Micron Technology, Inc. Reports Results for the Second Quarter of Fiscal 2021
March 31, 2021
Strong execution drives robust growth across multiple end markets
BOISE, Idaho, March 31, 2021 (GLOBE NEWSWIRE) -- Micron Technology, Inc. (Nasdaq: MU) today announced results for its second quarter of fiscal
2021, which ended March 4, 2021.
Fiscal Q2 2021 highlights

Revenue of $6.24 billion versus $5.77 billion for the prior quarter and $4.80 billion for the same period last year
GAAP net income of $603 million, or $0.53 per diluted share
Non-GAAP net income of $1.13 billion, or $0.98 per diluted share
Operating cash flow of $3.06 billion versus $1.97 billion for the prior quarter and $2.00 billion for the same period last year
“Micron’s strong fiscal second quarter performance reflects rapidly improving market conditions and continued solid execution,” said Micron
Technology President and CEO Sanjay Mehrotra. “Our technology leadership in both DRAM and NAND places Micron in an excellent position tocapitalize on the secular demand driven by AI and 5G, and to deliver new levels of user experience and innovation across the data center andintelligent edge.”
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

FQ2-21
$

6,236
$
1,649
26.4 %
986
663
10.6 %
603
0.53

Non-GAAP(2)FQ1-21

FQ2-20

5,773
$
1,736
30.1 %
870
866
15.0 %
803
0.71

4,797
1,355
28.2 %
915
440
9.2 %
405
0.36

FQ2-21
$

6,236
$
2,054
32.9 %
797
1,257
20.2 %
1,128
0.98

FQ1-21
5,773
$
1,784
30.9 %
811
973
16.9 %
897
0.78

FQ2-204,797
1,398
29.1 %
856
542
11.3 %
517
0.45

Investments in capital expenditures, net(2) were $2.88 billion for the second quarter of 2021, which resulted in adjusted free cash flows(2) of $174
million. Micron ended the quarter with cash, marketable investments, and restricted cash of $8.57 billion, for a net cash(2) position of $1.95 billion.
Business Outlook
The following table presents Micron’s guidance for the third quarter of 2021:
FQ3-21
Revenue
Gross margin
Operating expenses
Interest (income) expense, net
Diluted earnings per share

GAAP(1) Outlook

Non-GAAP(2) Outlook$7.1 billion ± $200 million
40.5% ± 1%$930 million ± $25 million$27 million$1.52 ± $0.07$7.1 billion ± $200 million
41.5% ± 1%$875 million ± $25 million$25 million$1.62 ± $0.07

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 Wednesday, March 31, 2021, at 2:30 p.m. MT to discuss its second quarter financial results and provide forwardlooking guidance for its third quarter. A live webcast of the call will be available online at investors.micron.com. A webcast replay will be available forone 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 transforming how the world uses information to enrich life for all. With arelentless focus on our customers, technology leadership, and manufacturing and operational excellence, Micron delivers a rich portfolio of
high-performance DRAM, NAND, and NOR memory and storage products through our Micron® and Crucial® brands. Every day, the innovations thatour people create fuel the data economy, enabling advances in artificial intelligence and 5G applications that unleash opportunities — from the datacenter to the intelligent edge and across the client and mobile user experience. To learn more about Micron Technology, Inc. (Nasdaq: MU), visit
micron.com.
© 2021 Micron Technology, Inc. All rights reserved. Micron, the Micron logo, and all other Micron trademarks are the property 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 our 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)
2nd Qtr.
March 4,
2021
Revenue$

Cost of goods sold
Gross margin
Research and development
Selling, general, and administrative
Other operating (income) expense, net
Operating income
Interest income
Interest expense
Other non-operating income (expense), net

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

6,236
4,587

$

5,773
4,037

2nd Qtr.
February 27,
2020
$

4,797
3,442

Six Months Ended
March 4,
February 27,
2021
2020
$

12,009
8,624

$

9,941
7,220

1,649

1,736

1,355

3,385

2,721

641
214
131

647
214
9

681
223
11

1,288
428
140

1,321
434
8

663

866

440

1,529

958

10
(42)
4

10
(48)
13

34
(46)
(1)

20
(90)
17

78
(93)
45

635

841

427

1,476

988

(48)
16

(51)
13

(21)
1

(99)
29

(76)
3

603

803

407

1,406

915

—

Net income attributable to noncontrolling interests
Net income attributable to Micron

1st Qtr.
December 3,
2020

—

(2)

—

(19)

$

603

$

803

$

405

$

1,406

$

896

$

0.54
0.53

$

0.72
0.71

$

0.37
0.36

$

1.26
1.23

$

0.81
0.79

1,120
1,144

1,115
1,135

1,111
1,133

1,118
1,139

1,109
1,131

MICRON TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS(In millions)(Unaudited)
As ofMarch 4,

December 3,

September 3,

2021
AssetsCash and equivalents
Short-term investments
Receivables
Inventories
Assets held for sale$

Other current assets
Total current assets
Long-term marketable investments
Property, plant, and equipment
Operating lease right-of-use assets
Intangible assets
Deferred tax assets
Goodwill

6,507
677
3,353
4,743
1,461
538

2020

$

17,2791,316
31,848
575
342
726
1,228
821

Other noncurrent assets
Total assets
Liabilities and equity
Accounts payable and accrued expenses
Current debt

5,985
1,047
3,691
5,242
—
564

2020

$

16,5291,264
32,229
577
336
726
1,228
802

7,624
518
3,912
5,373
—
538
17,965
1,048
31,031
584
334
707
1,228
781

$

54,135$53,691$53,678

$

4,550
323
560

$

4,856
273
559

$

5,817
270
548

Other current liabilities
Total current liabilities
Long-term debt
Noncurrent operating lease liabilities
Noncurrent unearned government incentives

5,433
6,298
528
661
552

5,688
6,356
529
656
555

6,635
6,373
533
643
498

13,472

13,784

14,682

120
9,234
34,723(3,495)
81

120
9,034
34,138(3,495)
110

119
8,917
33,384(3,495)
71

Other noncurrent liabilities
Total liabilities
Commitments and contingencies
Shareholders’ equity
Common stock
Additional capital
Retained earnings
Treasury stock
Accumulated other comprehensive income (loss)

40,663

Total equity$

Total liabilities and equity

54,13539,907$53,691

38,996$53,678

MICRON TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions)(Unaudited)
March 4,2021

Six months 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

$

1,406

February 27,
2020

$

915

3,036
15
189
—

2,661
16
157
(42)

533
629
(777)
(11)

104
(69)
257
38

4

(25)

5,024

4,012

(5,756)(1,349)
746
178
176
31

(3,999)
(566)
523
1,059
105
(21)

(5,974)(2,899)

(123)
(103)
—
—
17

(29)
(1,676)
(744)
1,250
(8)

(209)

(1,207)43(14)(1,116)
7,690

(108)
7,279

Other
Net cash provided by operating activities
Cash flows from investing activities
Expenditures for property, plant, and equipment
Purchases of available-for-sale securities
Proceeds from maturities of available-for-sale securities
Proceeds from sales of available-for-sale securities
Proceeds from government incentives
Other
Net cash provided by (used for) investing activities
Cash flows from financing activities
Payments on equipment purchase contracts
Repayments of debt
Acquisition of noncontrolling interest in IMFT
Proceeds from issuance of debt
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

6,574

$

7,171

MICRON TECHNOLOGY, INC.
NOTES
(Unaudited)
Inventory
Effective as of the beginning of the second quarter of 2021, we changed our method of inventory costing from average cost to FIFO. This change inaccounting principle is preferable because in an environment with continuously changing production costs FIFO more closely matches the actual costof goods sold with the revenues from sales of those specific units, better represents the actual cost of inventories remaining on hand at any
period-end, and improves comparability with our semiconductor industry peers. The change to FIFO was not material to any prior periods, nor is the
cumulative effect of $133 million material to the second quarter of 2021. As such, prior periods were not retrospectively adjusted, and the cumulative
effect was reported as an increase to cost of goods sold for the second quarter of 2021 of $133 million, with an offsetting reduction to beginninginventories. This charge resulted in a corresponding reduction to operating income, a $128 million reduction to net income, and an $0.11 reduction to
diluted earnings per share for the second quarter of 2021.
Beginning in the second quarter of 2021, we changed the classification of spare parts for equipment to better align with the manner in which they areused in operations. As a result, we now present spare parts as other current assets and no longer as a component of raw materials inventories. This
reclassification was applied on a retrospective basis. As a result, $270 million of spare parts were presented in other current assets as of March 4,2021, and we reclassified spare parts from inventories to other current assets of $279 million and $234 million in the accompanying balance sheets asof December 3, 2020 and September 3, 2020, respectively.
Assets Held for Sale
In the second quarter of 2021, we updated our portfolio strategy to further strengthen our focus on memory and storage innovations for the data center
market. In connection therewith, we determined that there was insufficient market validation to justify the ongoing investments required tocommercialize 3D XPointTM at scale. Effective as of the end of the second quarter of 2021, we ceased development of 3D XPoint technology andengaged in discussions with potential buyers for the sale of our facility located in Lehi, Utah, that was dedicated to 3D XPoint production. As a result,
we classified the property, plant, and equipment as held-for-sale and ceased depreciating the assets. As of March 4, 2021, the significant balances ofassets and liabilities classified as held-for-sale in connection with our Lehi facility included $1.44 billion of property, plant, and equipment included in
assets held for sale and $51 million of a finance lease obligation included in current portion of long-term debt. We also recognized a charge of$49 million to cost of goods sold in the second quarter of 2021 to write down 3D XPoint inventory due to our decision to cease further development of
this technology. We expect to reach an agreement for the sale of our Lehi facility within calendar year 2021.

MICRON TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES(In millions, except per share amounts)
2nd Qtr.

1st Qtr.

2nd Qtr.

March 4,2021
GAAP gross margin
Inventory accounting policy change to FIFO
Change in inventory cost absorption
3D XPoint inventory write-down
Stock-based compensation

December 3,
2020

February 27,
2020

$

1,649
133
160
49
57
6

$

1,736
—
—
—
41
7

$

1,355
—
—
—
37
6

Non-GAAP gross margin

$

2,054

$

1,784

$

1,398

GAAP operating expenses
Stock-based compensation
Patent license charges
Restructure and asset impairments

$

986
(55)
(128)
(5)
(1)

$

870
(51)
—
(8)
—

$

915
(48)
—
(10)
(1)

Non-GAAP operating expenses

$

797

$

811

$

856

GAAP operating income
Inventory accounting policy change to FIFO
Change in inventory cost absorption
3D XPoint inventory write-down
Stock-based compensation
Patent license charges
Restructure and asset impairments

$

663
133
160
49
112
128
5
7

$

866
—
—
—
92
—
8
7

$

440
—
—
—
85
—
10
7

Non-GAAP operating income

$

1,257

$

973

$

542

GAAP net income attributable to Micron
Inventory accounting policy change to FIFO
Change in inventory cost absorption
3D XPoint inventory write-down
Stock-based compensation
Patent license charges
Restructure and asset impairments
Amortization of debt discount and other costs
Other

$

603
133
160
49
112
128
5
8
7
(77)

$

803
—
—
—
92
—
8
7
7
(20)

$

405
—
—
—
85
—
10
6
7
4

$

1,128

$

897

$

517

Other

Other

Other

Estimated tax effects of above and non-cash changes in net deferred income taxes
Non-GAAP net income attributable to Micron
GAAP weighted-average common shares outstanding - Diluted
Adjustment for stock-based compensation and capped calls
Non-GAAP weighted-average common shares outstanding - Diluted
GAAP diluted earnings per share

1,135
11

1,133
11

1,154

1,146

1,144

$

0.53
0.45

$

0.71
0.07

$

0.36
0.09

$

0.98

$

0.78

$

0.45

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

1,144
10

RECONCILIATION OF GAAP TO NON-GAAP MEASURES, Continued
2nd Qtr.
March 4,2021
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$(3,000)(26)
143

Amounts funded by partners
Adjusted free cash flow

3,057

1st Qtr.
December 3,
2020

$

174

1,967

2nd Qtr.
February 27,
2020$(2,726)
(97)
40
$

(816)

2,001
(2,013)
(18)
93

$

63

(1) Expenditures for property, plant, and equipment, net include proceeds from sales of property, plant, and equipment of $18 million for the second
quarter of 2021, $12 million for the first quarter of 2021, and $43 million for the second quarter of 2020.

March 4,
2021

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

September 3,
2020

$

7,184
67
1,316
(6,621)

$

7,032
67
1,264
(6,629)

$

8,142
66
1,048
(6,643)

$

1,946

$

1,734

$

2,613

Current and long-term debt
Net cashDecember 3,
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;
Patent license charges;
Restructure and asset impairments;
Amortization of debt discount and other costs, including the accretion of non-cash interest expense associated with ourconvertible notes and other debt;
Gains and losses from debt repurchases and conversions;
Gains and losses from business acquisition activities;
Initial impact of inventory accounting policy change to FIFO and change in inventory cost absorption in the second quarterof 2021; andThe estimated tax effects of above, non-cash changes in net deferred income taxes, assessments of tax exposures, andsignificant changes in tax law.
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 tomitigate 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 OUTLOOK
FQ3-21GAAP Outlook

Revenue
Gross margin
Operating expenses
Interest (income) expense, net$7.1 billion ± $200 million
40.5% ± 1%$930 million ± $25 million$27 million

Diluted earnings per share(1)$1.52 ± $0.07

Adjustments—
1% A$55 million B$2 million C

Non-GAAP Outlook$7.1 billion ± $200 million
41.5% ± 1%$875 million ± $25 million$25 million$0.10 A, B, C, D

$1.62 ± $0.07

Non-GAAP Adjustments(in millions)
A Stock-based compensation – cost of goods sold$46

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

7
29
26
2
2

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

112(1) GAAP earnings per share based on approximately 1.15 billion diluted shares and non-GAAP earnings per share based on approximately 1.16
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