UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 28, 2020

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to

Commission file number 1-10658

Micron Technology, Inc.

(Exact name of registrant as specified in its charter)

Delaware		75-1618004
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)
8000 S. Federal Way, Boise, Idaho		83716-9632
(Address of principal executive offices)		(Zip Code)
Registrant’s telephone number, including area code		(208) 368-4000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.10 per share	MU	Nasdaq Global Select Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.					Yes	☒	No	☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).					Yes	☒	No	☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer	Accelerated Filer	Non-Accelerated Filer	Smaller Reporting Company	Emerging Growth Company
☒	☐	☐	☐	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.								☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).					Yes	☐	No	☒

The number of outstanding shares of the registrant’s common stock as of June 23, 2020 was 1,110,998,472.

Micron Company Profile
Founded over 40 years ago on October 5, 1978 Headquartered in Boise, Idaho, USA 4th Largest semiconductor company in the world, excluding IP/software revenue* 18 Countries** 13 Manufacturing sites and 13 customer labs** 37,000 Team members**	Redefining What’s Possible
	The world is moving to a new economic model, where data is driving value creation in ways nobody had imagined just a few years ago.
	Who We Are
	Data is today’s new business currency, and memory and storage are emerging as strategic differentiators that will redefine how we extract value from data to learn, explore, communicate, and experience. Our more than 37,000 team members, in 18 different countries, work with countless customers to innovate every day and pursue the products that will shape how we live and work tomorrow.
	Our Vision
	As a global leader in memory and storage solutions, we are transforming how the world uses information to enrich life by enabling technologies to collect, store, and manage data with unprecedented speed and efficiency. We are accelerating the transformation of information into intelligence – inspiring the world to learn, communicate, and advance faster than ever.
	Our Commitment
*Gartner Market Share: Semiconductors by End Market, Worldwide, 2019 (April 2020) **Micron data as of August 29, 2019.	Our day-to-day operations wouldn’t be possible without our team members’ commitment to business integrity and environmental sustainability. Whether it’s adhering to our professional values or valuing the communities we work in, for us, doing business better means doing business right.
Media Inquiries mediarelations@micron.com Government Inquiries govaffairs@micron.com Investor Inquiries investorrelations@micron.com
	Global Product Portfolio
	DRAM | NAND | 3D XPointTM Memory | NOR | Solid-State Drives High Bandwidth Memory (HBM) | Multichip Packages | Advanced Solutions
	Connect with us on micron.com

© 2020 Micron Technology, Inc. Micron, the Micron logo, the M orbit logo, Intelligence Accelerated^TM, and other Micron trademarks are the property of Micron Technology, Inc. All other trademarks are the property of their respective owners. Products and specifications are subject to change without notice. Rev 03/20

Table of Contents

Introduction		2
Part I. Financial Statements
Item 1.	Financial Statements:
	Consolidated Statements of Operations	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Balance Sheets	5
	Consolidated Statements of Changes in Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
	Results of Operations	29
	Liquidity and Capital Resources	33
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	35
Item 4.	Controls and Procedures	35
Part II. Other Information
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	53
Item 6.	Exhibits	54
Signatures		55

1

Definitions of Commonly Used Terms

As used herein, “we,” “our,” “us,” and similar terms include Micron Technology, Inc. and our consolidated subsidiaries, unless the context indicates otherwise. Abbreviations, terms, or acronyms are commonly used or found in multiple locations throughout this report and include the following:

Term	Definition	Term	Definition
2023 Notes	2.497% Senior Notes due 2023	IMFT	IM Flash Technologies, LLC
2024 Notes	4.640% Senior Notes due 2024	Intel	Intel Corporation
2024 Term Loan A	Senior Term Loan A due 2024	MCP	Multi-Chip Package
2025 Notes	5.500% Senior Notes due 2025	Micron	Micron Technology, Inc. (Parent Company)
2026 Notes	4.975% Senior Notes due 2026	MMJ	Micron Memory Japan, G.K.
2027 Notes	4.185% Senior Notes due 2027	MMT	Micron Memory Taiwan Co., Ltd.
2029 Notes	5.327% Senior Notes due 2029	MTTW	Micron Technology Taiwan, Inc.
2030 Notes	4.663% Senior Notes due 2030	MTU	Micron Technology Utah, LLC
2032D Notes	3.125% Convertible Senior Notes due 2032	Qimonda	Qimonda AG
2033F Notes	2.125% Convertible Senior Notes due 2033	SSD	Solid State Drive
DDR	Double Data Rate	Revolving Credit Facility	$2.5 billion Revolving Credit Facility due July 2023
GDDR	Graphics Double Data Rate	VIE	Variable Interest Entity

Micron Technology, Inc., including its consolidated subsidiaries, is an industry leader in innovative memory and storage solutions. Through our global brands — Micron^® and Crucial^® — our broad portfolio of high-performance memory and storage technologies, including DRAM, NAND, 3D XPoint memory, and NOR, is transforming how the world uses information to enrich life. Backed by more than 40 years of technology leadership, our memory and storage solutions enable disruptive trends, including artificial intelligence, 5G, machine learning, and autonomous vehicles, in key market segments like mobile, data center, client, consumer, industrial, graphics, automotive, and networking.

Micron and the Micron orbit logo are trademarks of Micron Technology, Inc. 3D XPoint is a trademark of Intel in the United States and/or other countries. All other trademarks are the property of their respective owners.

Available Information

Investors and others should note that we announce material financial information about our business and products through a variety of means, including our investor relations website (investors.micron.com), SEC filings, press releases, public conference calls, and webcasts. We use these channels to achieve broad, non-exclusionary distribution of information to the public and for complying with our disclosure obligations under Regulation FD. Therefore, we encourage investors, the media, and others interested in our company to review the information we post on such channels.

Forward-Looking Statements

This Form 10-Q contains trend information and other forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements include, but are not limited to, statements such as those made regarding the impact of coronavirus disease 2019 (“COVID-19”) to our business; the sufficiency of our cash and investments, cash flows from operations, and available financing; and capital spending in 2020. We are under no obligation to update these forward-looking statements. Our actual results could differ materially from our historical results and those discussed in the forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, those identified in “Part II. Other Information – Item 1A. Risk Factors.”

2 | 2020 Q3 10-Q

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Micron Technology, Inc.

Consolidated Statements of Operations

(In millions, except per share amounts)

(Unaudited)

	Quarter ended				Nine months ended
	May 28, 2020		May 30, 2019		May 28, 2020		May 30, 2019
Revenue	$	5,438	$	4,788	$	15,379	$	18,536
Cost of goods sold	3,675		2,960		10,895		9,229
Gross margin	1,763		1,828		4,484		9,307
Selling, general, and administrative	216		206		650		624
Research and development	649		606		1,970		1,818
Other operating (income) expense, net	10		6		18		139
Operating income	888		1,010		1,846		6,726
Interest income	23		52		101		148
Interest expense	(51)		(29)		(144)		(89)
Other non-operating income (expense), net	10		(317)		55		(392)
	870		716		1,858		6,393
Income tax (provision) benefit	(68)		135		(144)		(622)
Equity in net income (loss) of equity method investees	3		—		6		1
Net income	805		851		1,720		5,772
Net income attributable to noncontrolling interests	(2)		(11)		(21)		(20)
Net income attributable to Micron	$	803	$	840	$	1,699	$	5,752
Earnings per share
Basic	$	0.72	$	0.76	$	1.53	$	5.15
Diluted	0.71		0.74		1.50		5.01
Number of shares used in per share calculations
Basic	1,111		1,105		1,110		1,117
Diluted	1,129		1,129		1,131		1,148

See accompanying notes to consolidated financial statements.

3

Micron Technology, Inc.

Consolidated Statements of Comprehensive Income

(In millions)

(Unaudited)

	Quarter ended				Nine months ended
	May 28, 2020		May 30, 2019		May 28, 2020		May 30, 2019
Net income	$	805	$	851	$	1,720	5,772
Other comprehensive income (loss), net of tax
Gains (losses) on derivative instruments	(3)		—		(18)		(6)
Pension liability adjustments	(1)		(1)		(2)		(1)
Gains (losses) on investments	2		3		—		6
Foreign currency translation adjustments	—		—		—		(1)
Other comprehensive income (loss)	(2)		2		(20)		(2)
Total comprehensive income	803		853		1,700		5,770
Comprehensive income attributable to noncontrolling interests	(2)		(11)		(21)		(20)
Comprehensive income attributable to Micron	$	801	$	842	$	1,679	$	5,750

See accompanying notes to consolidated financial statements.

4 | 2020 Q3 10-Q

Micron Technology, Inc.

Consolidated Balance Sheets

(In millions, except par value amounts)

(Unaudited)

As of	May 28, 2020		August 29, 2019
Assets
Cash and equivalents	$	8,267	$	7,152
Short-term investments	391		803
Receivables	3,603		3,195
Inventories	5,405		5,118
Other current assets	233		235
Total current assets	17,899		16,503
Long-term marketable investments	577		1,164
Property, plant, and equipment	30,081		28,240
Intangible assets	332		340
Deferred tax assets	775		837
Goodwill	1,228		1,228
Operating lease right-of-use assets	599		—
Other noncurrent assets	514		575
Total assets	$	52,005	$	48,887
Liabilities and equity
Accounts payable and accrued expenses	$	5,364	$	4,626
Current debt	330		1,310
Other current liabilities	491		454
Total current liabilities	6,185		6,390
Long-term debt	6,356		4,541
Noncurrent operating lease liabilities	540		—
Noncurrent unearned government incentives	553		636
Other noncurrent liabilities	453		452
Total liabilities	14,087		12,019
Commitments and contingencies
Redeemable noncontrolling interest	98		98
Micron shareholders’ equity
Common stock, $0.10 par value, 3,000 shares authorized, 1,192 shares issued and 1,112 outstanding (1,182 shares issued and 1,106 outstanding as of August 29, 2019)	119		118
Additional capital	8,764		8,214
Retained earnings	32,402		30,761
Treasury stock, 80 shares held (76 shares as of August 29, 2019)	(3,454)		(3,221)
Accumulated other comprehensive income (loss)	(11)		9
Total Micron shareholders’ equity	37,820		35,881
Noncontrolling interest in subsidiary	—		889
Total equity	37,820		36,770
Total liabilities and equity	$	52,005	$	48,887

See accompanying notes to consolidated financial statements.

5

Micron Technology, Inc.

Consolidated Statements of Changes in Equity

(In millions)

(Unaudited)

	Micron Shareholders
	Common Stock			Additional Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Total Micron Shareholders’ Equity		Noncontrolling Interest in Subsidiary		Total Equity
	Number of Shares	Amount
Balance at August 29, 2019	1,182	$	118	$	8,214	$	30,761	$	(3,221)	$	9	$	35,881	$	889	$	36,770
Net income	—	—		—		491		—		—		491		15		506
Other comprehensive income (loss), net	—	—		—		—		—		(3)		(3)		—		(3)
Stock issued under stock plans	3	1		31		—		—		—		32		—		32
Stock-based compensation expense	—	—		72		—		—		—		72		—		72
Repurchase of stock	—	—		(6)		(34)		(50)		—		(90)		—		(90)
Acquisition of noncontrolling interest	—	—		123		—		—		—		123		(904)		(781)
Conversion of convertible notes	—	—		(6)		—		—		—		(6)		—		(6)
Balance at November 28, 2019	1,185	$	119	$	8,428	$	31,218	$	(3,271)	$	6	$	36,500	$	—	$	36,500
Net income	—	—		—		405		—		—		405		—		405
Other comprehensive income (loss), net	—	—		—		—		—		(15)		(15)		—		(15)
Stock issued under stock plans	7	—		121		—		—		—		121		—		121
Stock-based compensation expense	—	—		85		—		—		—		85		—		85
Repurchase of stock	(1)	—		(4)		(21)		(45)		—		(70)		—		(70)
Settlement of capped calls	—	—		98		—		(98)		—		—		—		—
Conversion of convertible notes	—	—		(3)		—		—		—		(3)		—		(3)
Balance at February 27, 2020	1,191	$	119	$	8,725	$	31,602	$	(3,414)	$	(9)	$	37,023	$	—	$	37,023
Net income	—	—		—		803		—		—		803		—		803
Other comprehensive income (loss), net	—	—		—		—		—		(2)		(2)		—		(2)
Stock issued under stock plans	1	—		4		—		—		—		4		—		4
Stock-based compensation expense	—	—		82		—		—		—		82		—		82
Repurchase of stock	—	—		—		(3)		(40)		—		(43)		—		(43)
Conversion of convertible notes	—	—		(47)		—		—		—		(47)		—		(47)
Balance at May 28, 2020	1,192	$	119	$	8,764	$	32,402	$	(3,454)	$	(11)	$	37,820	$	—	$	37,820

See accompanying notes to consolidated financial statements.

6 | 2020 Q3 10-Q

Micron Technology, Inc.

Consolidated Statements of Changes in Equity

(In millions)

(Unaudited)

	Micron Shareholders
	Common Stock			Additional Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Total Micron Shareholders’ Equity		Noncontrolling Interest in Subsidiary		Total Equity
	Number of Shares	Amount
Balance at August 30, 2018	1,170	$	117	$	8,201	$	24,395	$	(429)	$	10	$	32,294	$	870	$	33,164
Cumulative effect from adoption of new accounting standard	—	—		—		92		—		—		92		—		92
Net income	—	—		—		3,293		—		—		3,293		—		3,293
Other comprehensive income (loss), net	—	—		—		—		—		(15)		(15)		—		(15)
Stock issued under stock plans	3	—		15		—		—		—		15		—		15
Stock-based compensation expense	—	—		61		—		—		—		61		—		61
Repurchase of stock	(1)	—		108		(11)		(1,933)		—		(1,836)		—		(1,836)
Reclassification of redeemable convertible notes, net	—	—		1		—		—		—		1		—		1
Conversion of convertible notes	—	—		(36)		—		—		—		(36)		—		(36)
Balance at November 29, 2018	1,172	$	117	$	8,350	$	27,769	$	(2,362)	$	(5)	$	33,869	$	870	$	34,739
Net income	—	—		—		1,619		—		—		1,619		5		1,624
Other comprehensive income (loss), net	—	—		—		—		—		11		11		—		11
Stock issued under stock plans	7	1		76		—		—		—		77		—		77
Stock-based compensation expense	—	—		57		—		—		—		57		—		57
Repurchase of stock	(1)	—		(5)		(24)		(702)		—		(731)		—		(731)
Acquisition of noncontrolling interest	—	—		—		—		—		—		—		(12)		(12)
Reclassification of redeemable convertible notes, net	—	—		1		—		—		—		1		—		1
Conversion of convertible notes	—