Will Micron's Diversification Bring Earnings Stability?

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Part 9
Will Micron's Diversification Bring Earnings Stability? PART 9 OF 9

Inside Micron’s Strategy to Soar in the Mobile Market

Micron’s opportunity in the mobile market

Micron Technology (MU) expects to increase its memory content per device and orders from Apple (AAPL) to drive MBU (mobile business unit) revenue in the future. In this competitive smartphone market, if a flagship phone comes up with 256 GB (gigabyte) memory, the high-end phones follow quickly in upgrading mobile devices.

Notably, Micron’s low-power DRAM 4 improves power efficiency and enables consumers to use their device all day long.

Inside Micron’s Strategy to Soar in the Mobile Market

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Heterogeneous memory

At Analyst Day 2017, Micron’s Vice President for Wireless Solutions, Mike Rayfield, explained how the company plans to leverage its product portfolio in the mobile space.

Micron’s heterogeneous memory, or MCP (multichip package), was earlier used in low- and mid-range phones. The MCP is a combination of NAND, DRAM (dynamic random access memory), controller, and firmware on a single substrate. The company has made some tweaks in the MCP and made it ideal for high range phones.

The company combines 3 GB or 4 GB of DRAM (dynamic random-access memory), 32, 64, and 128 GB of NAND (negative AND) under the MCP. It can also add the next generation memory technology on the substrate. With all these products, Micron only commands around 10% of the market share, which means it has a lot of opportunities to grow.

Notably, Samsung (SSNLF) dominates the mobile memory market.

Flexible architecture

Micron has created a flexible NAND architecture that can be used in storage, mobile, and automotive, depending on market demand. This gives the company a level of flexibility in capacity and helps maintain inventory at desired levels.

The mobile memory products have to get qualified by the handset makers. To reduce the time between design qualification and chip supply, Micron uses its labs across the world to work closely with the SoC (system on chip) and processor suppliers.

Overall, Micron is expanding to new markets and has adopted a flexible architecture to move in and out of the markets depending on the demand. This will likely help the company maintain low costs while delivering higher returns.


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