Micron Technology, Inc. Reports Results for the Fourth Quarter and Full Year of Fiscal 2020
September 29, 2020
DRAM portfolio strengthened with 1z ramp; High-value NAND shipments reach record levels in FY20
BOISE, Idaho, Sept. 29, 2020 (GLOBE NEWSWIRE) -- Micron Technology, Inc. (Nasdaq: MU) today announced results for its fourth quarter and fullyear of fiscal 2020, which ended Sept. 3, 2020.
Fiscal Q4 2020 highlights

Revenue of $6.06 billion versus $5.44 billion for the prior quarter and $4.87 billion for the same period last year
GAAP net income of $988 million, or $0.87 per diluted share
Non-GAAP net income of $1.23 billion, or $1.08 per diluted share
Operating cash flow of $2.27 billion versus $2.02 billion for the prior quarter and $2.23 billion for the same period last year
Fiscal 2020 highlights

Revenue of $21.44 billion versus $23.41 billion for the prior year
GAAP net income of $2.69 billion, or $2.37 per diluted share
Non-GAAP net income of $3.24 billion, or $2.83 per diluted share
Operating cash flow of $8.31 billion versus $13.19 billion for the prior year
“Micron delivered solid fiscal fourth quarter revenue and EPS resulting from strong DRAM sales in cloud, PC and gaming consoles and an
extraordinary increase in QLC NAND shipments,” said Micron Technology President and CEO Sanjay Mehrotra. “We look forward to improving market
conditions throughout calendar 2021, driven by 5G, cloud and automotive growth, and we are excited by the continued momentum in our productportfolio.”
Quarterly Financial Results
GAAP(1)(in millions, except per share amounts)
Revenue
Gross margin
percent of revenue
Operating expenses
Operating income
percent of revenue
Net income attributable to Micron
Diluted earnings per share

FQ4-20$6,056 $
2,068
34.1 %
911
1,157
19.1 %
988
0.87

Non-GAAP(2)FQ3-20

FQ4-195,438 $
1,763
32.4 %
875
888
16.3 %
803
0.71

FQ4-20

4,870
$
1,395
28.6 %
745
650
13.3 %
561
0.49

6,056 $
2,111
34.9 %
809
1,302
21.5 %
1,229
1.08

FQ3-20

FQ4-195,438 $
1,804
33.2 %
823
981
18.0 %
941
0.82

4,870
1,491
30.6 %
797
694
14.3 %
637
0.56

Annual Financial Results
GAAP(1)(in millions, except per share amounts)
Revenue
Gross margin
percent of revenue
Operating expenses
Operating income
percent of revenue
Net income attributable to Micron
Diluted earnings per share$

Non-GAAP(2)

FY 20

FY 19

FY 20

FY 19

21,435 $6,552
30.6 %
3,549
3,003
14.0 %
2,687
2.37

23,406$
10,70245.7 %
3,326
7,376
31.5 %
6,313
5.51

21,435 $6,718
31.3 %
3,299
3,419
16.0 %
3,235
2.83

23,406
10,97346.9 %
3,172
7,801
33.3 %
7,314
6.35

Investments in capital expenditures, net(2) were $2.16 billion for the fourth quarter of 2020 and $7.95 billion for the full year of 2020, which resulted inadjusted free cash flows(2) of $111 million for the fourth quarter of 2020 and $361 million for the full year of 2020. Micron repurchased approximately
824,000 shares of its common stock for $41 million during the fourth quarter of 2020 and 3.6 million shares of its common stock for $176 million during
the full year of 2020 and ended the year with cash, marketable investments, and restricted cash of $9.26 billion, for a net cash(2) position of $2.61
billion.

Business Outlook
The following table presents Micron’s guidance for the first quarter of 2021:
GAAP(1) Outlook

Non-GAAP(2) Outlook$5.2 billion ± $200 million
26.5% ± 1%$873 million ± $25 million$37 million$0.39 ± $0.07$5.2 billion ± $200 million
27.5% ± 1%$825 million ± $25 million$35 million$0.47 ± $0.07

FQ1-21
Revenue
Gross margin
Operating expenses
Interest (income) expense, net
Diluted earnings per share

Further information regarding Micron’s business outlook is included in the prepared remarks and slides, which have been posted atinvestors.micron.com.
Investor Webcast
Micron will host a conference call on Tuesday, Sept. 29, 2020 at 2:30 p.m. MT to discuss its fourth quarter financial results and provide forward-looking
guidance for its first quarter. A live webcast of the call will be available online at investors.micron.com. A webcast replay will be available for one year
after the call. For Investor Relations and other company updates, follow @MicronTech on Twitter at twitter.com/MicronTech.
About Micron Technology, Inc.
We are an industry leader in innovative memory and storage solutions. Through our global brands — Micron® and Crucial® — our broad portfolio of
high-performance memory and storage technologies, including DRAM, NAND, 3D XPoint™ memory, and NOR, is transforming how the world uses
information to enrich life for all. Backed by more than 40 years of technology leadership, our memory and storage solutions enable disruptive trends,
including artificial intelligence, 5G, machine learning, and autonomous vehicles, in key market segments like mobile, data center, client, consumer,
industrial, graphics, automotive, and networking. Our common stock is traded on Nasdaq under the MU symbol. To learn more about Micron
Technology, Inc., visit micron.com.
Micron and the Micron orbit logo are trademarks of Micron Technology, Inc. All other trademarks are the property of their respective owners.
Forward-Looking Statements
This press release contains forward-looking statements regarding the industry, our strategic position, and our financial and operating results. These
forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially. Please refer to the
documents we file with the Securities and Exchange Commission, specifically our most recent Form 10-K and Form 10-Q. These documents containand identify important factors that could cause our actual results to differ materially from those contained in these forward-looking statements. Thesecertain factors can be found at www.micron.com/certainfactors. Although we believe that the expectations reflected in the forward-looking statements
are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We are under no duty to update any of theforward-looking statements after the date of this release to conform these statements to actual results.
(1)

GAAP represents U.S. Generally Accepted Accounting Principles.

(2)

Non-GAAP represents GAAP excluding the impact of certain activities, which management excludes in analyzing our operating results andunderstanding trends in our earnings, adjusted free cash flow, net cash, and business outlook. Further information regarding Micron’s use of
non-GAAP measures and reconciliations between GAAP and non-GAAP measures are included within this press release.

MICRON TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS(In millions, except per share amounts)(Unaudited)
4th Qtr.
September 3,
2020
Revenue
Cost of goods sold
Gross margin
Selling, general, and administrative
Research and development
Other operating (income) expense, net
Operating income
Interest income
Interest expense
Other non-operating income (expense), net$

3rd Qtr.
May 28,2020

4th Qtr.
August 29,
2019Year Ended
September 3,
August 29,
2020
2019

6,056 $
3,988

5,438 $
3,675

4,870 $
3,475

21,435 $14,883

23,406
12,704

2,068

1,763

1,395

6,552

10,702

231
630
50

216
649
10

212
623
(90)

881
2,600
68

836
2,441
49

1,157

888

650

3,003

7,376

13
(50)
5

23
(51)
10

57
(39)
(13)

114
(194)
60

205
(128)
(405)

Income tax (provision) benefit
Equity in net income (loss) of equity method investees
Net income

Earnings per share
Basic
DilutedNumber of shares used in per share calculations
Basic
Diluted

870

655

2,983

7,048

(136)
1

(68)
3

(71)
2

(280)
7

(693)
3

990

805

586

2,710

6,358

(2)

(2)

(25)

(23)

(45)

$

988 $

803 $

561 $

2,687 $

6,313$

0.89 $
0.87

0.72 $
0.71

0.51 $
0.49

2.42 $
2.37

5.67
5.51

1,111
1,131

1,111
1,129

1,104
1,128

1,110
1,131

1,114
1,143

Net income attributable to noncontrolling interests
Net income attributable to Micron

1,125

MICRON TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS(In millions)(Unaudited)
September 3,
2020

As of
AssetsCash and equivalents
Short-term investments
Receivables
Inventories$

May 28,2020

August 29,
20197,624 $
518
3,912
5,607
304

8,267 $
391
3,603
5,405
233

7,152
803
3,195
5,118
235

17,965
1,048
31,031
334
707
1,228
584
781

17,899577
30,081
332
775
1,228
599
514

16,503
1,164
28,240
340
837
1,228
—
575

$

53,678 $52,005 $48,887$

5,817 $
270
548

5,364 $
330
491

4,626
1,310
454

Other noncurrent liabilities

6,635
6,373
533
643
498

6,185
6,356
540
553
453

6,390
4,541
—
636
452

Total liabilities

14,682

14,087

12,019

—

98

98

119
8,917
33,384

119
8,764
32,402

118
8,214
30,761Other current assets
Total current assets
Long-term marketable investments
Property, plant, and equipment
Intangible assets
Deferred tax assets
Goodwill
Operating lease right-of-use assets
Other noncurrent assets
Total assets
Liabilities and equity
Accounts payable and accrued expenses
Current debt
Other current liabilities
Total current liabilities
Long-term debt
Noncurrent operating lease liabilities
Noncurrent unearned government incentives

Commitments and contingencies
Redeemable noncontrolling interest
Micron shareholders’ equity
Common stock
Additional capital
Retained earnings

Treasury stock
Accumulated other comprehensive income (loss)
Total Micron shareholders’ equity
Noncontrolling interest in subsidiary
Total equity$

Total liabilities and equity(3,495)71(3,454)(11)(3,221)
9

38,996—37,820—35,881
889

38,99637,82036,77053,678 $52,005 $48,887

MICRON TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions)(Unaudited)
September 3,
2020

For the year ended
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation expense and amortization of intangible assets
Amortization of debt discount and other costs
Stock-based compensation(Gain) loss on debt prepayments, repurchases, and conversions
Change in operating assets and liabilities
Receivables
Inventories
Accounts payable and accrued expenses
Deferred income taxes, net$

August 29,
2019

2,710 $

6,358

5,650
26
328
(40)

5,424
49
243
396

Other

(723)
(489)
725
79
40

2,431
(1,528)
(174)
150
(160)

Net cash provided by operating activities

8,306

13,189(8,223)(1,857)
1,458
814
262
(43)

(9,780)(4,218)
1,504
1,541
748
120

(7,589)(10,085)(4,366)
(744)
(251)
(63)
5,000
225
(118)

(3,340)—(2,729)
(75)
3,550
179
(23)

(317)

(2,438)

11

26

411
7,279

692
6,587

7,690 $

7,279

Cash flows from investing activities
Expenditures for property, plant, and equipment
Purchases of available-for-sale securities
Proceeds from sales of available-for-sale securities
Proceeds from maturities of available-for-sale securities
Proceeds from government incentives
Other
Net cash provided by (used for) investing activities
Cash flows from financing activities
Repayments of debt
Acquisition of noncontrolling interest in IMFT
Payments to acquire treasury stock
Payments on equipment purchase contracts
Proceeds from issuance of debt
Proceeds from issuance of stock
Other
Net cash provided by (used for) financing activities
Effect of changes in currency exchange rates on cash, cash equivalents, and restricted cash
Net increase (decrease) in cash, cash equivalents, and restricted cash
Cash, cash equivalents, and restricted cash at beginning of period
Cash, cash equivalents, and restricted cash at end of period

MICRON TECHNOLOGY, INC.
NOTES
(Unaudited)$Property, Plant, and Equipment
We periodically assess the estimated useful lives of our property, plant, and equipment. Based on our assessment of planned technology nodetransitions, capital spending, and re-use rates, we revised the estimated useful lives of the existing equipment in our NAND wafer fabrication facilities
and our research and development facilities from five years to seven years as of the beginning of the first quarter of 2020. This revision reduced ouraggregate depreciation expense by approximately $675 million in 2020, of which approximately $165 million remained capitalized in inventory as ofthe end of 2020. Adjusting for the effect of the reduced amount of depreciation expense remaining in inventory, the revision in estimated useful lives
benefited both operating income and net income by approximately $150 million and diluted earnings per share by approximately $0.13 for the fourth
quarter of 2020, and benefited both operating income and net income by approximately $510 million and diluted earnings per share by approximately$0.45 for 2020.
Adoption of Lease Accounting Standard
In the first quarter of 2020, we adopted ASU 2016-02 – Leases (as amended, “ASC 842”), which amends a number of aspects of lease accounting,including requiring lessees to recognize operating leases with a term greater than one year on their balance sheet as a right-of-use asset andcorresponding lease liability, measured at the present value of lease payments. In adoption, we applied the modified retrospective method and elected
to not recast prior periods. As a result, we recognized $567 million for operating lease liabilities and right-of-use assets and reclassified an additional$66 million of other balances to right-of-use assets to conform to the new presentation requirements of ASC 842.

MICRON TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES(In millions, except per share amounts)
4th Qtr.
September 3,
2020
GAAP gross margin
Stock-based compensation
Start-up and preproduction costs
Employee severance

3rd Qtr.
May 28,2020

4th Qtr.
August 29,
2019Year Ended
September 3,
August 29,
2020
2019

$

2,068 $
37—
(1)
7

1,763 $
34——
7

1,395 $
291247
86,552 $
139——
27

10,702
102
58
73
38

Non-GAAP gross margin$

2,111 $

1,804 $

1,491 $

6,718 $

10,973

GAAP operating expenses
Stock-based compensation
Employee severance
Restructure and asset impairments

$

911 $
(52)
—
(50)
—

875 $
(48)
—
(4)
—

745 $
(38)
(32)
122
—

3,549 $
(189)
—
(60)
(1)

3,326
(141)
(43)
32
(2)

Non-GAAP operating expenses

$

809 $

823 $

797 $

3,299 $

3,172

GAAP operating income
Stock-based compensation
Start-up and preproduction costs
Employee severance
Restructure and asset impairments$

1,157 $
89
—
(1)
50
7

888 $
82
—
—
4
7

650 $
67
12
79
(122)
8

3,003 $
328
—
—
60
28

7,376
243
58
116
(32)
40

Non-GAAP operating income$

1,302 $

981 $

694 $

3,419 $

7,801

GAAP net income attributable to Micron
Stock-based compensation
Start-up and preproduction costs
Employee severance
Restructure and asset impairments
Amortization of debt discount and other costs(Gain) loss on debt repurchases and conversions
Other
Estimated tax effects of above, non-cash changes in
net deferred income taxes, assessments of tax
exposures, and impact of U.S. income tax reform

$

988 $
89
—
(1)
50
6
—
7

803 $
82
—
—
4
4
2
7

561 $
67
12
79
(122)
10
10
13

2,687 $
328
—
—
60
26
(40)
28

6,313
243
58
116
(32)
49
396
57

90

39

7

146

114

Non-GAAP net income attributable to Micron$

1,229 $

941 $

637 $

3,235 $

7,314

1,131

1,143

Other

Other

Other

GAAP weighted-average common shares outstanding- Diluted

1,131

1,129

1,128

Adjustment for stock-based compensation and capped
calls
Non-GAAP weighted-average common shares
outstanding - Diluted
GAAP diluted earnings per share

11

13

6

10

7

1,142

1,142

1,134

1,141

1,150

$

0.87 $
0.21

0.71 $
0.11

0.49 $
0.07

2.37 $
0.46

5.51
0.84

$

1.08 $

0.82 $

0.56 $

2.83 $

6.35

Effects of the above adjustments
Non-GAAP diluted earnings per share

RECONCILIATION OF GAAP TO NON-GAAP MEASURES, Continued
4th Qtr.
September 3,
2020
GAAP net cash provided by operating activities
Investments in capital expenditures, net$

Expenditures for property, plant, and equipment, net(1)Payments on equipment purchase contracts
Amounts funded by partners
Adjusted free cash flow

(1)$

3rd Qtr.
May 28,2020

4th Qtr.
August 29,
2019Year Ended
September 3,
August 29,
2020
2019

2,271 $

2,023 $

2,233 $

8,306 $

13,189(2,268)(14)122(1,937)(20)
35(1,983)(21)
80(8,154)(63)
272(9,634)
(75)
754

111 $

101 $

309 $

361 $

4,234

Expenditures for property, plant, and equipment, net include proceeds from sales of property, plant, and equipment of $12 million for the fourth
quarter of 2020, $7 million for the third quarter of 2020, $45 million for the fourth quarter of 2019, $69 million for the full year of 2020, and $146
million for the full year of 2019.

September 3,
2020

As of
Cash and short-term investments
Current and noncurrent restricted cash
Long-term marketable investments

August 29,
2019$

8,142 $
66
1,048
(6,643)8,658 $
53
577
(6,686)

7,955
127
1,164
(5,851)$

2,613 $

2,602 $

3,395

Current and long-term debt
Net cash

May 28,2020

The tables above reconcile GAAP to non-GAAP measures of gross margin, operating expenses, operating income, net income attributable to Micron,diluted shares, diluted earnings per share, adjusted free cash flow, and net cash. The non-GAAP adjustments above may or may not be infrequent or
nonrecurring in nature, but are a result of periodic or non-core operating activities. We believe this non-GAAP information is helpful in understanding
trends and in analyzing our operating results and earnings. We are providing this information to investors to assist in performing analysis of ouroperating results. When evaluating performance and making decisions on how to allocate our resources, management uses this non-GAAP
information and believes investors should have access to similar data when making their investment decisions. We believe these non-GAAP financial
measures increase transparency by providing investors with useful supplemental information about the financial performance of our business,enabling enhanced comparison of our operating results between periods and with peer companies. The presentation of these adjusted amounts varies
from amounts presented in accordance with U.S. GAAP and therefore may not be comparable to amounts reported by other companies. Our
management excludes the following items in analyzing our operating results and understanding trends in our earnings:

Stock-based compensation;
Flow-through of business acquisition-related inventory adjustments;
Acquisition-related costs;
Start-up and preproduction costs;
Employee severance;
Restructure and asset impairments;
Amortization of debt discount and other costs, including the accretion of non-cash interest expense associated with ourconvertible debt and MMJ creditor debt;
Gains and losses from debt repurchases and conversions;
Gains and losses from business acquisition activities;
Impact of U.S. income tax reform for the one-time transition tax, release of U.S. valuation allowance, and remeasurementof net deferred taxes reflecting lower U.S. corporate tax rates; andThe estimated tax effects of above, non-cash changes in net deferred income taxes, and assessments of tax exposures.
Non-GAAP diluted shares are adjusted for the impact of additional shares resulting from the exclusion of stock-based compensation from non-GAAP
income. Non-GAAP diluted shares also include the impact of capped calls, which are anti-dilutive in GAAP earnings per share but are expected tomitigate the dilutive effect of convertible notes, based on the average share price for the period the capped calls were outstanding.

MICRON TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOKGAAP Outlook
Revenue
Gross margin
Operating expenses
Interest (income) expense, net
Diluted earnings per share(1)$5.2 billion ± $200 million
26.5% ± 1%$873 million ± $25 million$37 million

Adjustments—
1% A$48 million B$2 million C$0.39 ± $0.07

Non-GAAP Outlook$5.2 billion ± $200 million
27.5% ± 1%$825 million ± $25 million$35 million$0.08 A, B, C, D

$0.47 ± $0.07

Non-GAAP Adjustments(in millions)
A
A
B
B
C

Stock-based compensation – cost of goods sold
Other – cost of goods sold
Stock-based compensation – sales, general, and administrative
Stock-based compensation – research and development
Amortization of debt discount and other costsD

Tax effects of the above items and non-cash changes in net deferred income taxes

(1)

$

39
7
25
23
2
(1)

$

95

GAAP earnings per share based on approximately 1.13 billion diluted shares and non-GAAP earnings per share based on approximately 1.15
billion diluted shares.

The tables above reconcile our GAAP to non-GAAP guidance based on the current outlook. The guidance does not incorporate the impact of any
potential business combinations, divestitures, restructuring activities, balance sheet valuation adjustments, strategic investments, financing
transactions, and other significant transactions. The timing and impact of such items are dependent on future events that may be uncertain or outsideof our control.
Contacts: Farhan Ahmad Investor Relations farhanahmad@micron.com (408) 834-1927 Erica Rodriguez Pompen Media Relations
epompen@micron.com (408) 834-1873