Micron Technology to lay off 15% worldwide

As part of the restructuring, Micron plans to reduce its global workforce by approximately 15% during the next two years. The majority of the workforce reductions, which will begin with a voluntary program, will occur in Boise as a result of the NAND operation shutdown. Micron is committed to assisting employees affected by the workforce reductions and is providing severance and outplacement services. The combination of declining customer demand and product oversupply in the marketplace has driven selling prices for NAND flash memory significantly below manufacturing costs, particularly for 200 millimeter (mm) manufacturing lines. As a result, IM Flash Technologies (IMFT), a joint venture between Micron and Intel Corporation, will discontinue the supply of NAND flash memory from Micron’s Boise facility (USA). The NAND operation shutdown will reduce IMFT’s NAND flash production by approximately 35,000 wafers (200mm) per month. “Micron is in a strong position relative to our competitors, as evidenced by our balance sheet and cash flow, but we are not immune to the difficult global market conditions that are affecting us all,” said Steve Appleton, Micron Chairman and CEO. “Operation shutdowns and related workforce reductions are always painful, but we are pursuing these actions to maintain the competitiveness of the company.” Cash restructuring and other related expenses are anticipated to be approximately $60 million, and the next year’s cash operating margin benefit is expected to exceed $175 million.