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Micron swings to profit on strong memory chip sales

Dec. 22, 2009, 4:24 p.m. EST

SAN FRANCISCO (MarketWatch) -- Micron Technology Inc. on Tuesday swung to a profit as the company posted strong sales of memory processors.

Shares of Micron /quotes/comstock/13*!mu/quotes/nls/mu (MU 9.58, +0.17, +1.81%) rose about 3% in after-hours trading after the Boise, Idaho-based chip maker reported a fiscal first-quarter profit of $204 million, or 23 cents a share, compared with a loss of $718 million, or 93 cents a share, for the year-earlier period. Revenue was $1.7 billion, up from $1.4 billion for the same quarter the previous year.

Analysts had expected the Boise, Idaho-based chip maker to report earnings of 6 cents a share on revenue of $1.6 billion, according to a consensus survey by FactSet Research.

Micron said revenue from its DRAM products rose 50% from the previous quarter, while sales of NAND Flash products rose 21% sequentially, both due to higher sales volumes and average selling prices.

DRAM chips are typically found in personal computers, while NAND Flash processors are used in such devices as digital cameras and mp3 music players.

The chip industry had been reeling from a glut in memory chip products, which has led to declining average selling prices.

In a prepared statement, Chief Executive Steve Appleton said "there are still challenges in the global economy" but he also noted "improving market conditions."