The good news keeps coming for Micron Technology Inc. (MU) investors.
During Monday’s trading session, the chipmaker’s share price climbed 3.91% after trade tensions between the U.S. and China began to thaw and the company raised its third-quarter profit and revenue forecast. Micron’s shares then rose a further 4.79% after markets closed, following the announcement of a $10 billion stock repurchase program and a deal with Intel Corp. (INTC) to produce and ship the next generation of chips used in flash drives and digital cameras.
At its investor day conference in New York City, the Boise, Idaho-based company pledged to repurchase $10 billion shares, the equivalent of about 16 percent of its market value. Micron’s chief financial officer and senior vice president David Zinsner said after the final bell rang on Monday that the buyback, the chipmaker’s biggest one yet, will begin in its 2019 fiscal year and forms part of the company’s plans to return at least 50% of free cash flow to shareholders next year.
“The data-driven economy will transform nearly every industry, and drive secular growth in demand for memory and storage," Sanjay Mehrotra, president and CEO of Micron, added in a statement issued by the company. “Micron is exceptionally well positioned to capitalize on these opportunities and deliver strong business performance and robust free cash flow. Our business results have dramatically strengthened Micron's balance sheet and this stock buyback program emphasizes our ongoing commitment to enhancing shareholder value."
In a separate announcement, Micron revealed that it had also inked a deal with Intel to manufacture and ship the world’s highest-density 3D NAND flash memory chip.
"With [the] introduction of 64-layer 4bits/cell NAND technology, we are achieving 33 percent higher array density compared to TLC, which enables us to produce the first commercially available 1 terabit die in the history of semiconductors," said Scott DeBoer, Micron’s technology development executive vice president. "We're continuing flash technology innovation with our 96-layer structure, condensing even more data into smaller spaces, unlocking the possibilities of workload capability and application construction."
Micron shares have risen 34.92% year to date.