Micron Technology has made significant reductions to Capex and now expects fiscal 2023 Capex to be around $8 billion, down more than 30 percent year over year.
Boise, Idaho-based Micron said it would reduce wafer fabrication equipment investments by 50 percent in the new fiscal year.
Micron Technology CEO Sanjay Mehrotra said: “We are taking steps to reduce our supply growth including a nearly 50 percent wafer fab equipment Capex cut versus last year, and we expect to emerge from this downcycle well positioned to capitalize on the long-term demand for memory and storage.”
Micron revealed that its investments in capital expenditures were $3.58 billion for the fourth quarter of 2022 and $11.98 billion for the full year of 2022.
Micron forecast strong revenue growth in the second half of fiscal 2023 as demand starts to recover early next year.
Micron forecast first-quarter revenue of $4.25 billion, plus or minus $250 million. Adjusted revenue for the quarter ended Sept. 1 was $6.64 billion versus $8.64 billion for the prior quarter and $8.27 billion for the same period last year.
Profit outlooks were also grim at 4 cents per share, plus or minus 10 cents. Fourth-quarter earnings were $1.45 per share.
Micron reported fiscal 2022 revenue of $30.76 billion versus $27.71 billion for the prior year with net income of $8.69 billion, or $7.75 per diluted share.
Phone brands including Apple have driven down their production volume targets, which compounded the challenges for Micron, said Richard Barnett, chief marketing officer of Supplyframe, a supply chain solutions provider.
Micron has adjusted down its sales outlook for PCs and smartphones by several percentage points in the last few months, Sumit Sadana, Micron’s chief business officer, said. PC sales in calendar 2022 will drop by a high teen percentage range from last year and smartphone sales will be down by a high single-digit percentage range, he said.