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Micron suffers from sluggish PC market, yet again

Posted: 05 Oct 2015 ?? ?Print Version ?Bookmark and Share

Keywords:Micron Technology? PC market? Intel? processor? DRAM?

Micron Technology Inc. has revealed a third straight quarter of falling revenue resulting from the persistent decline of the PC market. The company attributed the fiscal Q4 sales decline primarily to a seven per cent drop in DRAM average selling prices and relatively flat DRAM sales volume. DRAM revenue, which accounted for 60 per cent of the company's fiscal Q4 sales, plummeted eight per cent sequentially.

Non-volatile memory sales also declined by seven per cent in the quarter as the result of lower sales volume, Micron continued.

"While Q4 results were impacted by continued weakness in the PC sector, we believe memory industry fundamentals remain favourable over the long term and we are focused on improving our competitive position through deployment of advanced technologies and system level solutions," said Mark Durcan, Micron's CEO.

General sluggishness in the PC market in recent years as consumer increasingly adopted more mobile forms of computing was exacerbated for much of 2015 as buys delayed PC prices ahead of the launch of Windows 10. While the new version of Windows, released in August, is expected to fuel a slight uptick in PC buys for the remainder of the year, it is unlikely to propel the market to growth. Market watchers Gartner Inc. and International Data Corp. forecast that the PC market will decline this year by between four per cent and five per cent.

While the PC market remains sluggish, Micron continues to see healthy demand for its memory chips in other end markets, Durcan said.

While Durcan made it clear that Micron has not seen signs of an uptick in PC demand, he did say the company does not see excess inventory of PCs or PC parts in the supply channel. "As we sit today, the relative channel inventory in PCs is not a huge burden to recovery," Durcan said. "I think it's too early to tell what consumers and even in the corporate environment are going to be doing through the holidays and through the rest of the year."

Durcan said sluggish PC demand is not an inventory problem, but a demand problem. PC OEMs and distributors were cautious about adding inventory ahead of the launch of Windows 10 and the sixth generation of Intel Corp.'s core processor, codenamed Skylake, which was released in August, he said.

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