Micron Technology Inc. shares declined in the extended session Thursday after the memory-chip maker said it was taking steps to emerge from a current downcycle in the market by scaling back plans to build out capacity.
Micron MU, shares fell by 1% after a 1.9% decline to close the regular session at $50.01. Micron shares are down 46% for the year, compared with a 24% drop in the S&P 500 index SPX and a 31% drop in the Nadsaq Composite Index COMP. The share on revenue was $5.71 billion, according to analysts.
Read: Microsoft, Google parent Alphabet, and nearly a fifth of S&P 500 hits 52 week lows.
The company last quarter was the first major chip maker this year to admit that there may be pockets of oversupply in the chip market after two years of COVID 19 pandemic-driven shortages.
Sanjay Mehrotra, Micron's chief executive, said in a statement that we are taking decisive steps to reduce supply growth, including a nearly 50% wafer-fab equipment capex cut versus last year.
In the year-ago period, Micron reported net income of $1.49 billion, or $1.35 a share, compared with $2.72 billion, or $2.39 a share. Stock-based compensation expenses and other items were excluded from adjusted earnings, which was $1.45 a share, compared to $2.42 a share in the year-ago period.
Revenue fell to $6.64 billion from $8.27 billion in the year-ago quarter.
Analysts had forecast adjusted earnings of $1.37 a share on revenue of $6.73 billion, based on Micron's forecast of $1.43 to $1.83 a share on revenue of $6.8 billion to $7.6 billion.
Read: Intel CEO takes over Nvidia with a new launch.
Micron specializes in memory chips, such as NAND and DRAM. DRAM, or dynamic random access memory, is the type of memory commonly used in PCs and servers, while NAND chips are the flash memory chips used in smaller devices like smartphones and USB drives.
Over the past 12 months, Micron shares have declined 30%, while the PHLX Semiconductor Index SOX has dropped 28%, the S&P 500 has declined 16%, and the tech-heavy Nasdaq has fallen 26%.