Micron’s net profit for Q4 2019 plunges by 87% – no thanks to Huawei


Micron
Micron’s net profit for Q4 2019 plunges by 87% – no thanks to Huawei
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The US crackdown on Huawei has already had a serious negative impact on US semiconductor companies. Micron recently released its Q4 financial report for the fiscal year of 2019. Its quarterly revenue was $4.87 billion, a 2% increase from the previous quarter and a 42% decrease from the same period last year. Micron’s net profit fell to $560 million from the $4.3 billion in the same period last year. This is a massive 87% plunge of its net profit.

Micron's net profit

The direct cause of Micron’s revenue and slump in earnings is the decline in flash memory prices. In the Q4 fiscal quarter, the ASP average price of memory dropped another 20 %, making Micron’s earnings plummet. Another important factor to Micron’s poor performance is Huawei. The Chinese manufacturing giant is actually Micron’s largest customer. In 2018, Huawei spent about $2.8 billion Micron’s memory or flash memory chips. The US ban this year did not allow both companies to do many deals. The pressure from the US government is forcing the American chipmaker to restrict dealings with Huawei and this is seriously affecting Micron’s net profit and revenue.

Via

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