Micron Technology, Inc.MU

Market position and competition · Competitive pressure and market share loss

We face intense competition in the semiconductor memory and storage markets from a number of companies, including Samsung Electronics Co., Ltd.; SK hynix Inc.; Kioxia Holdings Corporation; Sandisk Corporation; ChangXin Memory Technologies, Inc. ('CXMT'); and Yangtze Memory Technologies Co., Ltd. ('YMTC'). Our competitors may use aggressive pricing to obtain market share.

Market position and competition · Pricing pressure and margin compression

Over the past five fiscal years, annual percentage changes in DRAM and NAND average selling prices have ranged from an increase of approximately 200% to a decrease of approximately 50%. In recent periods, industry demand has outpaced supply, driving average selling prices higher, but as we and others increase supply, average selling prices may decline, particularly if demand growth slows or declines.

Customer and revenue · Customer concentration and key customer dependence

In 2026, over half of our total revenue came from our top ten customers. Among our end markets, approximately 60% of our total revenue was concentrated in the data center end market. A disruption in our relationship with any of our top customers or a significant decrease in demand for our data center products could adversely affect our business.

Innovation and product development · Intellectual property protection and infringement

We maintain a system of controls over our intellectual property, including U.S. and foreign patents, trademarks, copyrights and trade secrets through licensing arrangements, confidentiality procedures, non-disclosure agreements with employees, consultants, and vendors, and a general system of internal controls. Despite our system of controls over our intellectual property, it may be possible for our current or future competitors to obtain, copy, use, or disclose, illegally or otherwise, our product and process technology or other proprietary information.

Geopolitical and trade · Political instability and government changes

Political, economic, or other actions may adversely affect our operations in Taiwan. A majority of our DRAM production output in 2026 was from our fabrication facilities in Taiwan, and any loss of output could have a material adverse effect on us.

Geopolitical and trade · Trade policies tariffs and sanctions

Following the May 2023 decision of its cybersecurity review of our products sold in China, the CAC determined that critical information infrastructure operators in China may not purchase Micron products, impacting our revenue with companies headquartered in mainland China and Hong Kong, including direct sales, as well as indirect sales through distributors.

Geopolitical and trade · Government funding and budget changes

We have received, and expect to receive in the future, benefits and incentives from national, state, and local governments in various regions of the world designed to encourage us to establish, maintain, or increase investment, workforce, R&D, or production in those regions. However, there is no guarantee that such government incentives and benefits will continue to be available in the future on the same terms, terms that are acceptable to us or at all.

Economic and market conditions · Economic recession and downturns

Downturns or ongoing adverse conditions in regional or worldwide economies, due to inflation, geopolitics, changes in government borrowing or spending, trade disputes, war, major central bank policy actions, including interest rate increases, public health crises, unemployment, or other factors, have harmed our business in the past, and current and future downturns could also adversely affect our business.

Natural and catastrophic events · Natural disasters and extreme weather

We have manufacturing and other operations in locations subject to natural occurrences and possible climate changes, such as severe and variable weather and geological events resulting in increased costs, or disruptions to our manufacturing operations or those of our suppliers or customers. In addition, climate change may pose physical risks to our manufacturing facilities or our suppliers' facilities, including increased extreme weather events that could result in supply delays or disruptions.

Natural and catastrophic events · Pandemic and public health crises

Other events, including political or public health crises, such as an outbreak of contagious diseases, may also affect our production capabilities or that of our suppliers, including as a result of quarantines, closures of production facilities, lack of supplies, or delays caused by restrictions on travel or shipping.

Core operations · Capacity utilization and efficiency

A significant portion of our manufacturing costs are fixed and do not vary proportionally with changes in production output. As a result, lower utilization, lower wafer output, and corresponding increases in our per gigabit manufacturing costs could result in higher inventory carrying costs, and have had, and may in the future have, an adverse effect on our gross margins, business, results of operations, or financial condition.

Supply chain and procurement · Supplier operation and dependance

Our supply chain and operations are dependent on the availability of materials that meet exacting standards and the use of third parties to provide us with components and services. We generally have multiple sources of supply for our materials and services. However, only a limited number of suppliers are capable of delivering certain materials, components, and services that meet our standards and, in some cases, materials, components, or services are provided by a single or sole source.

Supply chain and procurement · Raw material availability and cost volatility

Certain materials are primarily available in a limited number of countries, including rare earth elements, minerals, and metals. Trade disputes, geopolitical tensions, economic circumstances, political conditions, or public health issues may limit our ability to obtain such materials. Although these rare earth and other materials are generally available from multiple suppliers, China is a predominant producer of these materials.

Supply chain and procurement · Transportation and logistics disruption

Disruptions in transportation lines could delay our receipt of materials. Our ability to procure components to repair equipment essential for our manufacturing processes could also be negatively impacted by various restrictions or disruptions in supply chains, among other items.

Core operations · Operational disruption and business continuity

From time to time, there have been disruptions in our manufacturing operations as a result of power outages, improperly functioning equipment and facilities, disruptions in supply of raw materials or components, equipment failures, or the lack of availability of water, electricity, or labor resources to support our existing operations or planned expansions.

Core operations · Quality control and product defects

Products that do not meet specifications or that contain, or are perceived by our customers to contain, defects or that are otherwise incompatible with end uses could impose significant costs on us or otherwise materially adversely affect our business, results of operations, or financial condition.

Human capital and workforce · Talent acquisition and retention

To stay competitive, we need a highly skilled, global workforce and effective succession management for key roles. Hiring, retaining, and motivating qualified executives and other skilled talent is critical to our business. Competition for highly skilled talent can be intense, particularly as continued growth and investment across the industry increases demand for individuals with specialized technical, operational, leadership, and other critical skills.

Human capital and workforce · Labor relations and union negotiations

Certain of our employees have formed or joined labor unions, and additional unionization efforts may occur in the future. Labor unions representing a portion of our workforce have been engaged in union organizing and collective bargaining activities, including formal mediations (which, if not successful, could permit strike actions), and public demands for revised incentive structures.

Digital transformation and innovation · Artificial intelligence and automation

We are increasingly incorporating AI capabilities into the development of technologies and our business operations, and into our products and services. Our use of such technologies may create dependencies on third-party AI providers. Any disruptions, security incidents, changes in business practices, contractual terms, service availability, or functionality affecting such providers could adversely affect our operations, costs, innovation efforts, or competitive position.

Industry regulation · Regulatory compliance and changes

We and others are subject to a variety of complex and evolving laws, regulations, or industry standards, including with respect to environmental, health, safety, and product considerations, which may have a material adverse effect on our business, results of operations, or financial condition.