The text set forth below is an excerpt from the Quarterly Report on Form 10-Q (the "Form 10-Q"), filed by Micron Technology, Inc., on June 27, 2024, for its third
quarter ended May 30, 2024, and has not been updated for any events subsequent to the date of the report. Any cross references or defined terms used in the text
below are to the corresponding sections or definitions, as applicable, in the Form 10-Q.

ITEM 1A. RISK FACTORSIn addition to the factors discussed elsewhere in this Form 10-Q, this section discusses important factors which
could cause actual results or events to differ materially from those contained in any forward-looking statements
made by us. The order of presentation is not necessarily indicative of the level of risk that each factor poses to us.
Any of these factors could have a material adverse effect on our business, results of operations, financial condition,or stock price. Our operations could also be affected by other factors that are presently unknown to us or notconsidered significant.

Risk Factor Summary
Risks Related to Our Business, Operations, and Industry
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volatility in average selling prices of our products;
a range of factors that may adversely affect our gross margins;
our international operations, including geopolitical risks;
the highly competitive nature of our industry;
our ability to develop and produce new and competitive memory and storage technologies and products;
realizing expected returns from capacity expansions;achieving or maintaining certain outcomes or compliance with other obligations associated with incentives
from various governments;
availability and quality of materials, supplies, and capital equipment and dependency on third-party service
providers;a downturn in regional or worldwide economies;
disruptions to our manufacturing process from operational issues, natural disasters, or other events;
dependency on a select number of key customers, including international customers;
products that fail to meet specifications, are defective, or are incompatible with end uses;
breaches of our security systems or products, or those of our customers, suppliers, or business partners;
attracting, retaining, and motivating highly skilled employees;
responsible sourcing requirements and related regulations;environmental, social, and governance considerations;acquisitions and/or alliances; andrestructure plans may not realize expected savings or other benefits.

Risks Related to Intellectual Property and Litigation•••

protecting our intellectual property and retaining key employees who are knowledgeable of and develop our
intellectual property;
legal proceedings and claims; andclaims that our products or manufacturing processes infringe or otherwise violate the intellectual property
rights of others or failure to obtain or renew license agreements covering such intellectual property.

Risks Related to Laws and Regulations•••

impacts of government actions and compliance with tariffs, trade restrictions, and/or trade regulations;tax expense and tax laws in key jurisdictions; andcompliance with laws, regulations, or industry standards, including environmental considerations.

Risks Related to Capitalization and Financial Markets
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our ability to generate sufficient cash flows or obtain access to external financing;
our debt obligations;changes in foreign currency exchange rates;
counterparty default risk;
volatility in the trading price of our common stock; andfluctuations in the amount and frequency of our common stock repurchases and payment of cash dividends
and resulting impacts.

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Risks Related to Our Business, Operations, and Industry
Volatility in average selling prices for our semiconductor memory and storage products may adversely
affect our business.
We have experienced significant volatility in our average selling prices and may continue to experience suchvolatility in the future. For example, average selling prices for DRAM declined in the high-40s percent range and
NAND declined in the low-50s percent range for 2023 as compared to 2022. Since 2017, annual percentagechanges in DRAM average selling prices have ranged from plus mid-30s percent range to a minus high-40s percent
range. Since 2017, annual percentage changes in NAND average selling prices have ranged from nearly flat to aminus low-50s percent range. In recent periods, average selling prices for our products have been below our
manufacturing costs and we may experience such circumstances in the future. Average selling prices for our
products that decline faster than our costs have recently had an adverse effect on our business and results ofoperations, and in future periods could have a material adverse effect on our business, results of operations, or
financial condition.
Our gross margins may be adversely affected by a range of factors.
Our gross margins are dependent, in part, upon continuing decreases in per gigabit manufacturing costs achieved
through improvements in our manufacturing processes and product designs. Factors that may limit our ability to
reduce our per gigabit manufacturing costs at sufficient levels to prevent deterioration of or improve gross margins
include, but are not limited to:
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strategic product diversification decisions affecting product mix;
increasing complexity of manufacturing processes;
difficulties in transitioning to smaller line-width process technologies or additional 3D memory layers or
NAND cell levels;
process complexity including number of mask layers and fabrication steps;
manufacturing yield;
technological barriers;changes in process technologies;
new products that may require relatively larger die sizes;
start-up or other costs associated with capacity expansions;higher costs of goods and services due to inflationary pressures or market conditions; andhigher manufacturing costs per gigabit due to fabrication facility underutilization, lower wafer output, andinsufficient volume to run new technology nodes to achieve cost optimization.

Many factors may result in a reduction of our output or a delay in ramping production, which could lead tounderutilization of our production assets. These factors may include, among others, a weak demand environment,
industry oversupply, inventory surpluses, difficulties in ramping emerging technologies, supply chain disruptions,and delays from equipment suppliers. See “Part I. Financial Information – Item 2. Management’s Discussion andAnalysis of Financial Condition and Results of Operations – Overview – Industry Conditions” for information
regarding our recent underutilization charges. A significant portion of our manufacturing costs are fixed and do notvary proportionally with changes in production output. As a result, lower utilization, lower wafer output, andcorresponding increases in our per gigabit manufacturing costs have resulted in higher inventory carrying costs, andhave had, and may continue to have, an adverse effect on our gross margins, business, results of operations, or
financial condition.

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We have a broad portfolio of products to address our customers’ needs, which span multiple market segments andare subject to rapid technological changes. Our manufacturing costs on a per gigabit basis vary across our portfolio
as they are largely influenced by the technology node in which the solution was developed. We strive to balance ourdemand and supply for each technology node, but the dynamics of our markets and our customers can create
periods of imbalance, which can lead us to carry elevated inventory levels. Consequently, we may incur charges inconnection with obsolete or excess inventories, or we may not fully recover our costs, which would reduce our grossmargins. For example, in 2023, we recorded aggregate charges of $1.83 billion to write down the carrying value of
our inventories to their estimated net realizable value. In addition, due to the customized nature of certain products
we manufacture, we may be unable to sell certain finished goods inventories to alternative customers or
manufacture in-process inventory to different specifications, which may result in excess and obsolescence charges
in future periods.
In addition, if we are unable to supply products that meet customer design and performance specifications, we may
be required to sell such products at lower average selling prices, which may reduce our gross margins. Our grossmargins may also be impacted by shifts in product mix, driven by our strategy to optimize our portfolio to best
respond to changing market dynamics.
Our inability to prevent deterioration of or improve gross margins could have a material adverse effect on ourbusiness, results of operations, or financial condition.
We face geopolitical and other risks associated with our international operations that could materiallyadversely affect our business, results of operations, or financial condition.
In addition to our U.S. operations, a substantial portion of our operations are conducted in Taiwan, Singapore,
Japan, Malaysia, China, and India, and many of our customers, suppliers, and vendors also operate internationally.
In 2023, nearly half of our revenue was from sales to customers who have headquarters located outside the UnitedStates, while over 80% of our revenue in 2023 was from products shipped to customer locations outside the UnitedStates.
Our international operations are subject to a number of risks, including:
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restrictions on sales of goods or services to one or more of our significant foreign customers;
export and import duties, changes to import and export regulations, customs regulations and processes,
and restrictions on the transfer of funds, including currency controls in China, which could negatively affectthe amount and timing of payments from certain of our customers and, as a result, our cash flows;compliance with U.S. and international laws involving international operations, including the Foreign Corrupt
Practices Act of 1977, as amended, sanctions and anti-corruption laws, export and import laws, and similar
rules and regulations;
theft of intellectual property;
political and economic instability, including instability resulting from domestic and international conflicts;
government actions or civil unrest preventing the flow of products and materials, including delays inshipping and obtaining products and materials, cancellation of orders, or loss or damage of products;
problems with the transportation or delivery of products and materials;
issues arising from cultural or language differences and labor unrest;
longer payment cycles and greater difficulty in collecting accounts receivable;
compliance with trade, technical standards, and other laws in a variety of jurisdictions;contractual and regulatory limitations on the ability to maintain flexibility with staffing levels;
disruptions to manufacturing or R&D activities as a result of actions imposed by foreign governments;changes in economic policies of foreign governments;
difficulties in staffing and managing international operations; andpublic health issues.

If we or our customers, suppliers, or vendors are impacted by any of these risks, it could have a material adverse
effect on our business, results of operations, or financial condition.

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Following the May 21, 2023 decision of its cybersecurity review of our products sold in China, the CAC determinedthat critical information infrastructure operators in China may not purchase Micron products, impacting our revenue
with companies headquartered in mainland China and Hong Kong, including direct sales as well as indirect sales
through distributors. Some revenue with customers headquartered outside of China has also been impacted.
Further actions by the Chinese government could impact additional revenue inside or outside China, or ouroperations in China, or our ability to ship products to our customers, any of which could have a material adverse
effect on our business, results of operations, or financial condition.
Political, economic, or other actions may adversely affect our operations in Taiwan. A majority of our DRAM
production output in 2023 was from our fabrication facilities in Taiwan and any loss of output could have a material
adverse effect on us. Any political, economic, or other actions may also adversely affect our customers and thetechnology industry supply chain, for which Taiwan is a central hub, and as a result, could have a material adverse
impact on us.
In addition, the U.S. government has in the past restricted American firms from selling products and software tocertain of our customers and may in the future impose similar restrictions on one or more of our significant
customers. These restrictions may not prohibit our competitors from selling similar products to our customers, which
may result in our loss of sales and market share. Even as such restrictions are lifted, financial or other penalties orcontinuing export restrictions imposed with respect to our customers could have a continuing negative impact on our
future revenue and results of operations, and we may not be able to recover any customers or market share welose, or make such recoveries at acceptable average selling prices, while complying with such restrictions.
The semiconductor memory and storage markets are highly competitive.
We face intense competition in the semiconductor memory and storage markets from a number of companies,
including Kioxia Holdings Corporation; Samsung Electronics Co., Ltd.; SK hynix Inc.; and Western Digital
Corporation. Our competitors may use aggressive pricing to obtain market share. Some of our competitors are large
corporations or conglomerates that may have a larger market share and greater resources to invest in technology,
capitalize on growth opportunities, and withstand downturns in the semiconductor markets in which we compete.
Consolidation of industry competitors could put us at a competitive disadvantage as our competitors may benefit
from increased manufacturing scale and a stronger product portfolio. We operate in different jurisdictions than ourcompetitors and may be impacted by unfavorable changes in currency exchange rates.
In addition, some governments may provide, or have provided and may continue to provide, significant assistance,
financial or otherwise, to some of our competitors or to new entrants and may intervene in support of national
industries and/or competitors. In particular, we face the threat of increasing competition as a result of significant
investment in the semiconductor industry by the Chinese government and various state-owned or affiliated entities,
in companies such as Yangtze Memory Technologies Co., Ltd. (“YMTC”) and ChangXin Memory Technologies, Inc.
(“CXMT”). In addition, the CAC’s decision that critical information infrastructure operators in China may notpurchase Micron products had an impact on our ability to compete effectively in China and elsewhere.
We and our competitors generally seek to increase supply to address growing market demands, improve yields, andreduce die size, which could result in significant increases in worldwide supply and downward pressure on prices.
Increases in worldwide supply of semiconductor memory and storage also result from fabrication capacity
expansions, either by way of new facilities, increased capacity utilization, or reallocation of other semiconductor
production to semiconductor memory and storage production. Our competitors may increase capital expenditures
resulting in future increases in worldwide supply. We, and some of our competitors, have plans to ramp, or are
constructing or ramping, production at new fabrication facilities. Increases in worldwide supply of semiconductor
memory and storage, if not accompanied by commensurate increases in demand, could lead to declines in average
selling prices for our products and could materially adversely affect our business, results of operations, or financial
condition. If competitors are more successful at developing or implementing new product or process technology,
their products could have cost or performance advantages.
The competitive nature of our industry could have a material adverse effect on our business, results of operations,or financial condition.

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Our future success depends on our ability to develop and produce new and competitive memory andstorage technologies and products.
Our key semiconductor memory and storage technologies face technological barriers to continue to meet long-term
customer needs. These barriers include potential limitations on stacking additional 3D memory layers, increasing
bits per cell (i.e., cell levels), meeting higher density requirements, developing advanced packaging solutions,improving power consumption and reliability, and delivering advanced features and higher performance. We may
face technological barriers to continue to shrink our products at our current or historical rate, which has generally
reduced per gigabit cost. We have invested and expect to continue to invest in R&D for new and existing products
and process technologies, such as EUV lithography, to continue to deliver advanced product requirements. Such
new technologies can add complexity and risk to our schedule and may affect our costs and production output. We
may be unable to recover our investment in R&D or otherwise realize the economic benefits of reducing die size or
increasing memory and storage densities. Our competitors are working to develop new memory and storage
technologies that may offer performance and/or cost advantages to existing technologies and render existing
technologies obsolete. Accordingly, our future success may depend on our ability to develop and produce viable andcompetitive new memory and storage technologies.
We are developing new products, including system-level memory and storage products and solutions, which
complement our traditional products or leverage their underlying design or process technology. We have invested
and expect to continue to invest in new semiconductor product and system-level solution development. We are
increasingly differentiating our products and solutions to meet the specific demands of our customers, which
increases our reliance on our customers’ ability to accurately forecast the needs and preferences of their customers.
As a result, our product demand forecasts may be impacted significantly by the strategic actions of our customers.
In addition, our ability to successfully introduce new products often requires us to make product specification
decisions multiple years in advance of when new products enter the market.
It is important that we deliver products in a timely manner with increasingly advanced performance characteristics at
the time our customers are designing and evaluating samples for their products. If we do not meet their productdesign schedules, our customers may exclude us from further consideration as a supplier for those products. The
process to develop new products requires us to demonstrate advanced functionality, performance, and reliability,
often well in advance of a planned ramp of production, in order to secure design wins with our customers. Many
factors may negatively impact our ability to meet anticipated timelines and/or expected or required quality standards
with respect to the development of certain of our products. In addition, some of our components have long leadtimes, requiring us to place orders up to a year in advance of anticipated demand. Such long lead-times increase
the risk of excess inventory or loss of sales in the event our forecasts vary substantially from actual demand.
There can be no assurance of the following:
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we will be successful in developing competitive new semiconductor memory and storage technologies andproducts;
we will be able to cost-effectively manufacture new products;
we will be able to successfully market these technologies;
margins generated from sales of these products will allow us to recover costs of development efforts;
we will be able to establish or maintain key relationships with customers, or that we will not be prohibitedfrom working with certain customers, for specific chip set or design requirements;
we will accurately predict and design products that meet our customers' specifications; or
we will be able to introduce new products into the market and qualify them with our customers on a timely
basis.

Unsuccessful efforts to develop new memory and storage technologies and products could have a material adverse
effect on our business, results of operations, or financial condition.

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We may not be able to achieve expected returns from capacity expansions.
We have announced our intent to expand our production capacity and/or make capital investments in the UnitedStates and in other regions where we operate.
These expansions involve several risks including the following:
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capital expenditure requirements for capacity expansions during periods of relatively low free cash flow
generation, resulting from challenging memory and storage industry conditions;availability of necessary funding, which may include external sources;ability to realize expected grants, investment tax credits, and other government incentives, including
through the CHIPS Act and other national, international, state, and local grants;
potential changes in laws or provisions of grants, investment tax credits, and other government incentives;potential restrictions or delays related to environmental regulations or permits;
potential restrictions on expanding in certain geographies;
availability of equipment and construction materials;
ability to complete construction as scheduled and within budget;
availability of the necessary workforce;
ability to timely ramp production in a cost-effective manner;increases to our cost structure until new production is ramped to adequate scale; andsufficient customer demand to utilize our increased capacity.

We invest our capital in areas that we believe best align with our business strategy and optimize future returns.
Investments in capital expenditures may not generate expected returns or cash flows. Significant judgment isrequired to determine which capital investments will result in optimal returns, and we could invest in projects that are
ultimately less profitable than those projects we do not select. Delays in completion and ramping of new production
facilities, or failure to optimize our investment choices, could significantly impact our ability to realize expected
returns on our capital expenditures.
Any of the above factors could have a material adverse effect on our business, results of operations, or financial
condition.
Our incentives from various governments are conditional upon achieving or maintaining certain outcomesor compliance with other obligations and are subject to reduction, termination, clawback, or could impose
certain limitations on our business.
We have received, and may in the future continue to receive, benefits and incentives from national, state, and local
governments in various regions of the world designed to encourage us to establish, maintain, or increase
investment, workforce, research and development, or production in those regions. These incentives may takevarious forms, including grants, subsidies, loans, and tax arrangements, and typically require us to achieve or
maintain certain levels of investment, capital spending, employment, technology deployment or development
milestones, construction or production milestones, or research and development activities to qualify for suchincentives or could restrict us from undertaking certain activities. We may be unable to obtain sufficient future
incentives to continue to fund a portion of our capital expenditures and operating costs, without which our cost
structure may be adversely impacted and planned capital expenditures and research and development
expenditures may be affected. We also cannot guarantee that we will successfully achieve and maintain outcomesor be able to comply with other obligations required to qualify for these incentives or that the granting agencies will
provide or continue to provide such funding. These incentive arrangements typically provide the granting agencies
with rights to audit our compliance with their terms and obligations. Such audits could result in modifications to, or
termination of, the applicable incentive program. The incentives we receive could be subject to reduction,
termination, or clawback, and any decrease or clawback of government incentives could have a material adverse
effect on our business, results of operations, or financial condition.

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Our business, results of operations, or financial condition could be adversely affected by the availability
and quality of materials, supplies, and capital equipment, or dependency on third-party service providers.
Our supply chain and operations are dependent on the availability of materials that meet exacting standards and theuse of third parties to provide us with components and services. We generally have multiple sources of supply forour materials and services. However, only a limited number of suppliers are capable of delivering certain materials,
components, and services that meet our standards and, in some cases, materials, components, or services areprovided by a single or sole source, and we may be unable to qualify new suppliers on a timely basis. The
availability of materials or components such as chemicals, silicon wafers, gases, photoresist, controllers, substrates,
lead frames, printed circuit boards, targets, and reticle glass blanks is impacted by various factors. These factors
could include a shortage of raw materials or a disruption in the processing or purification of those raw materials into
finished goods. Shortages or increases in lead times have occurred in the past, are currently occurring with respect
to some materials and components, and may occur from time to time in the future. Constraints within our supply
chain for certain materials and integrated circuit components could limit our bit shipments, which could have amaterial adverse effect on our business, results of operations, or financial condition.
Our manufacturing processes are also dependent on our relationships with third-party manufacturers of controllers,
analog integrated circuits, and other components used in some of our products and with outsourced semiconductor
foundries, assembly and test providers, contract manufacturers, logistics carriers, and other service providers,
including providers of maintenance for our advanced semiconductor manufacturing equipment and providers ofelectricity and other utilities. Although we have certain long-term contracts with some of our suppliers, many of thesecontracts do not provide for long-term capacity or pricing commitments. To the extent we do not have firm
commitments from our third-party suppliers over a specific time period or for any specific capacity, quantity, and/or
pricing, our suppliers may allocate capacity to their other customers and capacity and/or materials may not be
available when needed or at reasonable prices. Inflationary pressures have increased, and may continue toincrease costs for materials, supplies, and services. Regardless of contract structure, large swings in demand may
exceed our contracted supply and/or our suppliers’ capacity to meet those demand changes resulting in a shortageof parts, materials, or capacity needed to manufacture our products. In addition, if any of our suppliers were tocease operations or become insolvent, this could impact their ability to provide us with necessary supplies, and we
may not be able to obtain the needed supply in a timely way or at all from other providers.
Certain materials are primarily available in a limited number of countries, including rare earth elements, minerals,
and metals. Trade disputes, geopolitical tensions, economic circumstances, political conditions, or public healthissues may limit our ability to obtain such materials. Although these rare earth and other materials are generally
available from multiple suppliers, China is the predominant producer of certain of these materials. If China were to
restrict or stop exporting these materials, our suppliers’ ability to obtain such supply may be constrained and we
may be unable to obtain sufficient quantities, or obtain supply in a timely manner, or at a commercially reasonable
cost. Constrained supply of rare earth elements, minerals, and metals may restrict our ability to manufacture certainof our products and make it difficult or impossible to compete with other semiconductor memory and storage
manufacturers who are able to obtain sufficient quantities of these materials from China.
We and/or our suppliers and service providers could be affected by regional conflicts, civil unrest, labor disruptions,sanctions, tariffs, embargoes, or other trade restrictions, as well as laws and regulations enacted in response toconcerns regarding climate change, conflict minerals, responsible sourcing practices, public health crises, or othermatters, which could limit the supply of our materials and/or increase the cost. Environmental regulations could limit
our ability to procure or use certain chemicals or materials in our operations or products. In addition, disruptions intransportation lines could delay our receipt of materials. Our ability to procure components to repair equipment
essential for our manufacturing processes could also be negatively impacted by various restrictions or disruptions in
supply chains, among other items. The disruption of our supply of materials, components, or services, or theextension of our lead times could have a material adverse effect on our business, results of operations, or financial
condition.

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Our operations are dependent on our ability to procure advanced semiconductor manufacturing equipment thatenables the transition to lower cost manufacturing processes. For certain key types of equipment, including
photolithography tools, we are sometimes dependent on a single supplier. From time to time, we have experienced
difficulties in obtaining some equipment on a timely basis due to suppliers’ limited capacity. Our inability to obtainequipment on a timely basis could adversely affect our ability to transition to next generation manufacturing
processes and reduce our costs. Delays in obtaining equipment could also impede our ability to ramp production
and could increase our overall costs of a ramp. Our inability to obtain advanced semiconductor manufacturing
equipment in a timely manner could have a material adverse effect on our business, results of operations, or
financial condition.
Our construction projects to expand production and R&D capacity are highly dependent on available sources oflabor, materials, equipment, and services. Increasing demand, supply constraints, inflation, and other market
conditions could result in increasing shortages and higher costs for these items. Difficulties in obtaining theseresources could result in significant delays in completion of our construction projects and cost increases, which
could have a material adverse effect on our business, results of operations, or financial condition.
Our inability to source materials, supplies, capital equipment, or third-party services could affect our overall
production output and our ability to fulfill customer demand. Significant or prolonged shortages of our products could
halt customer manufacturing and damage our relationships with these customers. Any damage to our customer
relationships as a result of a shortage of our products could have a material adverse effect on our business, resultsof operations, or financial condition.
Similarly, if our customers experience disruptions to their supplies, materials, components, or services, or theextension of their lead times, they may reduce, cancel, or alter the timing of their purchases with us, which could
have a material adverse effect on our business, results of operations, or financial condition.
Downturns in regional or worldwide economies may harm our business.
Downturns in regional or worldwide economies, due to inflation, geopolitics, major central bank policy actions
including interest rate increases, public health crises, or other factors, have harmed our business in the past andcurrent and future downturns could also adversely affect our business. Adverse economic conditions affect demandfor devices that incorporate our products, such as personal computers, smartphones, automobiles, and servers.
Reduced demand for these or other products could result in significant decreases in our average selling prices andproduct sales. In addition, to the extent our customers or distributors have elevated inventory levels or are impacted
by a deterioration in credit markets, we may experience a decrease in short-term and/or long-term demand resulting
in industry oversupply and declines in pricing for our products.
A deterioration of conditions in regional or worldwide credit markets could limit our ability to obtain external financing
to fund our operations and capital expenditures. In addition, we may experience losses on our holdings of cash andinvestments due to failures of financial institutions and other parties. Difficult economic conditions may also result ina higher rate of losses on our accounts receivable due to credit defaults. As a result, downturns in regional orworldwide economies could have a material adverse effect on our business, results of operations, or financial
condition.
If our manufacturing process is disrupted by operational issues, natural disasters, or other events, ourbusiness, results of operations, or financial condition could be materially adversely affected.
We and our subcontractors manufacture products using highly complex processes that require technologicallyadvanced equipment and continuous modification to improve yields and performance. Difficulties in the
manufacturing process or the effects from a shift in product mix can reduce yields or disrupt production and may
increase our per gigabit manufacturing costs. We and our subcontractors maintain operations and continuously
implement new product and process technology at manufacturing facilities, which are widely dispersed in multiple
locations in several countries including the United States, Singapore, Taiwan, Japan, Malaysia, and China. As aresult of the necessary interdependence within our network of manufacturing facilities, an operational disruption at
one of our or a subcontractor’s facilities may have a disproportionate impact on our ability to produce many of our
products.

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From time to time, there have been disruptions in our manufacturing operations as a result of power outages,
improperly functioning equipment, disruptions in supply of raw materials or components, or equipment failures. We
have manufacturing and other operations in locations subject to natural occurrences and possible climate changes,
such as severe and variable weather and geological events resulting in increased costs, or disruptions to ourmanufacturing operations or those of our suppliers or customers. In addition, climate change may pose physicalrisks to our manufacturing facilities or our suppliers’ facilities, including increased extreme weather events that could
result in supply delays or disruptions. Other events, including political or public health crises, such as an outbreak ofcontagious diseases, may also affect our production capabilities or that of our suppliers, including as a result of
quarantines, closures of production facilities, lack of supplies, or delays caused by restrictions on travel or shipping.
Events of the types noted above have occurred from time to time and may occur in the future. As a result, in
addition to disruptions to operations, our insurance premiums may increase or we may not be able to fully recover
any sustained losses through insurance.
If production is disrupted for any reason, manufacturing yields may be adversely affected, or we may be unable tomeet our customers’ requirements and they may purchase products from other suppliers. This could result in asignificant increase in manufacturing costs, loss of revenue, or damage to customer relationships, any of which
could have a material adverse effect on our business, results of operations, or financial condition.
A significant portion of our revenue is concentrated with a select number of customers.
Approximately one-half of our total revenue comes from our top ten customers. A disruption in our relationship withany of these customers could adversely affect our business. We could experience fluctuations in our customer baseor the mix of revenue by customer as markets and strategies evolve. Our customers’ demand for our products may
fluctuate due to factors beyond our control. In addition, any consolidation of our customers could reduce the numberof customers to whom our products may be sold. Our inability to meet our customers’ requirements or to qualify our
products with them could adversely impact our revenue. A meaningful change in the inventory strategy of ourcustomers could impact our industry bit demand growth outlook. The loss of, or restrictions on our ability to sell to,one or more of our major customers, or any significant reduction in orders from, or a shift in product mix by,customers could have a material adverse effect on our business, results of operations, or financial condition.
Increases in sales of system solutions may increase our dependency upon specific customers and ourcosts to develop, qualify, and manufacture our system solutions.
Our development of system-level memory and storage products is dependent, in part, upon successfully identifying
and meeting our customers’ specifications for those products. Developing and manufacturing system-level productswith specifications unique to a customer increases our reliance upon that customer for purchasing our products at
sufficient volumes and prices in a timely manner. Even if our products meet customer specifications, our sales ofsystem-level solutions are dependent upon our customers choosing our products over those of our competitors andpurchasing our products at sufficient volumes and prices. Our competitors’ products may be less costly, provide
better performance, or include additional features when compared to our products. Our long-term ability to sell
system-level memory and storage products is reliant upon our customers’ ability to create, market, and sell theirproducts containing our system-level solutions at sufficient volumes and prices in a timely manner. If we fail tosuccessfully develop and market system-level products, our business, results of operations, or financial condition
may be materially adversely affected.
Manufacturing system-level solutions, such as SSDs, managed NAND, and HBM, typically results in higher per-unit
manufacturing costs as compared to other products. Even if we are successful in selling system-level solutions to
our customers in sufficient volume, we may be unable to generate sufficient profit if our per-unit manufacturing costs
are not offset by higher per-unit selling prices. Manufacturing system-level solutions to customer specifications
requires a longer development cycle, as compared to discrete products, to design, test, and qualify, which may
increase our costs. Some of our system solutions are increasingly dependent on sophisticated firmware that may
require significant customization to meet customer specifications, which increases our costs and time to market.
Additionally, we may need to update our controller and hardware design as well as our firmware or develop new
firmware as a result of new product introductions or changes in customer specifications and/or industry standards,
which increases our costs. System complexities and extended warranties for system-level products could also
increase our warranty costs. Our failure to cost-effectively manufacture system-level solutions and/or controller,
hardware design, and firmware in a timely manner may result in reduced demand for our system-level products andcould have a material adverse effect on our business, results of operations, or financial condition.

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Products that fail to meet specifications, are defective, or are otherwise incompatible with end uses could
impose significant costs on us.
Products that do not meet specifications or that contain, or are perceived by our customers to contain, defects orthat are otherwise incompatible with end uses could impose significant costs on us or otherwise materially adversely
affect our business, results of operations, or financial condition. From time to time, we experience problems with
nonconforming, defective, or incompatible products after we have shipped such products. In recent periods, wehave further diversified and expanded our product offerings, which could potentially increase the chance that one ormore of our products could fail to meet specifications in a particular application. Our products and solutions may bedeemed fully or partially responsible for functionality in our customers’ products and may result in sharing or shiftingof product or financial liability from our customers to us for costs incurred by the end user as a result of ourcustomers’ products failing to perform as specified. In addition, if our products and solutions perform critical
functions in our customers’ products or are used in high-risk consumer end products, such as autonomous driverassistance programs, home and enterprise security, smoke and noxious gas detectors, medical monitoring
equipment, or wearables for child and elderly safety, our potential liability may increase. We could be adversely
affected in several ways, including the following:•••

we may be required or agree to compensate customers for costs incurred or damages caused by defective
or incompatible products and to replace products;
we could incur a decrease in revenue or adjustment to pricing commensurate with the reimbursement ofsuch costs or alleged damages; andwe may encounter adverse publicity, which could cause a decrease in sales of our products or harm our
reputation or relationships with existing or potential customers.

Any of the foregoing items could have a material adverse effect on our business, results of operations, or financial
condition.
Breaches of our security systems or products, or those of our customers, suppliers, or business partners,
could expose us to losses.
We maintain a system of controls over the physical security of our facilities. We also manage and store various
proprietary information and sensitive or confidential data relating to our operations. In addition, we process, store,
and transmit large amounts of data relating to our customers and employees, including sensitive personal
information. Unauthorized persons, employees, former employees, nation states, or other parties may gain accessto our facilities or technology infrastructure and systems through fraudulent means to steal trade secrets or otherproprietary information, compromise confidential information, create system disruptions, or cause shutdowns. Thisrisk is exacerbated as competitors for talent, particularly engineering talent, attempt to hire our employees. Throughcyberattacks on technology infrastructure and systems, unauthorized parties may obtain access to computer
systems, networks, and data, including cloud-based platforms. The technology infrastructure and systems of our
suppliers, vendors, service providers, cloud solution providers, and partners have in the past experienced, and may
in the future experience, such attacks, which could impact our operations. Cyberattacks can include ransomware,computer denial-of-service attacks, worms, supply chain attacks, social engineering, open source vulnerabilities,
and other malicious software programs or other attacks, including those using techniques that change frequently or
may be disguised or difficult to detect, or designed to remain dormant until a triggering event, impersonation of
authorized users, and efforts to discover and exploit any design flaws, “bugs,” security vulnerabilities, as well as
intentional or unintentional acts by employees or other insiders with access privileges. Additionally, some actors areusing artificial intelligence technology to launch more automated, targeted, and coordinated attacks. Globally,
cyberattacks are increasing in number and the attackers are increasingly organized and well-financed, or supported
by state actors, and are developing increasingly sophisticated systems to not only attack, but also to evadedetection. In addition, geopolitical tensions or conflicts may create a heightened risk of cyberattacks. Breaches ofour physical security, attacks on our technology infrastructure and systems, or breaches or attacks on ourcustomers, suppliers, or business partners who have confidential or sensitive information regarding us and ourcustomers and suppliers, could result in significant losses and damage our reputation with customers and suppliers
and may expose us to litigation if the confidential information of our customers, suppliers, or employees iscompromised.

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Our products are also targets for cyberattacks, including those products utilized in cloud-based environments. Whilesome of our products contain encryption or security algorithms designed to protect third-party content or usergenerated data stored on our products, these products could still be hacked or the encryption schemes could becompromised, breached, or circumvented by motivated and sophisticated attackers. Further, our products containsophisticated hardware and firmware and applications that may contain security vulnerabilities or defects in design
or manufacture, including “bugs” and other problems that could interfere with the intended operation of our products.
To the extent our products are hacked, encryption schemes are compromised, or our suppliers are breached or
attacked, this could harm our business by requiring us to employ additional resources to fix the errors or defects,
exposing us to litigation, claims, and harm to our reputation.
Additionally, we cannot be certain that any applicable insurance coverage we maintain will be adequate or otherwise
protect us with respect to claims, expenses, fines, penalties, business loss, data loss, litigation, regulatory actions,or other impacts arising from security breaches or incidents, or that such coverage will continue to be available on
acceptable terms or at all. Any of the foregoing security risks could have a material adverse effect on our business,
results of operations, or financial condition.
We must attract, retain, and motivate highly skilled employees.
To remain competitive, we must attract, retain, and motivate executives and a highly skilled, diverse workforce, as
well as effectively manage succession for key roles. Competition for experienced employees in our industry can beintense. Hiring and retaining qualified executives and other skilled talent is critical to our business. If our totalcompensation programs, employment benefits, and workplace culture are not viewed as competitive and inclusive,
our ability to attract, retain, and motivate employees could be compromised.
At times, we experience higher levels of attrition, increasing compensation costs, and more intense competition for
talent across our industry. To the extent we experience significant attrition and are unable to timely replace
employees, we could experience a loss of critical skills and reduced employee morale, potentially resulting inbusiness disruptions or increased expenses to address any disruptions. Additionally, changes to immigration
policies in the countries in which we operate, as well as restrictions on travel due to public health crises or othercauses, may limit our ability to hire and/or retain talent in, or transfer talent to, specific locations.
Our inability to attract, retain, and motivate executives and other employees or effectively manage succession of
key roles may inhibit our ability to maintain or expand our business operations.
Compliance with responsible sourcing requirements and any related regulations could increase ouroperating costs, or limit the supply and increase the cost of certain materials, supplies, and services, and if
we fail to comply, customers may reduce purchases from us or disqualify us as a supplier.
We and many of our customers have adopted responsible sourcing programs that require us to meet certain
environmental, social, and governance criteria, and to periodically report on our performance against theserequirements, including that we source the materials, supplies, and services we use and incorporate into the
products we sell as prescribed by these programs. Many customer programs require us to remove a supplier withina prescribed period if such supplier ceases to comply with prescribed criteria, and our supply chain may at any time
contain suppliers at risk of being removed due to non-compliance with responsible sourcing requirements. Some ofour customers may elect to disqualify us as a supplier (resulting in a permanent or temporary loss of sales to suchcustomer) or reduce purchases from us if we are unable to verify that our performance or products (including theunderlying supply chain) meet the specifications of our customers’ responsible sourcing programs on a continuous
basis. Meeting responsible sourcing requirements may increase operating requirements and costs or limit thesourcing and availability of some of the materials, supplies, and services we use, particularly when the availability ofsuch materials, supplies, and services is concentrated to a limited number of suppliers. From time to time, weremove suppliers or require our suppliers to remove suppliers from their supply chains based on our responsible
sourcing requirements or customer requirements, and we or our suppliers may be unable to replace such removed
suppliers in a timely or cost-effective manner. Any inability to replace removed suppliers in a timely or cost effective
manner may affect our ability and/or the cost to obtain sufficient quantities of materials, supplies, and services
necessary for the manufacture of our products. Our inability to replace suppliers we have removed in a timely or
cost-effective manner or comply with customers’ responsible sourcing requirements or with any related regulations
could have a material adverse effect on our business, results of operations, or financial condition.

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Failure to meet environmental, social, and governance expectations or standards or achieve our related
goals could adversely affect our business, results of operations, financial condition, or stock price.
In recent years, there has been an increased focus from stakeholders on environmental, social, and governancematters, including greenhouse gas emissions and climate-related risks, sustainability, renewable energy, water
stewardship, waste management, diversity, equality and inclusion, responsible sourcing and supply chain, humanrights, and social responsibility. Given our commitment to social and environmental issues as it relates to ourbusiness, we actively manage these issues and have established and publicly announced certain goals,
commitments, and targets which we may refine or even expand further in the future. These goals, commitments,
and targets reflect our current plans and aspirations and are not guarantees that we will be able to achieve them.
Achieving these goals may entail significant costs, for example we have entered into several virtual power purchaseagreements to obtain renewable energy credits at a cost that will vary based on future prices for electrical power.
Evolving stakeholder expectations and our efforts to manage these issues, report on them, and accomplish ourgoals present numerous operational, regulatory, reputational, financial, legal, and other risks, any of which could
have a material adverse impact, including on our reputation and stock price.
Such risks and uncertainties include:
•
•
•
•
•
•
•
•
•
•
•

reputational harm, including damage to our relationships with customers, suppliers, investors, governments,
or other stakeholders;adverse impacts on our ability to manufacture and sell products and maintain our market share;
the success of our collaborations with third parties;
increased risk of litigation, investigations, or regulatory enforcement action;
unfavorable environmental, social, and governance ratings or investor sentiment;
diversion of resources and increased costs to control, assess, and report on environmental, social, andgovernance metrics;
our ability to achieve our goals, commitments, and targets within timeframes announced;
increased costs to achieve our goals, commitments, and targets;
unforeseen operational and technological difficulties;
access to and increased cost of capital; andadverse impacts on our stock price.

Any failure, or perceived failure, to meet evolving stakeholder expectations and industry standards or achieve ourenvironmental, social, and governance goals, commitments, and targets could have an adverse effect on ourbusiness, results of operations, financial condition, or stock price.
Acquisitions and/or alliances involve numerous risks.
Acquisitions and the formation or operation of alliances, such as joint ventures and other partnering arrangements,
involve numerous risks, including the following:
•
•
•
•
•
•
•
•
•
•
•

integrating the operations, technologies, and products of acquired or newly formed entities into ouroperations;increasing capital expenditures to upgrade and maintain facilities;
increased debt levels;
the assumption of unknown or underestimated liabilities;
the use of cash to finance a transaction, which may reduce the availability of cash to fund working capital,
capital expenditures, R&D expenditures, and other business activities;
diverting management’s attention from daily operations;managing larger or more complex operations and facilities and employees in separate and diverse
geographic areas;hiring and retaining key employees;
requirements imposed by government authorities in connection with the regulatory review of a transaction,
which may include, among other things, divestitures or restrictions on the conduct of our business or theacquired business;underestimating the costs or overestimating the benefits, including product, revenue, cost and othersynergies and growth opportunities that we expect to realize, and we may not achieve those benefits;
failure to maintain customer, vendor, and other relationships;

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inadequacy or ineffectiveness of an acquired company’s internal financial controls, disclosure controls andprocedures, compliance programs, and/or environmental, health and safety, anti-corruption, humanresource, or other policies or practices; andimpairment of acquired intangible assets, goodwill, or other assets as a result of changing businessconditions or technological advancements.

The global memory and storage industry has experienced consolidation and may continue to consolidate. We
engage, from time to time, in discussions regarding potential acquisitions and similar opportunities. To the extent weare successful in completing any such transactions, we could be subject to some or all of the risks described above.
Acquisitions of, or alliances with, technology companies are inherently risky and may not be successful and could
have a material adverse effect on our business, results of operations, or financial condition.
We have incurred restructure charges and may incur restructure charges in future periods and may notrealize expected savings or other benefits from restructure plans.
In 2023, we initiated a restructure plan in response to challenging industry conditions (the “2023 Restructure Plan”).
Under the 2023 Restructure Plan, we reduced our headcount by approximately 15% through a combination ofvoluntary attrition and personnel reductions. The 2023 Restructure Plan was substantially completed in 2023. In
addition, we may in the future enter into other restructure initiatives in order to, among other items, streamline ouroperations, respond to changes in business conditions, our markets, or product offerings, or to centralize certain key
functions.
We may not realize expected savings or other benefits from our 2023 Restructure Plan or future restructure
activities and may incur additional restructure charges or other losses in future periods associated with otherinitiatives. In connection with any restructure initiatives, we could incur restructure charges, loss of production
output, loss of key personnel, disruptions in our operations, and difficulties in the timely delivery of products, which
could have a material adverse effect on our business, results of operations, or financial condition.

Risks Related to Intellectual Property and Litigation
We may be unable to protect our intellectual property or retain key employees who are knowledgeable ofand develop our intellectual property.
We maintain a system of controls over our intellectual property, including U.S. and foreign patents, trademarks,
copyrights, trade secrets, licensing arrangements, confidentiality procedures, non-disclosure agreements with
employees, consultants, and vendors, and a general system of internal controls. Despite our system of controls over
our intellectual property, it may be possible for our current or future competitors to obtain, copy, use, or disclose,
illegally or otherwise, our product and process technology or other proprietary information. The laws of some foreigncountries may not protect our intellectual property to the same degree as do U.S. laws, and our confidentiality, nondisclosure, and non-compete agreements may be unenforceable or difficult and costly to enforce.
Additionally, our ability to maintain and develop intellectual property is dependent upon our ability to attract, develop,
and retain highly skilled employees. If our competitors or future entrants into our industry are successful in hiring our
employees, they may directly benefit from the knowledge these employees gained while they were under our
employment, and this may also negatively impact our ability to maintain and develop intellectual property.
Our inability to protect our intellectual property or retain key employees who are knowledgeable of and develop our
intellectual property could have a material adverse effect on our business, results of operations, or financial
condition.
Legal proceedings and claims could have a material adverse effect on our business, results of operations,or financial condition.
From time to time, we are subject to various legal proceedings and claims that arise out of the ordinary conduct ofour business or otherwise, both domestically and internationally. Such claims include, but are not limited to,allegations of anticompetitive conduct and infringement of intellectual property. See “Part I. Financial Information –Item 1. Financial Statements – Notes to Consolidated Financial Statements – Contingencies.”

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Any claim, with or without merit, could result in significant legal fees that could negatively impact our financial
results, disrupt our operations, and require significant attention from our management. We may be associated withand subject to litigation, claims, or arbitration disputes arising from, or as a result of:••••our relationships with vendors or customers, supply agreements, or contractual obligations with our
subcontractors or business partners;
the actions of our vendors, subcontractors, or business partners;
our indemnification obligations, including obligations to defend our customers against third-party claims
asserting infringement of certain intellectual property rights, which may include patents, trademarks,
copyrights, or trade secrets; andthe terms of our product warranties or from product liability claims.

As we continue to focus on developing system solutions with manufacturers of consumer products, including
autonomous driving, augmented reality, and others, we may be exposed to greater potential for personal liability
claims against us as a result of consumers’ use of those products. We, our officers, or our directors could also be
subject to claims of alleged violations of securities laws. There can be no assurance that we are adequately insured
to protect against all claims and potential liabilities, and we may elect to self-insure with respect to certain matters.
Exposures to various legal proceedings and claims could lead to significant costs and expenses as we defend
claims, are required to pay damage awards, or enter into settlement agreements, any of which could have amaterial adverse effect on our business, results of operations, or financial condition.
Claims that our products or manufacturing processes infringe or otherwise violate the intellectual property
rights of others, or failure to obtain or renew license agreements covering such intellectual property, could
materially adversely affect our business, results of operations, or financial condition.
As is typical in the semiconductor and other high technology industries, from time to time others have asserted, andmay in the future assert, that our products or manufacturing processes infringe upon, misappropriate, misuse, orotherwise violate their intellectual property rights. We are unable to predict the outcome of these assertions madeagainst us. Any of these types of claims, regardless of the merits, could subject us to significant costs to defend or
resolve such claims and may consume a substantial portion of management’s time and attention. As a result of
these claims, we may be required to:••••

pay significant monetary damages, fines, royalties, or penalties;
enter into license or settlement agreements covering such intellectual property rights;
make material changes to or redesign our products and/or manufacturing processes; and/or
cease manufacturing, having made, selling, offering for sale, importing, marketing, or using products and/or
manufacturing processes in certain jurisdictions.

We may not be able to take any of the actions described above on commercially reasonable terms and any of theforegoing results could have a material adverse effect on our business, results of operations, or financial condition.
See “Part I. Financial Information – Item 1. Financial Statements – Notes to Consolidated Financial Statements –Contingencies.”
We have a number of intellectual property license agreements. Some of these license agreements require us tomake one-time or periodic payments. We may need to obtain additional licenses or renew existing license
agreements in the future. We are unable to predict whether these license agreements can be obtained or renewedon terms acceptable to us. The failure to obtain or renew licenses as necessary could have a material adverse
effect on our business, results of operations, or financial condition.

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Risks Related to Laws and Regulations
Government actions and regulations, such as export restrictions, tariffs, and trade protection measures,
may limit our ability to sell our products to certain customers or markets, or could otherwise restrict ourability to conduct operations.
International trade disputes, geopolitical tensions, and military conflicts have led, and continue to lead, to new andincreasing export restrictions, trade barriers, tariffs, and other trade measures that can increase our manufacturingcosts, make our products less competitive, reduce demand for our products, limit our ability to sell to certain
customers or markets, limit our ability to procure, or increase our costs for, components or raw materials, impede or
slow the movement of our goods across borders, impede our ability to perform R&D activities, or otherwise restrict
our ability to conduct operations. Increasing protectionism, economic nationalism, and national security concerns
may lead to further changes in trade policy, domestic sourcing initiatives, or other formal and informal measures that
could make it more difficult to sell our products in, or restrict our access to, some markets and/or customers. For
example, following the May 21, 2023 decision of its cybersecurity review of our products sold in China, the CAC
determined that critical information infrastructure operators in China may not purchase Micron products, impacting
our revenue with companies headquartered in mainland China and Hong Kong, including direct sales as well as
indirect sales through distributors. Some revenue with customers headquartered outside of China has also been
impacted. Further actions by the Chinese government could impact additional revenue inside or outside China, or
our operations in China, or our ability to ship products to our customers, any of which could have a material adverse
effect on our business, results of operations, or financial condition.
We cannot predict what further actions may ultimately be taken with respect to export regulations, tariffs, or othertrade regulations between the United States and other countries, what products or companies may be subject tosuch actions, or what actions may be taken by other countries in retaliation. Further changes in trade policy, tariffs,
restrictions on exports or other trade barriers, or restrictions on supplies, equipment, and raw materials includingrare earth minerals, may limit our ability to produce products, increase our selling and/or manufacturing costs,
decrease margins, reduce the competitiveness of our products, or inhibit our ability to sell products or purchasenecessary equipment and supplies. Such changes may also result in reputational harm to us, the development or
adoption of technologies that compete with our products, long-term changes in global trade and technology supply
chains, or negative impacts on our customers’ products which incorporate our solutions. Any of the effects describedin this risk factor could have a material adverse effect on our business, results of operations, or financial condition.
The technology industry is subject to intense media, political, and regulatory scrutiny, which can increase our
exposure to government investigations, legal actions, and penalties. Although we have policies, controls, andprocedures designed to help ensure compliance with applicable laws, there can be no assurance that ouremployees, contractors, suppliers, or agents will not violate such laws or our policies. Violations of trade laws,
restrictions, or regulations can result in fines; criminal sanctions against us or our officers, directors, or employees;
prohibitions on the conduct of our business; and damage to our reputation.
Tax-related matters could have a material adverse effect on our business, results of operations, or financial
condition.
We are subject to income taxes in the United States and many foreign jurisdictions. Our provision for income taxes
and cash tax liabilities in the future could be adversely affected by numerous factors, including changes in thegeographic mix of our earnings among jurisdictions, challenges by tax authorities to our tax positions andintercompany transfer pricing arrangements, failure to meet performance obligations with respect to tax incentive
agreements, expanding our operations in various countries, fluctuations in foreign currency exchange rates,
adverse resolution of audits and examinations of previously filed tax returns, and changes in tax laws andregulations.

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Changes to income tax laws and regulations, or the interpretation of such laws, in any of the jurisdictions in which
we operate could significantly increase our effective tax rate and ultimately reduce our cash flows from operating
activities and otherwise have a material adverse effect on our financial condition. Beginning in 2024, the Inflation
Reduction Act of 2022 imposes a 15% book minimum tax on corporations with three-year average annual adjusted
financial statement income exceeding $1 billion. The impact of this tax will depend on our facts in each year,
anticipated guidance from the U.S. Department of the Treasury, and other developing global tax legislation. Further
changes in the tax laws of foreign jurisdictions could arise as a result of the base erosion and profit shifting project
undertaken by the Organisation for Economic Co-operation and Development (“OECD”). In December 2022, theEuropean Union (“EU”) member states reached an agreement to implement the minimum tax component (“Pillar
Two”) of the OECD’s tax reform initiative. The directive has been enacted or will be enacted retroactively to be ineffect as of January 1, 2024 in nearly all EU member states. If similar directives under Pillar Two are adopted bytaxing authorities in other countries where we do business, such changes could have a material adverse effect on
our business, results of operations, or financial condition.
We and others are subject to a variety of complex and evolving laws, regulations, or industry standards,
including with respect to environmental, health, safety, and product considerations, which may have amaterial adverse effect on our business, results of operations, or financial condition.
The manufacture of our products requires the use of facilities, equipment, chemicals, and materials that are subject
to a broad array of laws and regulations in numerous jurisdictions in which we operate. Additionally, we are subject
to a variety of other laws and regulations relative to the construction, maintenance, and operations of our facilities.
Any changes in laws, regulations, or industry standards could cause us to incur additional direct costs, as well as
increased indirect costs related to our relationships with our customers and suppliers, and otherwise harm ouroperations and financial condition. Any failure to comply with laws, regulations, or industry standards could
adversely impact our reputation and our financial results. Additionally, we engage various third parties as sales
channel partners or to represent us or otherwise act on our behalf who are also subject to a broad array of laws,
regulations, and industry standards. Our engagement with these third parties may also expose us to risks
associated with their respective compliance with laws and regulations.
New and evolving environmental health, safety, and product considerations, including those related to greenhousegas emissions and climate change, the purchase, use and disposal of regulated and/or hazardous chemicals, andthe potential resulting environmental, health or safety impacts, may result in new laws, regulations, or industry
standards that may affect us, our suppliers, and our customers. Such laws, regulations, or industry standards could
cause us to incur additional direct costs for compliance, as well as increased indirect costs resulting from ourcustomers, suppliers, or both incurring additional compliance costs that are passed on to us. These costs may
adversely impact our results of operations and financial condition.
New and evolving cybersecurity, data privacy, and artificial intelligence laws and regulations impose requirements
for information confidentiality, integrity, availability, personal and proprietary data collection, storage, use, sharing,deletion, and artificial intelligence solutions that must be transparent, fair, secure, human-focused, and accountable.
Such laws, standards, and market expectations could cause us to incur additional direct costs for compliance, as
well as increased indirect costs resulting from our customers, suppliers, or partners reluctance to share information
or solutions due to actual or perceived inadequate controls. These costs may adversely impact our operations andfinancial condition.
As a result of the considerations detailed in this risk factor, we could experience the following:
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•

suspension of production or sales of our products;
limited supplies of chemicals or materials used to make our products;
remediation costs;
increased compliance costs;
alteration of our manufacturing processes;
regulatory penalties, fines, civil or criminal sanctions, and other legal liabilities; andreputational challenges.

Compliance with, or our failure, or the failure of our third-party sales channel partners or agents, to comply with,laws, regulations, or industry standards could have a material adverse effect on our business, results of operations,or financial condition.

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Risks Related to Capitalization and Financial Markets
We may be unable to generate sufficient cash flows or obtain access to external financing necessary tofund our operations, make scheduled debt payments, pay our dividend, and make adequate capital
investments.
Our cash flows from operations depend primarily on the volume of semiconductor memory and storage products
sold, average selling prices, and manufacturing costs. To develop new product and process technology, support
future growth, achieve operating efficiencies, and maintain product quality, we must make significant capital
investments in manufacturing technology, capital equipment, facilities, R&D, and product and process technology.
We estimate capital expenditures in 2024 for property, plant, and equipment, net of proceeds from government
incentives, to be approximately $8.0 billion.
In the past, we have utilized external sources of financing when needed. As a result of our debt levels, expecteddebt amortization, prevailing interest rates, and general capital market and other economic conditions, it may bedifficult for us to obtain financing on terms acceptable to us or at all. We have experienced volatility in our cash flows
and operating results and we expect to continue to experience such volatility in the future, which may negatively
affect our credit rating. Our credit rating may also be affected by our liquidity, financial results, economic risk, orother factors, which may increase the cost of borrowings and make it difficult for us to obtain financing on terms
acceptable to us or at all. There can be no assurance that we will be able to generate sufficient cash flows, access
capital or credit markets, or find other sources of financing to fund our operations, make debt payments, refinanceour debt, pay our quarterly dividend, and make adequate capital investments to remain competitive in terms oftechnology development and cost efficiency. Our inability to do any of the foregoing could have a material adverse
effect on our business, results of operations, or financial condition.
Debt obligations could adversely affect our financial condition.
We have incurred in the past, and expect to incur in the future, debt to finance our capital investments, businessacquisitions, and to realign our capital structure. As of May 30, 2024, we had debt with a carrying value of $13.26
billion and may incur additional debt, including under our $2.50 billion Revolving Credit Facility. Our debt obligations
could adversely impact us as follows:
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•
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•

require us to use a large portion of our cash flow to pay principal and interest on debt, which will reduce theamount of cash flow available to fund our business activities;
adversely impact our credit rating, which could increase borrowing costs;
limit our future ability to raise funds for capital expenditures, strategic acquisitions or business opportunities,
R&D, and other general corporate requirements;
restrict our ability to incur specified indebtedness, create or incur certain liens, and enter into saleleaseback financing transactions;increase our vulnerability to adverse economic and industry conditions;increase our exposure to rising interest rates from variable rate indebtedness; andresult in certain of our debt instruments becoming immediately due and payable or being deemed to be in
default if applicable cross default, cross-acceleration and/or similar provisions are triggered.

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Our ability to meet our payment obligations under our debt instruments depends on our ability to generatesignificant cash flows or obtain external financing in the future. This, to some extent, is subject to market, economic,
financial, competitive, legislative, and regulatory factors as well as other factors that are beyond our control. Therecan be no assurance that our business will generate cash flow from operations, or that additional capital will beavailable to us, in amounts sufficient to enable us to meet our debt payment obligations and to fund other liquidity
needs. Additionally, events and circumstances may occur which would cause us to not be able to satisfy applicabledraw-down conditions and utilize our Revolving Credit Facility. In light of industry conditions, in 2023, we amended
the financial covenants in our Revolving Credit Facility and term loan agreements. See “Part I. Financial Information– Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview” and“Part I. Financial Information - Item 1. Financial Statements – Notes to Consolidated Financial Statements – Debt.”
If we are unable to generate sufficient cash flows to service our debt payment obligations or satisfy our debt
covenants, we may need to refinance, restructure, or amend the terms of our debt, sell assets, reduce or delay
capital investments, or seek to raise additional capital. If we are unable to implement one or more of thesealternatives, we may be unable to meet our debt payment obligations, which could have a material adverse effecton our business, results of operations, or financial condition.
Changes in foreign currency exchange rates could materially adversely affect our business, results ofoperations, or financial condition.
Across our global operations, significant transactions and balances are denominated in currencies other than the
U.S. dollar (our reporting currency), primarily the Chinese yuan, euro, Indian rupee, Japanese yen, Malaysian
ringgit, New Taiwan dollar, and Singapore dollar. In addition, a significant portion of our manufacturing costs aredenominated in foreign currencies. Exchange rates for some of these currencies against the U.S. dollar have beenvolatile and may be volatile in future periods. If these currencies strengthen against the U.S. dollar, ourmanufacturing costs could significantly increase. Exchange rates for the U.S. dollar that adversely change against
our foreign currency exposures could have a material adverse effect on our business, results of operations, or
financial condition.
We are subject to counterparty default risks.
We have numerous arrangements with financial institutions that subject us to counterparty default risks, including
cash deposits, investments, and derivative instruments. Additionally, we are subject to counterparty default risk fromour customers for amounts receivable from them. As a result, we are subject to the risk that the counterparty will
default on its performance obligations. A counterparty may not comply with its contractual commitments which could
then lead to its defaulting on its obligations with little or no notice to us, which could limit our ability to mitigate our
exposure. Additionally, our ability to mitigate our exposures may be constrained by the terms of our contractual
arrangements or because market conditions prevent us from taking effective action. If one of our counterparties
becomes insolvent or files for bankruptcy, our ability to recover any losses suffered as a result of that counterparty’s
default may be limited by the liquidity of the counterparty or the applicable laws governing the bankruptcy
proceedings. In the event of such default, we could incur significant losses, which could have a material adverse
effect on our business, results of operations, or financial condition.
The trading price of our common stock has been and may continue to be volatile.
Our common stock has experienced substantial price volatility in the past and may continue to do so in the future.
Additionally, we, the technology industry, and the stock market as a whole have on occasion experienced extreme
stock price and volume fluctuations that have affected stock prices in ways that may have been unrelated to thespecific operating performance of individual companies. The trading price of our common stock may fluctuate widely
due to various factors, including, but not limited to, actual or anticipated fluctuations in our financial condition andoperating results, changes in financial forecasts or estimates by us or financial or other market estimates andratings by securities and other analysts, changes in our capital structure, including issuance of additional debt orequity to the public, interest rate changes, regulatory changes, news regarding our products or products of ourcompetitors, and broad market and industry fluctuations.
For these reasons, investors should not rely on recent or historical trends to predict future trading prices of ourcommon stock, financial condition, results of operations, or cash flows. Investors in our common stock may notrealize any return on their investment in us and may lose some or all of their investment. Volatility in the trading
price of our common stock could also result in the filing of securities class action litigation matters, which could
result in substantial costs and the diversion of management time and resources.

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The amount and frequency of our share repurchases may fluctuate, and we cannot guarantee that we will
fully consummate our share repurchase authorization, or that it will enhance long-term shareholder value.
Share repurchases could also increase the volatility of the trading price of our stock and will diminish our
cash reserves.
The amount, frequency, and execution of our share repurchases pursuant to our share repurchase authorization
may fluctuate based on our operating results, cash flows, and priorities for the use of cash for other purposes. Our
expenditures for share repurchases were $425 million in 2023, $2.43 billion in 2022, $1.20 billion in 2021,$176 million in 2020, and $2.66 billion in 2019. These other purposes include, but are not limited to, operational
spending, capital spending, acquisitions, and repayment of debt. Other factors, including changes in tax laws, could
also impact our share repurchases. Although our Board of Directors has authorized share repurchases of up to $10
billion of our outstanding common stock, the authorization does not obligate us to repurchase any common stock.
We cannot guarantee that our share repurchase authorization will be fully consummated or that it will enhance longterm shareholder value. The repurchase authorization could affect the trading price of our stock and increase
volatility, and any announcement of a pause in, or termination of, this program may result in a decrease in the
trading price of our stock. In addition, this program will diminish our cash reserves.
There can be no assurance that we will continue to declare cash dividends in any particular amounts or atall.
Our Board of Directors has adopted a dividend policy pursuant to which we currently pay a cash dividend on ourcommon shares on a quarterly basis. The declaration and payment of any dividend is subject to the approval of our
Board of Directors and our dividend may be discontinued or reduced at any time. There can be no assurance that
we will declare cash dividends in the future in any particular amounts, or at all.
Future dividends, if any, and their timing and amount, may be affected by, among other factors: our financial
condition, results of operations, capital requirements, business conditions, debt service obligations, contractual
restrictions, industry practice, legal requirements, regulatory constraints, and other factors that our Board of
Directors may deem relevant. A reduction in or elimination of our dividend payments could have a negative effect on
the trading price of our stock.

19 | 2024 Q3 10-Q