The Boise, Idaho, chipmaker reported fourth quarter revenue of $889 million and fiscal 2003 year-end results of nearly $3.1 billion, which was a 19% increase over fiscal 2002.

Micron blamed the quarterly loss on a 30% year-over-year decline in average selling prices for its mainstream 256Mbit DDR SDRAM.

The company did note that fourth quarter sales volume slightly outstripped production, leaving Micron with lower finished goods inventories both sequentially and year over year.

Micron reported an 8% sequential increase in Mbit production, following increases of about 10% and 20% in the second and third quarters. The company attributed the gains a shift to 0.13 micron process technology, a transition to 0.11 micron devices, and improved manufacturing yields.

"We are pleased with the manufacturing cost reductions achieved over the past three quarters, and anticipate comparable reductions over the next couple of quarters as the benefits of maturing yields and the further migration to .11 micron devices are realized," said Micron president and chief executive Steve Appleton in a statement.

The Intel investment marks a continued interest by the Santa Clara, Calif., chip giant in the fortunes of the DRAM industry. Intel invested $500 million in Micron in 1998 and has since taken equity stakes in several other DRAM vendors -- mostly recently a $100 million investment in Elpida Memory Inc. which it disclosed in June.

In the latest transaction with Intel, Micron said it would be paid $450 million in exchange for the issuance of stock rights exchangeable into approximately 33.9 million shares of Micron common stock.

The investment was made "in the context of comprehensive business agreements between the two companies confirming an ongoing, close relationship between the companies and alignment of business interests, including deployment of DDR2 memory and 300 mm wafer processing," Micron said in its statement.

By: DocMemory
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