2014 Q1 Form 10-Q Financial Statement

#000072312514000068 Filed on April 07, 2014

View on sec.gov

Income Statement

Concept 2014 Q1 2013 Q1
Revenue $4.107B $2.078B
YoY Change 97.64% 3.43%
Cost Of Revenue $2.704B $1.712B
YoY Change 57.94% -4.84%
Gross Profit $1.403B $366.0M
YoY Change 283.33% 74.29%
Gross Profit Margin 34.16% 17.61%
Selling, General & Admin $177.0M $123.0M
YoY Change 43.9% -29.31%
% of Gross Profit 12.62% 33.61%
Research & Development $344.0M $214.0M
YoY Change 60.75% -3.6%
% of Gross Profit 24.52% 58.47%
Depreciation & Amortization $486.0M $434.0M
YoY Change 11.98% -20.66%
% of Gross Profit 34.64% 118.58%
Operating Expenses $521.0M $337.0M
YoY Change 54.6% -14.9%
Operating Profit $869.0M -$23.00M
YoY Change -3878.26% -88.73%
Interest Expense $83.00M $56.00M
YoY Change 48.21% 60.0%
% of Operating Profit 9.55%
Other Income/Expense, Net -$122.0M -$159.0M
YoY Change -23.27% -529.73%
Pretax Income $670.0M -$235.0M
YoY Change -385.11% 17.5%
Income Tax $63.00M -$9.000M
% Of Pretax Income 9.4%
Net Earnings $731.0M -$286.0M
YoY Change -355.59% 1.42%
Net Earnings / Revenue 17.8% -13.76%
Basic Earnings Per Share $0.69 -$0.28
Diluted Earnings Per Share $0.61 -$0.28
COMMON SHARES
Basic Shares Outstanding 1.060B shares 1.016B shares
Diluted Shares Outstanding 1.201B shares 1.016B shares

Balance Sheet

Concept 2014 Q1 2013 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $4.504B $2.228B
YoY Change 102.15% 6.4%
Cash & Equivalents $4.305B $2.061B
Short-Term Investments $199.0M $167.0M
Other Short-Term Assets $199.0M $189.0M
YoY Change 5.29% -22.22%
Inventory $2.462B $1.721B
Prepaid Expenses
Receivables $2.548B $998.0M
Other Receivables $277.0M $228.0M
Total Short-Term Assets $9.991B $5.364B
YoY Change 86.26% -5.21%
LONG-TERM ASSETS
Property, Plant & Equipment $7.859B $6.973B
YoY Change 12.71% -5.22%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments $618.0M $291.0M
YoY Change 112.37% -13.13%
Other Assets $487.0M $392.0M
YoY Change 24.23% 1.03%
Total Long-Term Assets $10.62B $8.548B
YoY Change 24.29% 0.8%
TOTAL ASSETS
Total Short-Term Assets $9.991B $5.364B
Total Long-Term Assets $10.62B $8.548B
Total Assets $20.62B $13.91B
YoY Change 48.18% -1.61%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.155B $674.0M
YoY Change 71.36% -16.38%
Accrued Expenses $352.0M $209.0M
YoY Change 68.42% -57.86%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due $2.230B $350.0M
YoY Change 537.14% 133.33%
Total Short-Term Liabilities $5.305B $2.117B
YoY Change 150.59% 0.71%
LONG-TERM LIABILITIES
Long-Term Debt $4.408B $3.301B
YoY Change 33.54% 52.47%
Other Long-Term Liabilities $858.0M $534.0M
YoY Change 60.67% 4.09%
Total Long-Term Liabilities $858.0M $3.835B
YoY Change -77.63% 43.2%
TOTAL LIABILITIES
Total Short-Term Liabilities $5.305B $2.117B
Total Long-Term Liabilities $858.0M $3.835B
Total Liabilities $10.48B $5.952B
YoY Change 76.08% 24.52%
SHAREHOLDERS EQUITY
Retained Earnings $836.0M -$1.963B
YoY Change -142.59% 133.97%
Common Stock $8.389B $9.115B
YoY Change -7.96% 4.09%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $9.284B $7.231B
YoY Change
Total Liabilities & Shareholders Equity $20.62B $13.91B
YoY Change 48.18% -1.61%

Cashflow Statement

Concept 2014 Q1 2013 Q1
OPERATING ACTIVITIES
Net Income $731.0M -$286.0M
YoY Change -355.59% 1.42%
Depreciation, Depletion And Amortization $486.0M $434.0M
YoY Change 11.98% -20.66%
Cash From Operating Activities $1.390B $234.0M
YoY Change 494.02% -59.23%
INVESTING ACTIVITIES
Capital Expenditures -$565.0M -$327.0M
YoY Change 72.78% -16.58%
Acquisitions
YoY Change
Other Investing Activities $34.00M -$33.00M
YoY Change -203.03% -57.14%
Cash From Investing Activities -$531.0M -$360.0M
YoY Change 47.5% -23.24%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -212.0M 85.00M
YoY Change -349.41% 14.86%
NET CHANGE
Cash From Operating Activities 1.390B 234.0M
Cash From Investing Activities -531.0M -360.0M
Cash From Financing Activities -212.0M 85.00M
Net Change In Cash 647.0M -41.00M
YoY Change -1678.05% -122.91%
FREE CASH FLOW
Cash From Operating Activities $1.390B $234.0M
Capital Expenditures -$565.0M -$327.0M
Free Cash Flow $1.955B $561.0M
YoY Change 248.48% -41.93%

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;font-weight:bold;">Recently Issued Accounting Standards</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">There have been no recently issued accounting pronouncements that have had or are expected to have a material impact on our financial statements.</font></div></div>
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CY2014Q1 us-gaap Income Loss From Equity Method Investments
IncomeLossFromEquityMethodInvestments
134000000 USD
us-gaap Income Loss From Equity Method Investments
IncomeLossFromEquityMethodInvestments
-110000000 USD
us-gaap Income Loss From Equity Method Investments
IncomeLossFromEquityMethodInvestments
220000000 USD
us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
4000000 USD
CY2014Q1 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
63000000 USD
us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
143000000 USD
CY2013Q1 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
-9000000 USD
us-gaap Income Tax Holiday Aggregate Dollar Amount
IncomeTaxHolidayAggregateDollarAmount
144000000 USD
CY2014Q1 us-gaap Income Tax Holiday Aggregate Dollar Amount
IncomeTaxHolidayAggregateDollarAmount
68000000 USD
us-gaap Income Tax Holiday Aggregate Dollar Amount
IncomeTaxHolidayAggregateDollarAmount
47000000 USD
CY2013Q1 us-gaap Income Tax Holiday Aggregate Dollar Amount
IncomeTaxHolidayAggregateDollarAmount
36000000 USD
us-gaap Income Tax Holiday Income Tax Benefits Per Share
IncomeTaxHolidayIncomeTaxBenefitsPerShare
0.12
us-gaap Income Tax Holiday Income Tax Benefits Per Share
IncomeTaxHolidayIncomeTaxBenefitsPerShare
0.05
CY2014Q1 us-gaap Income Tax Holiday Income Tax Benefits Per Share
IncomeTaxHolidayIncomeTaxBenefitsPerShare
0.06
CY2013Q1 us-gaap Income Tax Holiday Income Tax Benefits Per Share
IncomeTaxHolidayIncomeTaxBenefitsPerShare
0.04
CY2014Q1 us-gaap Income Taxes Receivable
IncomeTaxesReceivable
65000000 USD
CY2013Q3 us-gaap Income Taxes Receivable
IncomeTaxesReceivable
74000000 USD
us-gaap Increase Decrease In Customer Advances
IncreaseDecreaseInCustomerAdvances
153000000 USD
us-gaap Increase Decrease In Customer Advances
IncreaseDecreaseInCustomerAdvances
-63000000 USD
us-gaap Increase Decrease In Deferred Income Taxes
IncreaseDecreaseInDeferredIncomeTaxes
-127000000 USD
us-gaap Increase Decrease In Deferred Income Taxes
IncreaseDecreaseInDeferredIncomeTaxes
0 USD
us-gaap Increase Decrease In Inventories
IncreaseDecreaseInInventories
-27000000 USD
us-gaap Increase Decrease In Inventories
IncreaseDecreaseInInventories
-188000000 USD
us-gaap Increase Decrease In Other Accounts Payable And Accrued Liabilities
IncreaseDecreaseInOtherAccountsPayableAndAccruedLiabilities
489000000 USD
us-gaap Increase Decrease In Other Accounts Payable And Accrued Liabilities
IncreaseDecreaseInOtherAccountsPayableAndAccruedLiabilities
-189000000 USD
us-gaap Increase Decrease In Other Operating Capital Net
IncreaseDecreaseInOtherOperatingCapitalNet
67000000 USD
us-gaap Increase Decrease In Other Operating Capital Net
IncreaseDecreaseInOtherOperatingCapitalNet
-125000000 USD
us-gaap Increase Decrease In Receivables
IncreaseDecreaseInReceivables
3000000 USD
us-gaap Increase Decrease In Receivables
IncreaseDecreaseInReceivables
458000000 USD
us-gaap Increase Decrease In Restricted Cash
IncreaseDecreaseInRestrictedCash
-556000000 USD
us-gaap Increase Decrease In Restricted Cash
IncreaseDecreaseInRestrictedCash
0 USD
CY2014Q1 us-gaap Interest Expense
InterestExpense
83000000 USD
us-gaap Interest Expense
InterestExpense
184000000 USD
us-gaap Interest Expense
InterestExpense
113000000 USD
CY2013Q1 us-gaap Interest Expense
InterestExpense
56000000 USD
CY2014Q1 us-gaap Inventory Finished Goods Net Of Reserves
InventoryFinishedGoodsNetOfReserves
829000000 USD
CY2013Q3 us-gaap Inventory Finished Goods Net Of Reserves
InventoryFinishedGoodsNetOfReserves
796000000 USD
CY2013Q3 us-gaap Inventory Net
InventoryNet
2649000000 USD
CY2014Q1 us-gaap Inventory Net
InventoryNet
2462000000 USD
CY2013Q3 us-gaap Inventory Raw Materials And Supplies Net Of Reserves
InventoryRawMaterialsAndSuppliesNetOfReserves
134000000 USD
CY2014Q1 us-gaap Inventory Raw Materials And Supplies Net Of Reserves
InventoryRawMaterialsAndSuppliesNetOfReserves
186000000 USD
CY2014Q1 us-gaap Inventory Work In Process Net Of Reserves
InventoryWorkInProcessNetOfReserves
1447000000 USD
CY2013Q3 us-gaap Inventory Work In Process Net Of Reserves
InventoryWorkInProcessNetOfReserves
1719000000 USD
CY2014Q1 us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
10000000 USD
CY2013Q1 us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
2000000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
33000000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
2000000 USD
us-gaap Investment Income Interest
InvestmentIncomeInterest
11000000 USD
CY2013Q1 us-gaap Investment Income Interest
InvestmentIncomeInterest
3000000 USD
CY2014Q1 us-gaap Investment Income Interest
InvestmentIncomeInterest
6000000 USD
us-gaap Investment Income Interest
InvestmentIncomeInterest
6000000 USD
CY2014Q1 us-gaap Liabilities
Liabilities
10480000000 USD
CY2013Q3 us-gaap Liabilities
Liabilities
9112000000 USD
CY2013Q3 us-gaap Liabilities And Stockholders Equity
LiabilitiesAndStockholdersEquity
19118000000 USD
CY2014Q1 us-gaap Liabilities And Stockholders Equity
LiabilitiesAndStockholdersEquity
20615000000 USD
CY2013Q3 us-gaap Liabilities Current
LiabilitiesCurrent
4125000000 USD
CY2014Q1 us-gaap Liabilities Current
LiabilitiesCurrent
5305000000 USD
CY2014Q1 us-gaap Long Term Debt And Capital Lease Obligations
LongTermDebtAndCapitalLeaseObligations
4317000000 USD
CY2013Q3 us-gaap Long Term Debt And Capital Lease Obligations
LongTermDebtAndCapitalLeaseObligations
4452000000 USD
us-gaap Loss Contingency Disclosures
LossContingencyDisclosures
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;font-weight:bold;">Contingencies</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have accrued a liability and charged operations for the estimated costs of adjudication or settlement of various asserted and unasserted claims existing as of the balance sheet date, including those described below. We are currently a party to other legal actions arising from the normal course of business, none of which is expected to have a material adverse effect on our business, results of operations or financial condition.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Rambus</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On May 5, 2004, Rambus, Inc. ("Rambus") filed a complaint in the Superior Court of the State of California (San Francisco County) against us and other DRAM suppliers which alleged that the defendants harmed Rambus by engaging in concerted and unlawful efforts affecting Rambus DRAM by eliminating competition and stifling innovation in the market for computer memory technology and computer memory chips.&#160; Rambus' complaint alleged various causes of action under California state law including, among other things, a conspiracy to restrict output and fix prices, a conspiracy to monopolize, intentional interference with prospective economic advantage, and unfair competition. Rambus sought a judgment for damages of approximately $3.9 billion, joint and several liability, trebling of damages awarded, punitive damages, a permanent injunction enjoining the defendants from the conduct alleged in the complaint, interest, and attorneys' fees and costs. Trial began on June 20, 2011, and the case went to the jury on September 21, 2011. On November 16, 2011, the jury found for us on all claims. On April 2, 2012, Rambus filed a notice of appeal to the California 1st District Court of Appeal.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We were engaged in litigation with Rambus relating to certain of Rambus' patents and certain of our claims and defenses. Our lawsuits with Rambus related to patent matters were pending in the U.S. District Court for the District of Delaware, U.S. District Court for the Northern District of California, Germany, France, and Italy.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In December 2013, we settled all pending litigation between us and Rambus, including all antitrust and patent matters.&#160; We also entered into a 7-year term patent cross-license agreement with Rambus that allows us to avoid costs of patent-related litigation during the term.&#160; We agreed to pay Rambus up to $10 million per quarter over seven years, for a total of $280 million, beginning in the second quarter of 2014.&#160; The primary benefits we received from these arrangements were (1) the settlement and termination of all existing litigation, (2) the avoidance of future litigation expenses and (3) the avoidance of future management and customer disruptions.&#160; As a result, other operating expense for the first quarter of 2014 included a $233 million charge to accrue a liability, which reflects the discounted value of amounts due under this arrangement.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Patent Matters</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As is typical in the semiconductor and other high technology industries, from time to time others have asserted, and may in the future assert, that our products or manufacturing processes infringe their intellectual property rights.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On September 1, 2011, HSM Portfolio LLC and Technology Properties Limited LLC filed a patent infringement action in the U.S. District Court for the District of Delaware against us and seventeen other defendants, including Elpida Memory, Inc. and Elpida Memory (USA) Inc. (collectively &#8220;Elpida&#8221;).&#160; On August 22, 2013, the plaintiffs filed a third amended complaint. The third amended complaint alleges that certain of our DRAM and image sensor products infringe four U.S. patents and that certain Elpida DRAM products infringe two U.S. patents and seeks damages, attorneys' fees, and costs. Trial currently is scheduled for February 8, 2016. On March 23, 2012, Elpida filed a Notice of Filing and Hearing on Petition Under Chapter 15 of the U.S. Bankruptcy Code and Issuance of Provisional Relief that included an order of the U.S. Bankruptcy Court for the District of Delaware staying judicial proceedings against Elpida. Accordingly, the plaintiffs' case against Elpida is stayed. </font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On December 5, 2011, the Board of Trustees for the University of Illinois (the "University") filed a patent infringement action against us in the U.S. District Court for the Central District of Illinois. The complaint alleges that unspecified semiconductor products of ours infringe three U.S. patents and seeks injunctive relief, damages, attorneys' fees, and costs. We have filed three petitions for </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">inter-partes</font><font style="font-family:inherit;font-size:10pt;"> review by the Patent and Trademark Office, challenging the validity of each of the patents in suit. The Patent Trial and Appeal Board (&#8220;PTAB&#8221;) held a hearing in connection with the three petitions on December 9, 2013. On March 10, 2014, the PTAB issued written decisions finding that each and every claim in the three patents in suit is invalid, and cancelled all claims. The University has a right to appeal the PTAB rulings to the U.S. Court of Appeals for the Federal Circuit.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On April 27, 2012, Semcon Tech, LLC filed a patent infringement action against us in the U.S. District Court for the District of Delaware. The complaint alleges that our use of various chemical mechanical planarization systems purchased from Applied Materials and others infringes a single U.S. patent and seeks injunctive relief, damages, attorneys' fees, and costs. On September 24, 2013, the Court entered an order staying our case pending the resolution of co-pending cases brought by Semcon Tech, LLC against Applied Materials and Ebara Technologies, Inc. Subsequently these cases were resolved, and on February 21, 2014, the Court lifted the stay of the case against us. Trial currently is for August 21, 2015.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On December 7, 2007, Tessera, Inc. filed a patent infringement against Elpida Memory, Inc., Elpida Memory (USA) Inc. (collectively "Elpida"), and numerous other defendants, in the United States District Court for the Eastern District of Texas. The complaint alleges that certain Elpida products infringe four U.S. patents and seeks injunctive relief, damages, attorneys' fees, and costs. Prior to answering the complaint, Elpida and other defendants filed motions to stay the case pending final resolution of a case before the International Trade Commission ("ITC") against Elpida and other respondents, alleging infringement of the same patents asserted in the Eastern District of Texas case (In The Matter of Certain Semiconductor Chips with Minimized Chip Package Size and Products Containing Same (III), ITC No. 337-TA-630 (the "ITC Action")). On February 25, 2008, the Eastern District of Texas Court granted the defendants' motion to stay the action. On December 29, 2009, the ITC issued a Notice of Final Determination in the ITC Action finding no violation by Elpida. Tessera Inc. subsequently appealed the matter to the U.S. Court of Appeals for the Federal Circuit. On May 23, 2011, the Federal Circuit affirmed the ITC's Final Determination. The Eastern District of Texas case currently remains stayed.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Among other things, the above lawsuits pertain to certain of our DDR, DDR2, DDR3, SDR SDRAM, PSRAM, RLDRAM, LPSDR, NAND Flash, image sensor products and certain other memory products we manufacture, which account for a significant portion of our net sales.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are unable to predict the outcome of assertions of infringement made against us and therefore cannot estimate the range of possible loss. A court determination that our products or manufacturing processes infringe the intellectual property rights of others could result in significant liability and/or require us to make material changes to our products and/or manufacturing processes. Any of the foregoing could have a material adverse effect on our business, results of operations or financial condition.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Antitrust Matters</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">At least sixty-eight purported class action price-fixing lawsuits have been filed against us and other DRAM suppliers in various federal and state courts in the United States and in Puerto Rico on behalf of indirect purchasers alleging a conspiracy to increase DRAM prices in violation of federal and state antitrust laws and state unfair competition law, and/or unjust enrichment relating to the sale and pricing of DRAM products during the period from April 1999 through at least June 2002. The complaints seek joint and several damages, trebled, in addition to restitution, costs and attorneys' fees. A number of these cases were removed to federal court and transferred to the U.S. District Court for the Northern District of California for consolidated pre-trial proceedings. In July, 2006, the Attorneys General for approximately forty U.S. states and territories filed suit in the U.S. District Court for the Northern District of California. The complaints allege, among other things, violations of the Sherman Act, Cartwright Act, and certain other states' consumer protection and antitrust laws and seek joint and several damages, trebled, as well as injunctive and other relief. On October 3, 2008, the California Attorney General filed a similar lawsuit in California Superior Court, purportedly on behalf of local California government entities, alleging, among other things, violations of the Cartwright Act and state unfair competition law. On June&#160;23, 2010, we executed a settlement agreement resolving these purported class-action indirect purchaser cases and the pending cases of the Attorneys General relating to alleged DRAM price-fixing in the United States. Subject to certain conditions, including final court approval of the class settlements, we agreed to pay approximately $67 million in aggregate in three equal installments over a two-year period. We paid the full amount into an escrow account by the end of the first quarter of 2013 in accordance with the settlement agreement.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On June 21, 2010, the Brazil Secretariat of Economic Law of the Ministry of Justice ("SDE") announced that it had initiated an investigation relating to alleged anticompetitive activities within the DRAM industry. The SDE's Notice of Investigation names various DRAM manufacturers and certain executives, including us, and focuses on the period from July 1998 to June 2002.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are unable to predict the outcome of these matters and therefore cannot estimate the range of possible loss, except as noted in the above discussion of the U.S. indirect purchaser cases. The final resolution of these alleged violations of antitrust laws could result in significant liability and could have a material adverse effect on our business, results of operations or financial condition.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Securities Matters</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On July 12, 2013, seven former shareholders of Elpida Memory, Inc. ("Elpida") filed a complaint against Messrs. Sakamoto, Adachi, Gomi, Shirai, Tsay-Jiu, Wataki, Kinoshita, and Takahasi in their capacity as members of the board of directors of Elpida as of February 2013. The complaint alleges that the defendants engaged in various acts and misrepresentations to hide the financial condition of Elpida and deceive shareholders prior to Elpida filing a petition for corporate reorganization on February 27, 2013. The plaintiffs seek joint and several damages equal to the market value of shares owned by each of the plaintiffs on February 23, 2013, along with attorneys&#8217; fees and interest. At a hearing on September 25, 2013, the plaintiffs withdrew the complaint against Mr. Tsay-Jiu.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are unable to predict the outcome of this matter and therefore cannot estimate the range of possible loss.&#160; The final resolution of this matter could result in significant liability and could have a material adverse effect on our business, results of operations or financial condition.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Qimonda</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On January 20, 2011, Dr. Michael Jaff&#233;, administrator for Qimonda AG ("Qimonda") insolvency proceedings, filed suit against Micron Technology, Inc. (&#8220;Micron Technology&#8221;) and Micron Semiconductor B.V., our Netherlands subsidiary (&#8220;Micron B.V.&#8221;), in the District Court of Munich, Civil Chamber. The complaint seeks to void under Section 133 of the German Insolvency Act a share purchase agreement between Micron B.V. and Qimonda signed in fall 2008 pursuant to which Micron B.V. purchased substantially all of Qimonda's shares of Inotera Memories, Inc. (the &#8220;Inotera Shares&#8221;) and seeks an order requiring us to retransfer those shares to the Qimonda estate. The complaint also seeks, among other things, to recover damages for the alleged value of the joint venture relationship with Inotera and to terminate under Sections 103 or 133 of the German Insolvency Code a patent cross-license between us and Qimonda entered into at the same time as the share purchase agreement.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Following a series of hearings with pleadings, arguments and witnesses on behalf of the Qimonda estate, on March 13, 2014, the Court issued judgments:&#160; (i) ordering Micron B.V. to pay approximately $1 million in respect of certain Inotera shares sold in connection with the original share purchase; (ii) ordering Micron B.V. to disclose certain information with respect to any Inotera Shares sold by it to third parties; (iii) ordering Micron B.V. to disclose the benefits derived by it from ownership of the Inotera Shares, including in particular, any profits distributed on such shares and all other benefits; (iv) denying Qimonda&#8217;s claims against Micron Technology for any damages relating to the joint venture relationship with Inotera; and (v) determining that Qimonda's obligations under the patent cross-license agreement are cancelled. In addition, the Court issued interlocutory judgments ordering, among other things:&#160; (i) that Micron B.V. transfer to the Qimonda estate the Inotera Shares still owned by it and pay to the Qimonda estate compensation in an amount to be specified for any Inotera Shares sold to third parties; and (ii) that Micron B.V. pay the Qimonda estate as compensation an amount to be specified for benefits derived by it from ownership of the Inotera Shares. The interlocutory judgments have no immediate, enforceable effect on us, and, accordingly, we expect to be able to continue to operate with full control of the Inotera Shares subject to further developments in the case. All of these judgments are immediately appealable, and we have until April 28, 2014 to file a notice of appeal.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are unable to predict the outcome of the matter and therefore cannot estimate the range of possible loss. The final resolution of this lawsuit could result in the loss of the Inotera shares or equivalent monetary damages, unspecified damages based on the benefits derived by Micron B.V. from the ownership of the Inotera Shares, and/or the termination of the patent cross-license, which could have a material adverse effect on our business, results of operation or financial condition.&#160; As of February 27, 2014, the Inotera Shares had a carrying value for purposes of our financial reporting of $312 million and a market value of $1,002 million.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Other</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the normal course of business, we are a party to a variety of agreements pursuant to which we may be obligated to indemnify the other party. It is not possible to predict the maximum potential amount of future payments under these types of agreements due to the conditional nature of our obligations and the unique facts and circumstances involved in each particular agreement. Historically, our payments under these types of agreements have not had a material adverse effect on our business, results of operations or financial condition.</font></div></div>
CY2014Q1 us-gaap Minority Interest
MinorityInterest
760000000 USD
CY2013Q3 us-gaap Minority Interest
MinorityInterest
864000000 USD
us-gaap Minority Interest Decrease From Distributions To Noncontrolling Interest Holders
MinorityInterestDecreaseFromDistributionsToNoncontrollingInterestHolders
19000000 USD
us-gaap Minority Interest Decrease From Distributions To Noncontrolling Interest Holders
MinorityInterestDecreaseFromDistributionsToNoncontrollingInterestHolders
0 USD
us-gaap Minority Interest Decrease From Redemptions
MinorityInterestDecreaseFromRedemptions
136000000 USD
us-gaap Minority Interest Decrease From Redemptions
MinorityInterestDecreaseFromRedemptions
0 USD
us-gaap Net Cash Provided By Used In Financing Activities Continuing Operations
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dei Amendment Flag
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dei Current Fiscal Year End Date
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dei Document Period End Date
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dei Document Type
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dei Entity Central Index Key
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CY2014Q2 dei Entity Common Stock Shares Outstanding
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dei Entity Filer Category
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dei Entity Registrant Name
EntityRegistrantName
MICRON TECHNOLOGY INC

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0000723125-14-000068.txt Edgar Link pending
0000723125-14-000068-xbrl.zip Edgar Link pending
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a2014q2ex10-3.htm Edgar Link pending
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a2014q2ex32-1906ceocert.htm Edgar Link pending
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