for the same period, resulting in a slightly improved gross margin for
the first quarter of fiscal 1997 as compared to the fourth quarter of fiscal
1996.
The gross margin amount provided by the Company's PC operations in the
first quarter of fiscal 1997 increased significantly compared to the first
quarter of fiscal 1996 principally due to a higher gross margin percentage
realized on PC system sales coupled with a 22% increase in unit sales of PC
systems. The higher gross margin percentage realized on PC system sales in the
first quarter of fiscal 1997 was primarily due to lower component costs, and to
a lesser extent, higher margins realized on sales of notebook systems. The gross
margin percentage for PC systems remained relatively stable comparing the first
quarter of fiscal 1997 to the fourth quarter of fiscal 1996.
First Quarter
-------------------------------
1997 Change 1996
-------------------------------
Selling, general and administrative $ 66.6 (8.4)% $ 72.7
as a % of net sales 9.2% 6.1%
Selling, general and administrative expenses for the first quarter of
fiscal 1997 reflect an approximate $10 million pretax gain from the sale of an
investment which was the primary cause of the decrease in such expenses compared
to the first quarter of fiscal 1996. A reduction in the Company's allowance for
bad debts also contributed to the decrease in selling, general and
administrative expense. The overall decrease in selling, general and
administrative expenses was partially offset by increased advertising costs for
the Company's PC operations. The Company expects advertising costs to increase
at a rate commensurate with growth in the Company's PC operations.
First Quarter
-------------------------------
1997 Change 1996
-------------------------------
Research and development $ 47.2 1.3% $ 46.6
as a % of net sales 6.5% 3.9%
Research and development expenses vary primarily based on the number of
wafers and personnel, and the cost of advanced equipment dedicated to new
product and process development. Research and development efforts in the first
quarter of fiscal 1997 were focused principally on further development of shrink
versions of the 16 Meg DRAM. Development efforts are also focused on 16 Meg and
64 Meg SDRAM and a move from .35 micron (u) process technology to .30u, .25u and
.18u process technology. Other research and development efforts are currently
devoted to the design of SRAM, the 64 Meg and 256 Meg DRAMs, and design and
development of new technologies including remote intelligent communications
(RIC) products and Flash semiconductor memory products.
Liquidity and Capital Resources
- -------------------------------
As of November 28, 1996, the Company had cash and liquid investments
totalling $228 million, representing a decrease of $59 million during the first
quarter of fiscal 1997. During the quarter the Company repaid the entire $90
million outstanding on
8
<PAGE>
its bank lines of credit. Approximately $122 million of the Company's
consolidated cash and liquid investments were held by MEI. Cash generated from
operations by MEI is not readily available to finance operations or other
expenditures of MTI. During the first quarter of fiscal 1997 the Company's
inventories increased by $53 million. Raw materials and work in progress
inventories as of November 28, 1996 increased 58% and 14%, respectively,
compared to levels as of August 29, 1996. The increase in raw materials
inventories was mainly attributable to increased raw materials associated with
PC operations. A lower than expected level of PC shipments in the first quarter
of fiscal 1997, principally as a result of component shortages, led to an
increase in the Company's inventories of other components. The increase in work
in progress was due to higher costs associated with 8-inch wafer processing.
The Company's principal sources of liquidity during the first quarter of
fiscal 1997 were cash flows from operations of $148 million and equipment
financing of $38 million. The principal uses of funds in the first quarter of
fiscal 1997 were net repayments of the Company's bank lines of credit of $90
million, $85 million for property, plant and equipment and $85 million for
repayments of equipment contracts and long-term debt.
Cash flow from operations for the first quarter of fiscal 1997 was lower than
cash flow from operations for the first quarter of fiscal 1996 primarily as a
result of lower overall average selling prices for semiconductor memory
products. Cash flow from operations depends significantly on average selling
prices and variable per unit manufacturing costs for the Company's semiconductor
memory products. In fiscal 1996, the rate of decline in average selling prices
for semiconductor memory products surpassed the rate at which the Company was
able to decrease per unit manufacturing costs. As a result, the Company's result
of operations and cash flow were adversely impacted.
As of November 28, 1996, the Company had contractual commitments extending
into fiscal 1998 of approximately $148 million for equipment purchases and
approximately $24 million for the construction of facilities. The Company
estimates it will spend approximately $600 million in fiscal 1997 for purchases
of equipment, construction and improvement of buildings primarily to enhance
capacity and product and process technology at its existing facilities. The
Company believes that in order to pursue development of new product and process
technologies at a rate commensurate to the Company's competition, and to support
future growth, achieve operating efficiencies, and enhance product quality it
must continue to invest in manufacturing technology, facilities and capital
equipment, research and development, and product and process technology. As the
Company considers its long-term capacity and product and process technology
enhancement programs it continues to evaluate a number of financing
alternatives, including additional financing from external sources. In this
regard, the Company filed an undesignated shelf registration statement on
December 20, 1996 for up to $1 billion in debt or equity securities to give the
Company the flexibility, if and when financing is advantageous, to effect an
appropriately sized offering. In addition, MEI filed a shelf registration
statement on October 11, 1996 allowing for an offering of up to $325 million of
MEI common stock of which $250 million may be offered by MTI and certain
management employees.
The Company has a $400 million revolving credit agreement expiring in May
1999. As of November 28, 1996, the Company had no borrowings outstanding under
the facility. The agreement contains certain restrictive covenants, including a
borrowing base tied to the Company's accounts receivable, an Earnings Before
Interest, Taxes, Depreciation and Amortization (EBITDA) covenant, and a maximum
net loss covenant. As of November 28, 1996, the Company was in compliance with
all covenants under the facility. There can be no assurance that the Company
will continue to be able to meet the terms of the covenants or be able to borrow
the full amount of the credit facility.
MEI has an unsecured revolving credit facility with two financial
institutions providing for borrowings of up to $40 million. As of November 28,
1996, MEI had no borrowings outstanding under the agreement. Borrowings are
limited based on the amount of MEI's eligible receivables. As of November 28,
1996, MEI was eligible to borrow the full $40 million pursuant to the agreement.
Certain Factors
- ---------------
In addition to the factors discussed elsewhere in this Form 10-Q and in the
Company's Form 10-K for the fiscal year ended August 29, 1996, the following are
important factors which could cause actual results or events to differ
materially from those contained in any forward looking statements made by or on
behalf of the Company.
The semiconductor memory industry is characterized by rapid technological
change, frequent product introductions and enhancements, difficult product
transitions, relatively short product life cycles, and volatile market
conditions. These characteristics historically have made the semiconductor
industry highly cyclical, particularly in the market for DRAMs, which are the
Company's primary products.
The selling prices for the Company's semiconductor memory products fluctuate
significantly with changes in the balance of supply and demand for these
commodity products. In recent periods the growth in worldwide supply has
outpaced growth in worldwide demand, resulting in a significant decrease in
average selling prices for the Company's semiconductor memory products. In
fiscal 1996, the rate of decline in average selling prices for semiconductor
memory products surpassed the rate at
9
<PAGE>
which the Company was able to decrease per unit manufacturing costs, and, as a
result, the Company's cash flows were significantly adversely affected,
particularly in the second half of fiscal 1996. In the first quarter of fiscal
1997 the rate of decline in average selling prices for semiconductor memory
products was commensurate with the rate of decline in per unit manufacturing
costs. There can be no assurance that the trend experienced in the first
quarter of fiscal 1997 will continue. In the event that average selling prices
decline at a faster rate than that at which the Company is able to decrease per
unit manufacturing costs, the Company could be materially adversely affected in
its operations and cash flows. Additionally, although some of the Company's
competitors have announced adjustments to the rate at which they will implement
capacity expansion programs, many of the Company's competitors have already
added significant capacity for the production of semiconductor memory products.
The amount of capacity to be placed into production and future yield
improvements by the Company's competitors could dramatically increase worldwide
supply of semiconductor memory and increase downward pressure on pricing.
Approximately 75% of the Company's sales of semiconductor memory products
during the first quarter of fiscal 1997 were directly into the PC or peripheral
markets. DRAMs are the most widely used semiconductor memory component in most
PC systems. The Company believes that the rate of growth in average worldwide
sales of PC systems has declined and may remain below prior periods' growth
rates for the forseeable future. In addition, the growth rate in the amount of
semiconductor memory per PC system may decrease in the future as well. Should
demand for PC systems decrease or the growth rate in the amount of memory per PC
system decrease, growth in demand for semiconductor memory could also decrease,
placing further downward pressure on selling prices for the Company's
semiconductor memory products. The Company is unable to predict changes in
industry supply, major customer inventory management strategies, or end user
demand, which are significant factors influencing pricing for the Company's
semiconductor memory products.
The Company's operating results are significantly impacted by the operating
results of its consolidated subsidiaries, in particular MEI. As DRAM prices
have fallen and as unit shipments of PC systems have increased, MTI's
consolidated results of operations have been increasingly affected by MEI's
results of operations. MEI's past operating results have been, and its future
operating results may be, subject to fluctuations, on a quarterly and an annual
basis, as a result of a wide variety of factors, including, but not limited to,
inventory management or obsolescence, critical component availability,
industry competition, state sales and use taxes, short product cycles and the
timing of new product introductions by MEI and its competitors, fluctuating
market pricing for computer and semiconductor memory products, fluctuating
component costs, seasonal cycles common in the PC industry, seasonal government
purchasing cycles, reliance upon the direct sales approach, the ability to
maintain adequate customer service and technical support systems, the effect of
product reviews and industry awards, changes in product mix, manufacturing and
production constraints and the timing of orders from and shipments to OEM
customers.
The Company is engaged in ongoing efforts to enhance its production
processes to reduce the die size of existing products and to increase capacity.
The result of such efforts has led to a significant increase in recent quarters
in megabit production. There can be no assurance that the Company can maintain
or approximate increases in megabit production typical of that experienced in
recent quarters or that the Company will not experience decreases in
manufacturing yields or production as it attempts to implement future
technologies. Furthermore, from time to time, the Company experiences volatility
in its manufacturing yields, as it is not unusual to encounter difficulties in
ramping shrink versions of existing devices or new generation devices to
commercial volumes. The Company's ability to reduce per unit manufacturing costs
of its semiconductor memory products is largely dependent on its ability to
design and develop new generation products and shrink versions of existing
products and its ability to ramp such products at acceptable rates to acceptable
yields, of which there can be no assurance.
Historically, the Company has reinvested substantially all cash flow from
operations in capacity expansion and improvement programs. The Company's cash
flow from operations depends primarily on average selling prices and per unit
manufacturing costs of the Company's semiconductor products. In the event that
average selling prices decline faster than the rate at which the Company is able
to decrease per unit manufacturing costs, the Company may not be able to
generate sufficient cash flows from operations to sustain operations. There can
be no assurance that external sources of liquidity will be available to fund the
Company's operations or its capacity and product and process technology
enhancement programs. Failure to obtain financing would hinder the Company's
ability to make continued investments in such programs, which could materially
adversely affect the Company's business and results of operations.
The semiconductor industry has experienced a substantial amount of
litigation regarding patent and other intellectual property rights. In the
future, litigation may be necessary to enforce patents issued to the Company, to
protect trade secrets or know-how owned by the Company, or to defend the Company
against claimed infringement of the rights of others. The Company has from time
to time received, and may in the future receive, communications alleging that
the technology used by the Company in the manufacture of some or all of its
products may infringe on product or process technology rights held by others.
The Company has entered into a number of patent and intellectual property
license agreements with third parties, some of which require one-time or
periodic royalty payments. It may be necessary or advantageous in the future
for the Company to obtain additional patent licenses or to renew existing
license agreements, some of which expire at the end of the calendar year 1996.
The Company is unable to predict whether these license agreements can be
obtained or renewed on terms acceptable to the Company. Failure to obtain or
renew such licenses could result in litigation. Further, adverse determinations
that the Company's manufacturing processes or products have infringed on the
product or process rights held by others could result in the Company's loss of
proprietary rights,
10
<PAGE>
subject the Company to significant liabilities to third parties, require the
Company to seek licenses from third parties or require material changes in
production processes or products, any of which could have a material adverse
effect on the Company's business and results of operations.
Millenia TransPort is a trademark of Micron Electronics, Inc. Pentium is a
registered trademark of Intel Corporation.
11
<PAGE>
Part II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Shareholders
- -------------------------------------------------------
The registrant's 1996 Annual Meeting of Shareholders was held on November
18, 1996. At the meeting, the following items were submitted to a vote of the
shareholders:
(a) The following nominees for Directors were elected. Each person elected
as a Director will serve until the next annual meeting of shareholders or until
such person's successor is elected and qualified.
<TABLE>
<CAPTION>
Votes Votes Cast
Name of Nominee Cast For Against/Withheld
------------------------- ----------- ----------------
<S> <C> <C>
Steven R. Appleton 186,516,239 337,090
Jerry M. Hess 186,579,342 367,233
Robert A. Lothrop 186,435,596 510,048
Thomas T. Nicholson 186,581,034 371,640
Don J. Simplot 186,323,580 645,789
John R. Simplot 186,215,652 745,806
Gordon C. Smith 186,534,359 594,403
</TABLE>
(b) The ratification and appointment of Coopers & Lybrand L.L.P. as
independent public accountants of the Company for the fiscal year ending August
28, 1997 was approved with 186,357,583 votes in favor, 2,184,782 votes against,
837,599 abstentions and 0 broker non-votes.
12
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
(a) The following are filed as a part of this report:
Exhibit
Number Description of Exhibit
------- --------------------------------------------------
11 Computation of per share earnings for the quarters
ended November 28, 1996 and November 30, 1995
27 Financial Data Schedule
(b) The registrant did not file any reports on Form 8-K during the fiscal
quarter ended November 28, 1996.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Micron Technology, Inc.
--------------------------------------
(Registrant)
Dated: December 20, 1996 /s/ Wilbur G. Stover, Jr.
--------------------------------------
Wilbur G. Stover, Jr. Vice President
of Finance and Chief Financial Officer
(Principal Financial and Accounting
Officer)
14
<PAGE>
This Form 10-Q/A amends the Registrant's report on Form 10-Q in its entirety in
order to correct a technical electronic filing error.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report on Form 10-Q/A to be signed on its behalf
by the undersigned thereunto duly authorized.
Micron Technology, Inc.
--------------------------------------
(Registrant)
Dated: December 23, 1996 /s/ Wilbur G. Stover, Jr.
--------------------------------------
Wilbur G. Stover, Jr. Vice President
of Finance and Chief Financial Officer
(Principal Financial and Accounting
Officer)
15
<PAGE>
Exhibit 11
MICRON TECHNOLOGY, INC.
Computation of Per Share Earnings
(Amounts in millions except for per share data)
<TABLE>
<CAPTION>
November 28, November 30,
Quarter Ended 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
PRIMARY
Weighted average shares outstanding 209.1 206.7
Net effect of dilutive stock options 4.9 10.5
----- -----
Total shares 214.0 217.2
===== =====
Net income $ 20.6 $328.5
====== ======
Primary earnings per share $ 0.10 $1.51
====== =====
FULLY DILUTED
Weighted average shares outstanding 209.1 206.7
Net effect of dilutive stock options 5.4 10.5
----- -----
Total shares 214.5 217.2
===== =====
Net income $ 20.6 $328.5
====== ======
Fully diluted earnings per share $ 0.10 $ 1.51
====== ======
</TABLE>
16
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
ACCOMPANYING FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-28-1997
<PERIOD-END> NOV-28-1996
<CASH> 222
<SECURITIES> 6
<RECEIVABLES> 337
<ALLOWANCES> 21
<INVENTORY> 304
<CURRENT-ASSETS> 910
<PP&E> 3,644
<DEPRECIATION> 904
<TOTAL-ASSETS> 3,721
<CURRENT-LIABILITIES> 605
<BONDS> 306
0
0
<COMMON> 21
<OTHER-SE> 2,507
<TOTAL-LIABILITY-AND-EQUITY> 3,721
<SALES> 728
<TOTAL-REVENUES> 728
<CGS> 573
<TOTAL-COSTS> 687
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2
<INCOME-PRETAX> 39
<INCOME-TAX> 16
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 21
<EPS-PRIMARY> .10
<EPS-DILUTED> .10
</TABLE>
