Sanjay Mehrotra is a star in Silicon Valley, but he is mostly unknown in Idaho.
When Mehrotra, the new president and CEO of Micron Technology Inc., introduced himself to the state July 27 at a Boise Metro Chamber of Commerce luncheon, the chamber board member who presented him struggled with his last name. (It’s pronounced meh-RO-truh.) Idahoans outside Micron have seen little of Mehrotra since.
Inside Micron, it’s a different story. Mehrotra rallies his troops in meetings that sometimes include hundreds of people at Micron’s headquarters at 8000 S. Federal Way. He travels the globe, visiting customers and getting to know Micron’s people at plants in Singapore, Taiwan, Japan and Virginia, and dozens of offices in Europe, the U.S. and Asia.
Day by day, he spreads his message to Micron’s 35,000 employees like an evangelist: We have great talent. We have great technology. The world needs us, and we have worldwide reach. The future is ours. But we are not meeting our potential. We must curb our production costs. We must deliver the memory products our customers want, and we must do it faster.
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Mehrotra is charging hard, stepping up the pace at the Treasure Valley’s largest for-profit employer, which is Idaho’s biggest publicly traded company and the second-largest semiconductor manufacturer in America after Intel Corp.
It’s the latest mission for a man whose middle-class Indian father saw great potential in his son.
Dad didn’t take no for an answer
When Mehrotra was 18, he went with his father to the American embassy in New Delhi, India, to get a visa. Mehrotra had just finished two years of college, studying engineering. His father thought Sanjay deserved the best engineering education possible and should continue his studies in the United States.
But the embassy would not grant the visa.
As Mehrotra, 59, tells the story, the embassy turned him down three times. His father took him along that day to confront the officer who kept saying no. They waited until the officer returned from lunch, then pounced.
“My father was a very dynamic person,” Mehrotra told an Indian college audience last year. “Very aggressive, very articulate. My dad was very upset at that time, very angry, and he basically for 20 minutes just blasted the [officer]. How can he deny me an opportunity to go to the U.S. to study in one of the top institutions, University of California Berkeley?”
The officer gave in. “Give me the passport,” he told Mehrotra’s father. Then he stamped it.
The incident made a deep impression on Mehrotra, who is now an American citizen. He cites it as a lesson in the power of tenacity. “That was a performance of a lifetime for me to watch,” he said. “That really absolutely changed my life.”
It set in motion a chain of events that led Mehrotra to a leadership role in America’s semiconductor industry.
He cofounded, later led, and last year sold SanDisk, a Milpitas, California, flash-memory maker best known for the tiny USB memory cards and thumb drives that hold gigabytes of data and sell for a few dollars each at retail stores.
When Micron CEO Mark Durcan announced in February that he would retire, a headhunter approached Mehrotra about coming out of retirement to succeed him. Micron’s board reviewed more than 50 candidates and interviewed at least 15. Mehrotra won the job.
‘He was everything I was looking for’
Mehrotra’s father, now deceased, represented the domestic cotton industry to the national government. He saw his son’s aptitude in math, his curiosity about how things worked. But he earned too little to put children through college abroad, his son said.
So when Sanjay traveled to Berkeley to study engineering, he relied for support first on his older brother and later on scholarships and part-time work. His brother was an engineer, too, and he had also emigrated to the U.S.
“All of a sudden, becoming totally independent, supporting myself and adapting to the new culture, as well as a new education system, certainly did require a lot of adjustment,” Mehrotra told the Idaho Statesman.
But he made friends, became a fan of the Bears, Cal’s football team, earned his bachelor’s degree in 1978 and stuck around for a master’s in 1980. While writing his thesis in process technology, Mehrotra thought: This is not what I want to do for my career. I want to design integrated circuits, not structure processes for producing them.
The events that followed illustrate how immigrants with intelligence, aptitude and drive contribute to contemporary American society.
George Perlegos, a Greek immigrant who worked for Intel in Silicon Valley, was impressed by Mehrotra while on a recruiting trip to campus. Perlegos hired him in 1980 to design 64-kilobyte programmable, erasable memory chips. They were called “nonvolatile” because they held on to their data when the power supply was turned off, unlike dynamic random-access memory chips, which need steady jolts of electricity to function. “He knew the technology,” Perlegos said. “He was smart. He was aggressive. He was everything I was looking for.”
In 1981, Perlegos left Intel to start his own company. He recruited Mehrotra. They kept building upon their Intel work. A few years later, after Mehrotra got married in India and Perlegos started a second company, Mehrotra went to work for him a third time.
In 1988, Mehrotra was approached by Eli Harari, an engineer who had met him at Intel. Harari, an Israeli immigrant, wanted to start a company to take nonvolatile memory – better known as flash — out of the laboratory and into the marketplace.
Flash was well-suited for storing data. Harari needed someone who could design circuits. Mehrotra, who had been steadily helping to advance flash technology (he holds more than 70 patents), was well-suited for Harari’s needs.
Harari, Mehrotra and Taiwanese immigrant Jack Yuan, a semiconductor process technologist, founded SanDisk.
SanDisk rises, then sells for ‘a nice price’
Today, flash memory is everywhere – in mobile phones, where it stores videos and pictures; and in notebook computers, where its solid-state drives allow longer battery life and smaller, sleeker designs than the spinning hard drives traditionally used for storing data. Flash is a $35 billion-a-year global industry. In 1988, it was new and little known.
At first the three pioneers made solid-state drives. But they were expensive: A 20-megabyte hard-drive substitute cost $1,000, or $50 per megabyte. There were few buyers.
So the men refocused, making imaging cards to store pictures on cameras. In the early 1990s, as digital photography grew, SanDisk worked with Kodak, Polaroid, Canon and Nikon to design and standardize this so-called digital film. The business took off, becoming what Mehrotra called SanDisk’s “first megamarket.”
SanDisk went on to make flash for USB drives, then audio players, then mobile phones. When Harari retired in 2010, Mehrotra took over. The cost of flash memory was falling fast. But instead of crashing the business, the plunging prices, made possible by advancing technology, opened doors to new markets. Mehrotra kept SanDisk’s consumer business but focused on pushing into cloud computing.
Four hundred miles south, in Irvine, Western Digital had been making hard drives since the 1970s. By the 2010s, hard-drive sales sagged as solid-state drives took hold. To grow again, Western Digital needed flash. In 2016, it bought SanDisk for $16 billion.
“A very nice price,” said Mark Durcan, then Micron’s CEO.
Mehrotra is proud of the sale but considers it bittersweet. “I was definitely ready for a break, because the 28 years at SanDisk were absolutely like being on a treadmill that just kept getting faster and faster,” he said. But he added: “It is like your baby that you have raised. And of course, adults, at some point, you have to let go. But I feel very good for the overall outcome for SanDisk.”
He added: “Taking that break gave me time to think about ‘what do I truly want to do next?’”
Micron comes calling
Durcan, who had been former CEO Steve Appleton’s No. 2, had just announced his plan to retire when Appleton died in 2012 in the crash at the Boise Airport of a small plane he was flying solo. Durcan rescinded his resignation, took over as CEO and stayed until last May, retiring at 56.
Micron is a bigger, more complex company than SanDisk. Its revenues are three times SanDisk’s. It makes both flash memory — which makes Micron a direct competitor of SanDisk – and dynamic random-access memory, or DRAM (DEE-ram). It has about 6,800 employees in Boise, where most of its products are researched and developed.
The worldwide memory business has been tough for decades, operating in a commodity-like market where prices climb to euphoric highs and plunge to depressing lows. Oversupply plagues the industry as makers simultaneously ramp up output at high prices but keep producing at low ones to avoid even more costly production shutdowns. Once IBM, Texas Instruments, Motorola, Intel and others made DRAM in the United States. Today Micron is the only surviving U.S. DRAM manufacturer and one of only three worldwide. (The others are Korean: Samsung, the market leader, and SK Hynix.)
The cycle has moderated over the years as manufacturers have consolidated. Micron took over Japan’s Elpida Memory in 2013 and Taiwan’s Inotera Memories last year. But the market could grow harsher again as China moves to build its own semiconductor industry.
For now, Micron is a record-setting success. The fiscal year that ended in August brought fat profits and Micron’s highest revenue ever: $5.1 billion in net earnings on sales of $20.3 billion. Mehrotra started in May, and the profitable quarter that ended in August mostly reflected decisions made before he arrived, but it was the first on his watch.
Micron’s stock is up almost 60 percent since mid-August. Shares have traded in recent days at their highest levels since early 2001. The stock closed Friday at $45.33.
Problems and job cuts
But Micron has problems. Its DRAM production costs are high. It is sluggish getting some products to market. Mehrotra said its flash technology is the industry’s least expensive, an important advantage, but is not being applied to full effect to meet customers’ needs. While Micron has talked for years about offering “high value solutions” that command higher prices than commodity chips, Mehrotra said the company needs to offer more, and faster.
“We want to strengthen execution so that the products we bring to the market are the products our customers absolutely desire and consider to be the best in class,” he said. “We want to bring these products ‘on time, one time and every time.’ That means bring it on schedule, do it right the first time, and make sure you repeat this process in everything we do.”
The changes can be painful. On the September day when Micron released its glowing earnings report, it also acknowledged that it had started telling a few hundred Boise workers their jobs would end, their work moved to Taiwan.
Micron lost many of its Boise manufacturing jobs in the 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, cutting wafers made in other plants and preparing them for use on circuit boards. Now those jobs are being phased out, too, as are some finance jobs.
But Mehrotra said he expects Micron’s overall employment in Boise to rise as the Federal Way campus’ research and development roles grow.
Durcan stayed on until August to help Mehrotra. The two men are on “friendly speaking terms,” Durcan said, but they have spoken only once since August, in a brief call. Mehrotra is following his own light now.
“He’s very busy getting out around the world,” Durcan said. “He’s obviously a strong leader, with a lot of balls in the air.”
The pace accelerates, the pressure rises
Micron’s top executives are having to adjust.
Wayne Allan, Micron’s senior vice president of global manufacturing, noted that Mehrotra is the first CEO to come from outside Micron in its 39-year history. “I have learned that with a strong team, you can be great at certain important aspects of the business and still be weaker in other areas that may not be as transparent to those of us working on the same team for many years,” he said in an email. “Sanjay has driven an immediate and intense focus” on improvement.
April Arnzen, senior vice president of human resources, said Mehrotra and Durcan share traits: They are engineers at heart, care for people and community, and have “tremendous business intellect.” But where Durcan was measured in decision-making, Mehrotra conveys urgency.
“When he has a thought or question, he wants to discuss immediately,” Arnzen said. She gets after-hours texts and calls from the boss. “I am pretty sure he never sleeps,” she said.
Mehrotra has a sense of humor. Arnzen said her daughter inadvertently replied to a text message from Mehrotra, telling him they were going shopping — a message meant for Arnzen’s husband. “Sanjay replied seconds later with his shopping list,” she said.
All in the engineering family
Mehrotra said he and his wife, Sangeeta, want to rent a house in Boise but have yet to find one. They still live in Silicon Valley and have a second home in Half Moon Bay on the Pacific Coast.
When he’s not traveling, Mehrotra works at Micron’s headquarters in Boise or its office in Milpitas, a mile from SanDisk’s former headquarters. He said he spends more time here than there. He had never spent a day in Boise until he started the job.
“I like Boise, the Downtown restaurants and bars,” he told the chamber of commerce. “What I like most here is the commute. The people are very nice as well. Thank you for making Boise such a welcoming city, a charming city.”
He insists his family is his top priority but acknowledges that the work consumes him: “I do tend to be one of those that is a little bit 24/7 thinking about Micron, OK?”
Mehrotra’s brother and two sisters are engineers, and now his two daughters are too. Both are Stanford engineering graduates working in Silicon Valley. They are product managers — one at Facebook, the other at Digit, a San Francisco financial-technology startup.
He said he has put SanDisk behind him. But he is bringing former SanDisk lieutenants to Micron.
On Oct. 16, Manish Bhatia became executive vice president of global operations. Bhatia works in an office next to Mehrotra’s.
Micron also hired Anana Jayapalan in August to oversee the company’s storage-business unit. (Six weeks after he started, Jayapalan was sued by the Securities and Exchange Commission, which accused him of sharing SanDisk insider information three years ago that profited family members. Micron said Sunday that he has resigned.)
“Our goal is to have a mix of talent ... top talent from within and, as needed, from outside as well,” Mehrotra said. “We will absolutely have the right mix. It’s not at all about SanDisk.”
Scott DeBoer, Micron’s executive vice president of technology development, said he was impressed with Mehrotra’s focus on technological excellence from the first day, half of which Mehrotra spent with DeBoer’s leadership team. “Sanjay has demonstrated tremendous vision,” he said.
‘There’s a lot more to be captured in this company’
Mehrotra receives a $1.2 million yearly base salary and $1.8 million more if he reaches the board’s performance targets. But most of his compensation will be equity in the company: He will collect $4.6 million in stock for the fiscal year that ended in August, at least $10 million for fiscal 2018, and $9 million as a new-hire inducement award. The stock awards vest over three to four years.
Asked in an interview if he intends to make Micron his last job before retiring, Mehrotra looked surprised. He just wants to help Micron meet its full potential, he said: “There’s a lot more to be captured in the company, and it just has amazing capabilities in place.”
And how does he want to be remembered? “Oh, my goodness. I don’t think about that. I’m just totally focused and driven, and excited about the change that is happening in the world today, and how technology is influencing and enriching our lives.”
He paused, then added: “The legacy I would like to definitely leave is first to be a good person, good parent, good family member. I think that’s most important. And then to have impacted the world with technologies and solutions that the companies that I have been involved with bring to the world.”
So far, Durcan thinks Mehrotra is doing fine. “The last thing you want is to have the old guy looking over the new guy’s shoulder,” Durcan said. “But I will say he hasn’t done anything that concerns me.”
Perlegos, Mehrotra’s old Intel boss, is more pointed. “He will help the company quite a bit,” he said. “Sanjay is ready for the sky.”