When the chips are down, do not hold too many of them

Micron Technology reported a $344m loss for the fourth quater, in large part due to a $205m write-down of memory chip inventory.  They report that DRAM chips fell 5% in price from the third quarter and NAND chips fell 15% over the same period.  Those price-decline rates translate to about 19% and 48% on an annual basis.  Holding even an extra week of inventory in such a climate is very expensive!

Wall Street Journal, October 1, 2008 – Micron Post $344 Million Loss


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