Micron Technology, Inc.
2015 Summer Analyst Day
©2015 Micron Technology, Inc. All rights reserved. Information, products, and/or specifications are subject to change without notice. All information is provided on an “AS IS” basis without warranties of any kind.
regarding products, including regarding their features, availability, functionality, or compatibility, are provided for informational purposes only and do not modify the warranty, if any, applicable to any
1 Statements
©2015 Micron Technology, Inc.
product. Drawings may not be to scale. Micron, the Micron logo, and all other Micron trademarks are the property of Micron Technology, Inc. All other trademarks are the property of their respective owners.
Safe Harbor
During the course of this meeting, we may make projections or other forward-looking statements
regarding future events or the future financial performance of the Company and the industry. We wish
to caution you that such statements are predictions and that actual events or results may differ
materially. We refer you to the documents we file on a consolidated basis from time to time with
Securities and Exchange Commission, specifically our most recent Form 10-K and Form 10-Q. These
documents contain and identify important factors that could cause our actual results on a
consolidated basis to differ materially from those contained in our projections or forward-looking
statements. These certain factors can be found at http://investors.micron.com/riskFactors.cfm.
Although we believe that the expectations reflected in the forward-looking statements are reasonable,
we cannot guarantee future results, levels of activity, performance or achievements. We are under no
duty to update any of the forward-looking statements after the date of the presentation to conform
these statements to actual results.
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©2015 Micron Technology, Inc.
Mark Durcan – Chief Executive Officer
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©2015 Micron Technology, Inc.
Agenda
4
1
Industry Environment
2
Strategic Focus – Key Investments
3
Market Positioning and Operational Focus
4
Technology Roadmap
5
Finance Strategy and Updates
©2015 Micron Technology, Inc.
Semiconductor Cycles
2Q08 to 4Q09 Memory
2Q08 to 4Q09 Semi ex-memory
120%
90%
YoY Quarterly
Revenue
Growth
60%
30%
0%
-30%
-60%
8
7
6
5
4
3
2
1
0
1
Peak to Trough
Data in calendar quarters.
Memory includes DRAM, SRAM, Flash, Mask PROM and EPROM.
Values represent growth of total quarterly revenue over prior year same-quarter revenue. Cycle peaks reflect maximum YoY quarterly growth rates.
Source: WSTS, Micron
©2015 Micron Technology, Inc.
3
4
5
Trough to Peak
Number of Quarters
5
2
6
7
8
Semiconductor Cycles
2Q08 to 4Q09 Memory
1Q10 to 2Q13 Memory
2Q08 to 4Q09 Semi ex-memory
1Q10 to 2Q13 Semi ex-memory
120%
90%
YoY Quarterly
Revenue
Growth
60%
30%
0%
-30%
-60%
8
7
6
5
4
3
2
1
0
1
Peak to Trough
Data in calendar quarters.
Memory includes DRAM, SRAM, Flash, Mask PROM and EPROM.
Values represent growth of total quarterly revenue over prior year same-quarter revenue. Cycle peaks reflect maximum YoY quarterly growth rates.
Source: WSTS, Micron
©2015 Micron Technology, Inc.
3
4
5
Trough to Peak
Number of Quarters
6
2
6
7
8
Semiconductor Cycles
2Q08 to 4Q09 Memory
1Q10 to 2Q13 Memory
3Q13 to Today Memory
2Q08 to 4Q09 Semi ex-memory
1Q10 to 2Q13 Semi ex-memory
3Q13 to Today Semi ex-memory
120%
YoY Quarterly
Revenue
Growth
90%
60%
30%
0%
-30%
-60%
3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 1Q-15 2Q-15
Data in calendar quarters.
Memory includes DRAM, SRAM, Flash, Mask PROM and EPROM.
Values represent growth of total quarterly revenue over prior year same-quarter revenue. Cycle peaks reflect maximum YoY quarterly growth rates.
Source: WSTS, Micron
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©2015 Micron Technology, Inc.
Long-Term Memory Market Conditions
Consolidated Suppliers
 Suppliers with
sufficient scale
 Return-focused
investment and
supply environment
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©2015 Micron Technology, Inc.
Low Supply Growth
 Limited new wafer
capacity
 Slowing technology
migrations
Diversifying Demand
 Differentiated
products
 System solutions
 Diversified customers
 Broadening
applications
DRAM Supply Growth Slowing,
Demand Differentiating
DRAM Industry Y/Y Bit Shipment Growth
120%
100%
2005-2010
CAGR: 52%
100%
Embedded
80%
87%
Enterprise
80%
62%
60%
DRAM Industry Bit Demand Profile
54%
44%
40%
32%
23%
60%
2010-2015
49% CAGR: 32%
31%
23%
Mobile
40%
25% 24%
Stable growth
expected
20%
20%
Client
0%
0%
2000
Technological complexity increasing; wafer
production stable or declining over time
Embedded: AIMM, Consumer, Connected Home
Mobile: Handsets, Tablets
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
Enterprise: Server (Enterprise and Cloud), Networking
Client: PC, Graphics
2015
2019
Aggregate demand increasing, with
continued shift to mobile and enterprise
NAND Supply Growth Slowing,
Growing Demand in SSD and Mobile
NAND Industry Y/Y Bit Shipment Growth
250%
209%
200%
150%
100%
2005-2010
CAGR: 117%
2010-2015
CAGR: 51%
100%
73% 77%
45%
50%
SSD
80%
174%
127%
NAND Industry Bit Demand Profile
62%
41% 41% 37%
34%
New capacity
ROIC
dependent
0%
60%
Mobile
40%
Consumer
20%
Removable &
Other
0%
2005
3D conversion does not result in increased industry
supply growth absent wafer capacity additions
SSD: Client, Data Center, Enterprise SSDs
Consumer: MP3, DSC/DVC, Other Consumer
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
Mobile: Embedded NAND in Handsets and Tablets
Removable & Other: Flash Cards, USB Drives, Other
2015
2019
Aggregate demand increasing, with
significant growth in SSDs and mobile
Micron’s Markets Continue to Grow
$400
$80
$300
$60
$200
$40
$100
$20
$0
$0
2001
2002
2003
2004
2005
Revenues adjusted for inflation, shown in 2014 dollar equivalents.
Inflationary adjustments calculated using GDP Implicit Price Deflator.
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Memory Revenue ($B)
Semiconductor Revenue ($B)
Inflation Adjusted Market TAMs (2014 Dollars)
Real Semi Revenue
Real DRAM Revenue
Real NAND Revenue
Memory Growth Relative to Overall Semiconductors
% of Total Semiconductor
40%
Memory Revenue
Share
35%
30%
Memory Silicon
Share
25%
Linear (Memory
Revenue Share)
20%
Linear (Memory
Silicon Share)
15%
10%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Memory Has Grown in Terms of Both Revenue and Square Inches of Silicon
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
Strategic Focus to Drive Value Creation
Investment for manufacturing and
technology efficiency




20nm DRAM ramp
16nm planar TLC NAND deployment
3D NAND ramp and product enablement
Next generation DRAM and NAND development
Investment for value-added
solutions and emerging technologies




3D XPoint™
Advanced products
Controllers and firmware, SSD portfolio
Advanced packaging solutions
Investment in long-term customer
and partner relationships




Opening and growing new market segments
Leveraging best-in-class expertise
Moving from demand fulfillment to demand creation
Optimizing resources and sharing risk
Focused on Driving Long-Term Shareholder Returns
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©2015 Micron Technology, Inc.
Mark Adams – President
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©2015 Micron Technology, Inc.
Current Memory Market Conditions
 PC demand and market conditions have been challenging
 Mobile, cloud, and specialty DRAM segments have performed better
 Mobile (eMCP) and SSD driving demand growth in NAND
Micron Continues to Leverage Demand Across Diversified End Markets
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©2015 Micron Technology, Inc.
Growing and Diversifying Memory Demand
DRAM Industry Bit Demand (B Gb EU)
NAND Industry Bit Demand (B GB EU)
160
350
140
300
Other
Removable
Storage
Handset
120
Tablet
100
AIMM
Consumer &
Graphics
80
Server/Storage/
Networking
60
250
Consumer
Handset
200
Tablet
150
100
40
Client SSD
Datacenter
SSD
50
20
Enterprise
SSD
PC
0
0
2015
2016
2017
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
2018
2019
2015
2016
2017
2018
2019
Tablets contain a mix of mobile DRAM, standard DRAM, and reduced-power solutions. Upgrade modules included with PC.
Micron’s Value Proposition in Mobile
Customer Requirements
 Energy efficient mobile computer
 Immersive multimedia experience
 Battery life and pleasing form factors
Micron Portfolio
Low Power DRAM
 LPDDR2-LPDDR4, from 4Gb to 32Gb
 Configurations to match any solution
 Enables eMCP innovation
Mobile Managed Memory
 eMMC, eMCP
 Next generation heterogeneous solutions
 Leading-edge packaging technology
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©2015 Micron Technology, Inc.
Micron’s Value Proposition in Automotive
Customer Requirements
Micron Portfolio
 Automotive quality and reliability
 Leading-edge technology
 10+ year longevity
Adoption of Leading Edge Technology
 LPDDR4 in next generation Infotainment
 High density eMMC and SSD (8GB – 240GB)
Enabling Innovation
Infotainment
 Increasing car OEM engagement
 Customer validation labs
Full Auto-grade NVM and DRAM
Instrument
Cluster
Advanced Driver
Assistance Systems (ADAS)
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©2015 Micron Technology, Inc.
 Legacy and mainstream DRAM
 Broad NOR product line
 SLC, MLC, eMMC and SSD NAND
Micron’s Value Proposition in Cloud and Enterprise
Customer Requirements
 Real-time in-memory analytics driving memory content
 High-performance all-flash storage solutions
 Flash-enabled lights-out data centers
Micron’s Technology
 Enterprise-class technology (20nm DRAM, 3D NAND)
 Through-Silicon Via (TSV) for high performance
 Advanced memory systems
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©2015 Micron Technology, Inc.
Micron Portfolio
Server Modules
 Up to 128GB densities
 DDR4 for higher performance
 Load reduction for higher capacity
Enterprise SSD
 Enabled by high performance MLC NAND
 Expanding portfolio: SATA, SAS and PCIe
 Partnership enable go to market
3D XPoint™
 1st new memory technology in 25+ years
 1,000x faster than NAND
 10x denser than conventional memory
Hybrid Memory Cube
 Best-in-class bandwidth
 70% less energy per bit
Micron’s Business is Evolving
Legacy
Component
Business
 OEMs
 OEMs
 Hyperscale
 Channel
 Strategic Partners
 ODM
Demand Fulfillment Relationship
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©2015 Micron Technology, Inc.
Solutions
for
Emerging
Markets
Value
Added
Products
 Verticals/Influencers
–
–
–
–
–
–
–
Financial
Oil & Gas
Automotive
Media
Telecom Service Providers
Medical
Government
Demand Creation Relationship
Our Focus on High Value Products and Segments
DRAM Portfolio ASP/Gb Premium
CQ3-13
CQ4-13
CQ1-14
CQ2-14
CQ3-14
CQ4-14
CQ1-15
CQ2-15
FQ4-13
FQ1-14
FQ2-14
FQ3-14
FQ4-14
FQ1-15
FQ2-15
FQ3-15
Micron Fiscal ASP
Industry ASP Average
Premium
NAND Portfolio ASP/GB Premium
CQ3-13
CQ4-13
CQ1-14
CQ2-14
CQ3-14
CQ4-14
CQ1-15
CQ2-15
FQ4-13
FQ1-14
FQ2-14
FQ3-14
FQ4-14
FQ1-15
FQ2-15
FQ3-15
Trade NAND and DRAM. Intel’s portion of IMFT is excluded.
Source: Micron and Industry Analysts
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©2015 Micron Technology, Inc.
Micron fiscal data shifted to closest calendar quarter.
Investments Will Drive Growth
Micron DRAM / NAND Normalized Bit Output
NAND
DRAM
FY 2015
FY 2016
Muted Growth in FY-15 / 1H-16
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FY 2017
Stronger Growth Beyond
DRAM
• 20nm transition-driven wafer loss
• Mix shift from DDR3 to DDR4 and LP
• Volume ramp of 20nm (to >50% of bits)
NAND
• 3D NAND ramp preparations
• Mix shift towards mobile/eMCP from
high density components
• 3D NAND ramp + TLC impact
©2015 Micron Technology, Inc.
Investments Will Drive Growth
Micron DRAM / NAND Normalized Bit Output
NAND
DRAM
3D XPoint™
FY 2015
FY 2016
Muted Growth in FY-15 / 1H-16
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FY 2017
Stronger Growth Beyond
DRAM
• 20nm transition-driven wafer loss
• Mix shift from DDR3 to DDR4 and LP
• Volume ramp of 20nm (to >50% of bits)
NAND
• 3D NAND ramp preparations
• Mix shift towards mobile/eMCP from
high density components
• 3D NAND ramp + TLC impact
©2015 Micron Technology, Inc.
Investments Will Drive Growth
Two Year CAGR (FY-17 vs. FY-15)1
Bit Shipments
DRAM
NAND
↑ 20-30%
↑ 30-40%
Exiting FY 2017 (FQ4-17 vs. FQ4-15)
Bits per Wafer
DRAM
NAND
1Two-year
24
CAGR comparing total annual FY 2017 vs FY 2015.
©2015 Micron Technology, Inc.
↑ 65-75%
↑ 140-150%
Key Takeaways
 Long-term market opportunities are favorable
 Micron is pursuing high-value markets with a strong value proposition
 We are making risk/reward trade-offs as we engage in new markets
and new/ongoing customer and partner relationships
 Over the next few years we expect to outpace market bit growth
–
–
Fuels top-line growth
Expect premium products to increase as a percentage of total revenue
 We expect to drive relative operating profit expansion
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©2015 Micron Technology, Inc.
Scott DeBoer – Vice President, R&D
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©2015 Micron Technology, Inc.
Responding to Market Needs
Customer Requirements
Technology Solution
High Performance Memory
DRAM scaling continues
High Density Storage
3D NAND scaling for the next
decade
Innovation Creating New
Opportunities
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©2015 Micron Technology, Inc.
3D XPointTM, 3D packaging, other
new memory options
 20nm qualified and ramping in
Hiroshima and Inotera
% of Total Micron
DRAM Bits Produced*
DRAM Update
 20nm yield progressing to plan (ahead of
previous nodes)
 Strong international team focused on
best known practices for innovation and
development
50%
0%
FQ1-16
FQ2-16
FQ3-16
Micron Fiscal Quarter
* Includes Inotera
2xnm DRAM Yield Trend
20nm Actual
25nm Actual
Time from Early Ramp
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©2015 Micron Technology, Inc.
FQ4-16
Yield
 1Xnm (first post-integration technology)
deployed in Hiroshima fab – ramp in
second half 2016
≤20nm DRAM Production
3D NAND Update
Next Major Milestones
Status
 Rapid yield progress on 3D NAND (ahead of plan)
 Ramping TLC products for mobile and storage
 Continuing innovative path to maintain Gb/mm2
leadership
Yield
Early 3D NAND Yield Trend
3D Actual
Planar Actual
Time From Introduction
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©2015 Micron Technology, Inc.
 Continue yield improvement and volume ramp
 Enablement of 2nd generation 3D NAND in
Singapore manufacturing fab
 First wafers out of Singapore expansion in
summer 2016
Singapore
Fab
Expansion
Why Micron and Intel Chose
Floating Gate for 3D NAND
Floating Gate Flash Cell
ee-
Isolated charge
storage node for
good cell to cell
charge isolation
Floating Gate
is a
Charge Trap Flash Cell
Proven
Continuous charge
Technology storage
node prone
e
e
e
Floating Gate is a Proven Technology
 Used in NVM since ’70s and technology of choice for industry NAND today
 Physics and reliability surrounding floating gate are well understood
 Not susceptible to charge spreading
 Expect faster 3D NAND ramp in manufacturing
 Cell enables industry’s highest Gb/mm2 and world’s first 384Gb die (TLC)
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©2015 Micron Technology, Inc.
to charge dispersion
between cells
Micron’s Portfolio of Innovative “Firsts”
DRAM
Package
NAND
New Memory
 6F2 architecture
 Leading DRAM capacitor technology
 Copper metallization
 Pitch multiplication patterning in manufacturing
 Award-winning, industry-leading planar NAND
cell technology
 Air-gap technology implementation
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©2015 Micron Technology, Inc.
 Hybrid memory cube using Through Silicon Via (TSV)
 0.8mm four-layer LPDRAM package, thinnest LPDRAM
memory device in the industry
 Productization of phase change memory technology
 Demonstration of 16Gb resistive RAM
Recent Technology Announcements
Floating Gate 3D NAND
March 2015
 3X higher capacity than existing NAND
technologies due to smallest cell size
 Enables >10TB in a standard 2.5” SSD
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©2015 Micron Technology, Inc.
3D XPoint™ Non-Volatile Memory
July 2015
 1000X faster than NAND
 1000X endurance of NAND
 10X denser than conventional memory
Successful Development Path for 3D XPointTM Memory
Cross-point memory technology has been an
industry “aspiration” for decades

Unique enablers of 3D XPointTM:
–
–
Novel new materials with electrical,
structural, and chemical compatibility
Innovative integration concept
Proprietary and unique to the industry
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
Low latency, high endurance, non-volatile

Selector capable of demanding on/off currents

High endurance memory cell with large window

High performance logic beneath the array

Delivering 128Gb on a single die with a 2 deck
stacked 20nm cross point
©2015 Micron Technology, Inc.
It’s a great time to be a
materials engineer!
3D XPoint™ Enables High Performance Solutions
ENTERPRISE STORAGE
CLASS MEMORY



Saturates the PCIe interface for
reads and writes
High IOPS for low queue
workloads
CLIENT STORAGE


Enables extreme 4K video editing

Cost-sensitive performance with
TLC NAND in the general SSD
market

Unlimited life for 5-year 100%
write workload
Small data sizes with 16GB density
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©2015 Micron Technology, Inc.
MOBILE MEMORY

Non-volatile, high endurance
Eliminates interface bottleneck of
existing NVM storage solutions
Provides lower power standby (no
active refresh)
Optimized for low-latency, small
data transactions
1,000X faster than NAND
Future Memory Technologies
Resistive Memory
+V
Spin Torque Memory
-V
Cu, Ag etc,.
W, TiN etc,.
Cu/Ta
Top lead
CoFeB
MgO
Free layer
Barrier
CoFeB
Fixed layer
PtMn
Antiferromagnet
Cu/Ta
Bottom lead
MTJ
MTJ
 Exploring a broad range of materials
with RRAM capability
 Investigation focused on unique
material system advantages
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©2015 Micron Technology, Inc.
 Unique memory based on electron spin
at the atomic level
 Potential long-term DRAM replacement
 Early application as a high-speed cache
Current Key Technology Priorities
 Continue to build positive momentum in the DRAM technology area
–
Completion of 20nm DRAM ramp on plan
–
Drive faster introduction cadence on DRAM technology with rapid 1Xnm and 1Ynm delivery
 3D NAND and 3D XPointTM technology ramps in 2016
 3D package technology enablement for multiple differentiated opportunities
2017
2016
DRAM
1Xnm
NAND
3D Gen 2
3D Package
New Memory
Position in time indicates volume enablement
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©2015 Micron Technology, Inc.
1Ynm
3D Gen 3
HMC Gen 3
3D X-Pt
3D X-Pt Gen 2
EM Gen 1
Ernie Maddock – Chief Financial Officer
37
©2015 Micron Technology, Inc.
Capital Allocation Strategy
Investment for
manufacturing
and technology
efficiency
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©2015 Micron Technology, Inc.
Investment for
value-added
solutions
Return excess
capital to
shareholders
Investing in Business Growth and Shareholder Returns
FQ1-11 through FQ3-15
 $5.2B cumulative investment in R&D
 $11.6B cumulative investment in capital
expenditures1
 Innovating with new memory
technologies and system-level
solutions
 Managing dilution through ~$3.8B of
convertible note and share repurchases
 Maintaining balance sheet flexibility for
operational/strategic initiatives
1 Includes
39
payments on equipment purchase contracts
©2015 Micron Technology, Inc.
Millions
$25,000
$25
$20,000
$20
$15,000
$15
Capital Return
$10,000
$10
R&D
Capex 1
$5,000$5
$0$0
Significant Increase in Scale and Financial Flexibility
Cash from Operations
Revenue
(% of Sales)
16% CAGR,
~2X Growth
23% CAGR,
~2X Growth
$16.2B
$8.8B
32%
28%
FY2011
FY-11
FY2015E*
FY-151
Capital Expenditures
(% of Sales)
FY2011
FY-11
FY2015E*
FY-151
Free Cash Flow
(% of Sales)
~$1.8B
Increase
33%
FY2011
FY-11
1
2
40
Based on Bloomberg analyst consensus
Based on mid-point of FY 2015 guidance
©2015 Micron Technology, Inc.
9%
23%
FY2015E*
FY-152
FY-11
-4%
FY-151,2
Return of Capital Framework
Established Target
Capital Structure
 Minimum cash target
 Leverage target
 Credit rating target
1
41
Through FQ3-15
©2015 Micron Technology, Inc.
Dilution Management
 Returned ~90% of FY-14
FCF and ~79% in FY-151
 ~$3.8B in convertible
note / share repurchases
Capital Return Policy
 Annual review
 Disciplined approach
based on operational
and strategic initiatives
Dilution Management Results
Millions of Shares
1,300
Start of FY 2014 GAAP Dilutive Shares1
~12% reduction in dilutive shares
for stock price range of $20-$30
1,200
Through FQ3-152
1,100
1,000
$16
$18
$20
$22
$24
$26
$28
$30
$32
$34
$36
From FY 2014 through FQ3 2015, total share reduction of ~141M shares at $202
* Assume FQ3-15 basic shares and stock based compensation for analysis. All transactions assume full quarter of impact.
1 Does not include benefit of capped calls
2 Includes the benefit of capped calls
42
©2015 Micron Technology, Inc.
Financial Performance
 Expanded revenues to $16B+ in FY 2014 with strong operating cash flow
 Diversified market segments, customers and products
 Strengthened balance sheet to support operational/strategic initiatives
 Invested in R&D and capital expenditures to drive technology efficiency
and innovation
 Enabled significant capital return and dilution management
43
©2015 Micron Technology, Inc.
Investments Will Drive Growth
Two Year CAGR (FY-17 vs. FY-15)1
Bit Shipments
DRAM
NAND
↑ 20-30%
↑ 30-40%
Exiting FY 2017 (FQ4-17 vs. FQ4-15)
Bits per Wafer
1Two-year
44
DRAM
↑ 65-75%
NAND
↑ 140-150%
CAGR comparing total annual FY 2017 vs FY 2015.
©2015 Micron Technology, Inc.
FY 2016 Capital Expenditure Guidance: $5.3B to $5.8B
CapEx Breakdown
Technology and Product Enablement
100%
20-30%
40-50%
25-35%
0%
FY 2016
Non-supply related investments with focus on driving nextgeneration memory technologies and packaging capabilities to
enable high-margin, differentiated solutions
 Emerging memory
 Packaging and controller capabilities
 Other investments including R&D fab space in Boise
Non-Volatile Memory
Investments related to 3D NAND development, TLC enablement
and Fab 10X to drive cost reductions and margin improvements
 3D NAND
 Fab 10X facility
 3D XPoint™
DRAM
Investments in leading edge technology to improve efficiencies
and margins
 20nm and 1xnm ramp
Flexible, Return-Focused Capital Expenditure Plan
45
©2015 Micron Technology, Inc.
Normalized FY 2016 Capital Expenditures
Partner
Investments
Total CapEx
Shell
Investments
Normalized
CapEx
FY 2016 Capital Expenditure Guidance: $5.3 - $5.8B
Strategic partner investments: ~$0.7 – $0.9B
Shell investment in Fab 10X: ~$0.6 – $0.8B
Normalized Capital Expenditures of ~$4.1B
46
©2015 Micron Technology, Inc.
Forward Guidance Responds to
Our Changing Business
Value proposition to customers and partners is evolving:
 Creating value beyond component sales
– Multi-chip packages, SSDs, sub-systems and solutions
 Differentiated next generation memory/storage technologies
– 3D XPoint™, HMC, Enterprise SSD, etc.
 Strategic partnerships
Current per-bit metrics are less indicative of market conditions and financial results
47
©2015 Micron Technology, Inc.
Changes to Forward Guidance Effective FQ1-16
Quarterly Guidance Metrics
(on a Total Company, Non-GAAP basis)
Revenue
Gross Margin
Operating Expense
Operating Income
Diluted EPS
We expect quarterly call and financial reporting to be similar to current practice
48
©2015 Micron Technology, Inc.
Executing to a Capital Management Framework
Return on Assets
> Cost of Capital
Weighted Average
Cost of Capital
1
Currently ~10%
Cap Ex / Sales
Value
Creation
Efficient
Free Cash
Flow
Model
Target 20-25% of Sales
1 Weighted
2 LTM
49
average cost of capital as of June 4, 2015, based on Micron’s internal model
SG&A and R&D = $2.2B; Current Debt (based on GAAP value, not principal amount) = $1.2B.
©2015 Micron Technology, Inc.
Strong
Balance
Sheet
Access to
Low-Cost
Capital
Target Minimum
Cash Balance
LTM SG&A +
2
R&D + Current Debt
(Currently ~$3.4B)
Target
Leverage Ratio
GAAP Debt to EBITDA < 1.5x
Financial Takeaways
 Driving long-term returns with focused capital allocation
 Delivering scale, a strong balance sheet, and significant shareholder
returns/dilution management in recent years
 Investing for future growth while remaining flexible and return-focused
 Aligning financial communications to our evolving strategy
 Executing efficient and effective capital management
– FQ4-15 QTD1: Repurchases of ~$0.5B of common shares and ~$0.1B of
convertible notes
1
50
As of August 12, 2015
©2015 Micron Technology, Inc.
Mark Durcan – Chief Executive Officer
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©2015 Micron Technology, Inc.
Analyst Day Summary
Industry conditions remain favorable over the long term:
 Investing in technology, solutions, and strategic relationships to improve
competitive position
 Delivering value-added solutions to our customers in diverse segments
 Focusing on operational execution
 Leveraging world-class technology to enable differentiated solutions
 Deploying efficient and effective capital management
Focused on Driving Long-Term Shareholder Returns
52
©2015 Micron Technology, Inc.
Q&A
53
©2015 Micron Technology, Inc.
54
©2015 Micron Technology, Inc.
Non-GAAP Asset Reconciliation
Amounts in millions
Beginning of period:
Total assets
Cash, current and noncurrent marketable investments
Current and noncurrent restricted cash
Non-controlling share
Non-GAAP total assets
End of period:
Total assets
Cash, current and noncurrent marketable investments
Current and noncurrent restricted cash
Non-controlling share
Non-GAAP total assets
Non-GAAP average total assets
55
©2015 Micron Technology, Inc.
FQ3-15
$
FQ4-14 to FQ3-15
23,818
(6,348)
(67)
(974)
16,429
$
$
$
25,136
(7,330)
(70)
(1,061)
16,675
$
25,136
(7,330)
(70)
(1,061)
16,675
$
16,552
$
15,675
$
$
$
20,495
(4,809)
(62)
(949)
14,675
Adjusted EBITDA Reconciliation
Amounts in millions
56
FQ3-15
LTM
FQ4-14 to FQ3-15
Net income
Interest expense, net
Income tax provision (benefit)
Depreciation expense and amortization of intangible assets
EBITDA
(Income) loss from equity method investees
Restructure and asset impairments
(Gain) loss from asset dispositions or other impairments
(Gain) loss from changes in currency exchange rates
Stock-based compensation
Loss on restructure of debt
(Gain) on Inotera issuance of shares
(Gain) from disposition of shares in Aptina
Legal settlements
$
491
88
104
673
1,356
(68)
1
(4)
(1)
43
18
----
$
3,579
327
139
2,510
6,555
(519)
25
(15)
29
161
61
(93)
(120)
66
Adjusted EBITDA
$
1,345
$
6,150
©2015 Micron Technology, Inc.
Non-GAAP Net Income Reconciliation
Amounts in millions
FQ3-15
GAAP net income attributable to Micron
Non-GAAP adjustments:
Tessera license
Restructure and asset impairments
Amortization of debt discount and other costs
Loss on restructure of debt
(Gain) loss from changes in currency exchange rates
(Gain) from Inotera issuance of shares
(Gain) from disposition of shares in Aptina
Estimated tax effects of above items
Non-cash taxes from MMJ and MMT
Non-cash taxes from MMJ for changes in Japan tax laws and rates
Non-cash taxes from Inotera
$
Non-GAAP net income (loss) attributable to Micron
$
491
LTM
FQ4-14 to FQ3-15
$
-1
34
18
(1)
---22
45
10
620
3,578
66
35
142
65
29
(93)
(120)
(7)
(25)
45
(55)
$
3,660
$
3,660
x4
$
57
©2015 Micron Technology, Inc.
2,480
58
©2015 Micron Technology, Inc.