Micron Technology Inc. reported record sales and fat profits Tuesday, reaping benefits from diversification and cost-cutting efforts as worldwide prices and demand for its memory products rise. But the company also began notifying a few hundred Boise workers that their jobs will end as most of their work is shipped to a Micron plant in Taiwan.
The Boise company reported $20.3 billion in revenue for the fiscal year that ended Aug. 31, a 64 percent increase from one year ago. Its net income totaled $5.1 billion, compared with a $276 million loss a year ago.
Micron also reported results for its latest quarter. They were even stronger: $6.1 billion in sales, a 91 percent increase; and net income of $2.4 billion, compared with a $170 million loss in the same quarter a year ago.
In a conference call with investment analysts, President and CEO Sanjay Mehrotra said the results reflect in part Micron’s focus on making its costs more competitive and developing “high-value” memory products. That focus will persist, because “these things don’t happen overnight,” he said.
What he did not say was that the emphasis on cost-competitiveness includes job cuts. The company declined to say how many people would be affected. A source with knowledge of the cuts who declined to be identified said the number is in the low hundreds.
Micron lost most of its Boise manufacturing jobs over several years in the late 2000s as it phased out the making of the round wafers from which memory chips are cut. But Boise kept some so-called back-end jobs, in which wafers brought to Boise from other Micron plants are cut and prepared for use on circuit boards, then shipped out again.
Those jobs are expected to be phased out over the next 18 months. Some of the affected workers may land other Micron jobs in Boise or at manufacturing plants in Utah and Virginia.
A small number of finance jobs will be outsourced, too.
Asked about the cuts, Micron spokesman Marc Musgrove emailed this statement:
“Micron's mission is to be a global leader in memory and storage solutions. To achieve this requires continued innovation and the ability to deliver solutions to our global customers quickly and efficiently. For this reason, Micron is establishing manufacturing, technology and business centers of excellence that will streamline processes, optimize our global footprint and ensure we use the talents of our team and our resources as effectively as possible.”
Micron employs 6,800 people in Boise, making it the biggest for-profit employer in the Treasure Valley and Idaho’s largest publicly traded company. It employs an additional 28,000 people in factories and offices around the world.
Mehrotra previously said the Boise headquarters would be Micron’s primary center of excellence for research and development. R&D jobs have accounted for much of Micron’s Boise job growth in the past few years. He told the Statesman in July that he expects the staff size in Boise to keep growing as Micron hires engineers to expand the company’s role in artificial intelligence, machine learning and other areas.
Meanwhile, the company is prospering as smartphones and big data centers require ever more memory.
“Micron delivered exceptional fourth quarter and fiscal year results, reflecting solid execution and robust demand for our memory and storage solutions,” Mehrotra said in a news release about Tuesday’s earnings. “We expect healthy industry fundamentals to continue into 2018.”
The fiscal quarter that ended Aug. 31 is the first full quarter since Mehrotra, (meh-RO-truh), 59, succeeded Mark Durcan as CEO in May.
A year earlier, Mehrotra left SanDisk, a Micron competitor that he co-founded in the Bay Area. SanDisk was sold to Western Digital, a hard-drive maker.
Micron shares closed at $34.18 Tuesday, then rose to $35.31 in light after-hours trading that followed the earnings announcement. The stock price has more than doubled since last October and is near its five-year high of $35.95 in November 2014.