Shares of Micron Technology rose Wednesday after the company announced a surprise first-quarter profit on strong demand for memory chips.
The Boise, Idaho-based company had net income of $1 million for the first quarter of its fiscal 2004, which ended Dec. 4, on sales of $1.1 billion. That compares to a $316 million net loss on sales of $685 million in the same period a year earlier.
The results also increased sequentially from the company"s fiscal fourth quarter because of an approximate 15 percent increase in megabits sold and a 7 percent increase in average megabit selling prices. That reflected a trend toward improved market conditions across the semiconductor industry, and cost reductions were a factor as well, the company said. Revenue increases are likely to be the rule over the next two years for manufacturers of dynamic RAM, the main memory in personal computers and servers, according to market researcher IDC.
Micron"s numbers also marked the first quarterly profit in three years for the DRAM manufacturer.
"We are pleased with the improvements in gross margin accomplished over successive quarters," Steve Appleton, Micron"s chief executive and president, said in a statement. "The first-quarter gross margin of 26 percent is, in part, a result of worldwide cost reduction efforts, gains in manufacturing efficiencies and our leadership in process technology."
In a holiday-shortened session, Micron"s shares were up around 40 cents, or about 3 percent, in late-morning trading to $13.56.