Earnings and revenues of Micron Technology, Inc. (NASDAQ: MU), dropped sharply in the fourth quarter as the chipmaker continues to bear the brunt of the slowdown in demand. The results, meanwhile, came in above the market’s prediction. The stock fell sharply Thursday evening as the company provided a disappointing outlook.
Adjusted earnings, excluding special items, plunged to $0.56 per share in the fourth quarter from $3.53 per share a year earlier but exceeded the forecast. Unadjusted profit was $561 million or $0.49 per share, compared to $4.33 billion or $3.56 per share in the fourth quarter of 2018.
The dismal bottom-line performance reflects a 42% fall in revenues to $4.87 billion. Analysts were looking for a faster decline. All the four business segments recorded a double-digit decline in revenues.
“Micron delivered fourth quarter results ahead of expectations, capping a fiscal 2019 in which we executed well in a challenging environment, significantly improved our competitive position, and returned cash to shareholders through share repurchases,” said CEO Sanjay Mehrotra.
Looking ahead, the management expects revenues to be $5 billion, plus or minus $200 million, in the first quarter of 2010. The estimate for adjusted earnings is $0.46 per share, plus or minus seven cents. Unadjusted earnings are expected to be $0.42 per share, plus or minus seven cents. The company is looking for a gross margin of approximately 25.5% for the current quarter.
During the fiscal year ended August, the management repurchased shares for about $2.66 billion. While predicting an improvement in demand conditions in the coming months, the company cautioned about near-term macroeconomic and trade-related uncertainties.
Earlier this month, Micron’s shares climbed to the highest level in more than a year, continuing the recovery from the loss it suffered a few months ago. The stock, which gained about 50% so far this year, closed Thursday’s regular trading lower and continued to fall during the after-hours session immediately after the earnings announcement.