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Behind Micron’s Priorities under New Management

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Micron’s new management priorities

Micron Technology’s (MU) management has four new people from SanDisk, a leader in the SSD (solid-state drive) market that was acquired by Western Digital (WDC) in mid-2016.

As Micron’s new CEO (chief executive officer), Sanjay Mehrotra listed his priorities for the next few quarters during the fiscal 3Q17 earnings call and at KeyBanc’s Global Technology Leadership Forum. Mehrotra stated that he would focus on two perspectives: improving cost competitiveness and adding value-add solutions to the product mix.

Micron will likely continue to develop cost-effective products and accelerate its volume production to gain a cost advantage over competitors. Over the past 12 months (ended fiscal 3Q17), Micron has reduced the cost per bit of its DRAM and trade NAND by ~25% and 30%, respectively.

Micron also plans to focus on value-add solutions by increasing the mix of system-level solutions. It’s looking to develop differentiating solutions by strengthening its capabilities in controller, firmware, and software.

On the DRAM side, Micron will likely focus on offering high-performance, low-latency memory, and storage systems that address the AI (artificial intelligence) needs of accessing, processing, analyzing, and inferencing data faster. On the NAND side, it will likely focus on a mix of SSD.

As Micron has advanced technology in both DRAM and NAND, Mehrotra appears to be eying opportunities for MCP (multi chip package) solutions, especially in the mobile space.

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Micron’s execution

All this raises the question as to how Micron plans to execute these priorities. Mehrotra stated that the company would partner with leading companies in the ecosystem to develop value-add solutions. It has already created a memory chip research center in the US to design specialized memory products for automotive and AI and to develop new manufacturing processes for its plants worldwide.

Although the new research center doubles the scale of Micron’s R&D (research and development) function, it’s still lower than that of Samsung (SSNLF).

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