2008 CEO/COO Message
Micron began fiscal 2008 with a hope that the memory industry would move in a positive direction. Unfortunately, the environment we find ourselves in today is much worse than a year ago. We now accompany many other companies from various industries in experiencing a worldwide economic downturn. We are fortunate, however, that while we hoped for the best, we prepared for the worst. As we entered fiscal 2008, we focused on restructuring the Company to reestablish our leadership position in the industry. More specifically:
1. We streamlined our operations around the world, allowing us to perform at a higher level with fewer resources;
2. We determined those functions and services best performed outside the Company and transitioned them to our partners; and
3. We established aggressive benchmark targets involving productivity and product cost efficiencies.
We are pleased to report through these and other measures, we achieved our objective. For the sixth straight year, Micron increased its revenue and continued to generate cash flow from operations contributing to our strong balance sheet—a defining difference between us and the competition. We were able to meet many of our aggressive internal cost goals and reduce our DRAM manufacturing cost per bit by approximately 35 percent and our NAND manufacturing cost per bit by approximately 65 percent. We made significant technological progress in the areas of Mobile LPDRAM, SSDs and High-Speed NAND and introduced nearly a dozen new products, including the industry’s first sub-40 nanometer NAND flash device. Micron also received numerous top supplier awards from key customers and multiple environmental honors.
Additionally, we strengthened the Company by forming a DRAM development and manufacturing partnership with Nanya Technology Corporation and Inotera Memories. This partnership will further drive scale and operating efficiencies and will play a significant role in our future DRAM operations.
In summary, we know this has been a very difficult year for investors. Despite our competitiveness, the market environment continued to put pressure on our bottom line, and our net loss for the year was significant. However, it is important to note that 2008 marked our 30th anniversary. During these past 30 years, we have accomplished a great deal. Micron is now not only the sole U.S.-based company in the DRAM industry, but also the longest surviving. While we are again hoping for a better year, rest assured we are taking all of the necessary steps to prepare for another challenging period. Regardless of what occurs, we intend to be well positioned for the years ahead. We thank our team members, customers and shareholders for their support during these extraordinary times and we will do all we can to lead our industry into the future.
Steve Appleton, Chairman and Chief Executive Officer
Mark Durcan, President and Chief Operating Officer