Micron's free cash flow, margins, DRAM sales jump post-Elpida


In its first full quarter with Elpida on the books, Micron (MU) had FQ1 free cash flow of $838M, sharply above an FQ4 level of $385M and a big reversal from a year-ago level of -$302M. The increase came even though (thanks in part to Elpida) capex jumped to $669M (16.6% of revenue) from an FQ4 level of $332M.

Contributing to the cash flow jump: Gross margin rose to 32% from 25% in FQ4 and a mere 12% a year ago. Growing scale, healthy DRAM pricing (aided by the SK Hynix fire), and Elpida's mobile DRAM sales (mobile DRAM generally carries higher margins than PC DRAM) likely helped out..

The Elpida deal contributed to a 69% Q/Q increase in DRAM sales. NAND flash sales rose 8% Q/Q after growing 5% in FQ4, with an 11% volume increase offsetting a slight ASP decline.

While revenue rose 120% Y/Y to $4.04B, SG&A spend rose 48% to $176M, and R&D spend 43% to $320M. Micron had $5.8B in debt at the end of FQ1, to go with $4.4B in cash/investments.

MU +5.8% AH. NAND rival SanDisk (SNDK) +0.7%. CC at 4:30PM ET.

FQ1 results, PR

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Comments (16)
  • Clayton Rulli
    , contributor
    Comments (3393) | Send Message
     
    Eat your foot Cramer. MU up big . long
    7 Jan 2014, 04:39 PM Reply Like
  • Copious28
    , contributor
    Comments (442) | Send Message
     
    I cant wait to see what he has to say. He's been wrong all year.
    7 Jan 2014, 05:08 PM Reply Like
  • Barinder Sangha
    , contributor
    Comments (124) | Send Message
     
    Buy, buy, buy!
    7 Jan 2014, 05:09 PM Reply Like
  • 96815234
    , contributor
    Comments (1962) | Send Message
     
    $MU Wedbush calls MU earnings a "monster beat:" http://yhoo.it/KBl2C3
    7 Jan 2014, 06:21 PM Reply Like
  • 96815234
    , contributor
    Comments (1962) | Send Message
     
    Stock is now trading at $23 After Hours on its way to $30 btw...
    7 Jan 2014, 05:16 PM Reply Like
  • patt2374
    , contributor
    Comments (732) | Send Message
     
    The more questions senior management answer the more nervous I get.
    7 Jan 2014, 05:18 PM Reply Like
  • Copious28
    , contributor
    Comments (442) | Send Message
     
    They are doing pretty good so far. I agree though.
    7 Jan 2014, 05:21 PM Reply Like
  • Copious28
    , contributor
    Comments (442) | Send Message
     
    I am betting Phred is the first to publish!
    7 Jan 2014, 05:27 PM Reply Like
  • nautor42
    , contributor
    Comments (194) | Send Message
     
    Lot of shorts out there for 01/24. They ought to be scrambling to reduce losses tomorrow.
    7 Jan 2014, 05:37 PM Reply Like
  • 13302632
    , contributor
    Comments (1772) | Send Message
     
    Its good going the opposite of the "conventional" (wrong) wisdom. I have a big long holding but after stupid analyst downgrades before earnings and short sellers hitting it, I bought 1 week call options to get the earnings action. It's a nice double+ up at the short sellers expense.
    7 Jan 2014, 06:10 PM Reply Like
  • JLittleton35
    , contributor
    Comments (4) | Send Message
     
    Thanks Russ! Those $23 Jan calls I got for a dime are looking really good now :-) Thanks again Russ(Micron Ninja)!
    7 Jan 2014, 07:57 PM Reply Like
  • hneumann
    , contributor
    Comments (630) | Send Message
     
    "Stock is now trading at $23 After Hours on its way to $30 btw..."

     

    $ 30 not this quarter.
    7 Jan 2014, 08:13 PM Reply Like
  • janeksh
    , contributor
    Comments (17) | Send Message
     
    Sorry, Russ, I meant insight.
    7 Jan 2014, 09:06 PM Reply Like
  • janeksh
    , contributor
    Comments (17) | Send Message
     
    OMG, Russ

     

    I doubled my In the money calls for February and April after your piece. Didn't have the nerve to test January calls. I appreciate your incite, as always. A new Audi is in order :)
    7 Jan 2014, 09:07 PM Reply Like
  • Plexander
    , contributor
    Comments (11) | Send Message
     
    Cramer didn't say a word about MU. This is just too big to ignore! There may be a hint why in the fine print at the bottom of his articles... "Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast."

     

    He's keeping his legal options open to BUY, BUY, BUY!!!
    7 Jan 2014, 09:43 PM Reply Like
  • starkeelectricinc@yahoo.com
    , contributor
    Comment (1) | Send Message
     
    I am an electrical contractor.Trading on my own for about seven years. Russ,RSA and ElectricPhred our now my heros.They provided excellent information for the little guy ,like me.I would not mind to have a paying servjce with them.Thank you .
    7 Jan 2014, 10:27 PM Reply Like
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