Good afternoon. My name is Huey and I'll be your conference facilitator today. At this time I'd like to welcome everyone to Micron Technology's Fourth Quarter and Fiscal Year End 2013 Financial Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. (Operator instructions). It is now my pleasure to turn the floor over to your host, Kipp Bedard. Sir, you may begin your conference.

Thank you, very much and welcome to Micron Technology's fourth quarter and fiscal yearend 2013 financial release conference call. On the call today is Mr. Mark Durcan, CEO and Director; Mark Adams, President; and Ron Foster, Chief Financial Officer and Vice President of Finance. This conference call, including audio and slides, is also available on our website at micron.com. If you have not had an opportunity to review the fourth quarter and fiscal yearend 2013 financial press release, again, it is available on our website at micron.com. Our call will be approximately 60 minutes in length. There will be an audio replay of this call, accessed by dialing 404-537-3406, with the confirmation code of 71010239. This replay will run through Thursday, October 17, 2013, at 5.30 pm Mountain Time. A webcast replay will be available on the Company's website until October 2014. We encourage you to monitor our website at micron.com throughout the quarter for the most current information on the Company including information on the various financial conferences that we will be attending. Please note the following Safe Harbor statement. During the course of this meeting, we may make projections or other forward-looking statements regarding future events or the future financial performance of the Company and the industry. We wish to caution you that such statements are predictions, and that actual events or results may differ materially. We refer you to the documents the Company files on a consolidated basis from time-to-time with the Securities and Exchange Commission, specifically the Company's most recent Form 10-K and Form 10-Q. These documents contain and identify important factors that could cause the actual results for the Company on a consolidated basis to differ materially from those contained in our projections or forward-looking statements. These certain factors can be found in the Investor Relations section of Micron's website. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of the presentation to conform these statements to actual results. Thank you. I'd like to now turn the call over to Mark Durcan. Mark?

Thanks, Kipp. I'd like to start today with an overview of the key developments during the quarter, followed by a few strategic and industry thoughts. Then I'll turn it over to Ron for a financial summary. And before turning to Q&A, we'll close our prepared comments with Mark Adams covering additional details of our business units and operational performance and market conditions. Our fourth fiscal quarter was highlighted by the long anticipated closing of the Elpida acquisition. I want to thank all our team members, whether from Micron, Elpida or Rexchip for all their hard work getting us to this point. While we were able to get a good head start on planning and technology development, integration is now in full swing and we hit the ground running with solid combined financial performance in Q4. We expect this execution to continue in Q1 as we take advantage of the strong market conditions along with enhanced scale technology, cost and customer positioning. Our DRAM business roughly doubled overnight as Elpida and Rexchip delivered scale in the PC segment and a leading mobile product portfolio that dovetails nicely with Micron's strength and other specialty DRAM categories such as networking, server and [AIM]. We were also very happy with the performance of our new Japanese team in the graphics arena and expect significant growth in that segment driven by next generation gaming consoles hitting the market soon. Mobile DRAM is now in the mid to high 30% range of our DRAM bits with PC in a similar range and server in the mid-teens. While consumer, networking and storage and [AIM] are all in the single-digits as a percentage of bits, they remain higher than that in terms of revenue. In summary, we have a large product portfolio in every critical segment of the…

Thanks, Mark. Our fourth quarter and fiscal year ended on August 29. Our website has a schedule containing certain key results for the fourth quarter as well as guidance for the first quarter of fiscal 2014. That information is also presented on the following slides. For our 2013 fiscal year, we reported net income of $1.2 billion or $1.13 per diluted share on net sales of $9.1 billion. The results for the year include one month of the consolidated results of Elpida since our acquisition closed on July 31. Elpida's results included Rexchip. The $1.5 billion non-operating gain recognized as part of the purchase accounting of Elpida is the result of the fair values of the assets and liabilities acquired being in excess of the purchase price. Operating income for 2013, which excludes the gain on the Elpida acquisition, improved to $236 million compared to an operating loss of $612 million in fiscal 2012 as market conditions for memory products improved significantly around the beginning of this calendar year. The schedule currently displayed summarizes the purchase accounting for Elpida. Several noteworthy items include. The $2.4 billion net assets acquired includes $3 billion of net working capital. Both cash and inventories were each just under $1 billion. The amount of inventory as of closing was written up as part of the purchase accounting to its fair value which Mark mentioned, and is based on the estimated selling prices for the products. As a result of this write up, we expect lower margins on sales of Elpida products in the first few months following the acquisition as we sell through the material that was subject to the write-up. Normal margins should return around the end of the first fiscal quarter. The amount of property, plant, and equipment consolidated -- for consolidated Elpida,…

Thanks, Ron. I will provide some more detail on our fourth quarter operating performance, as well as, share some thoughts on current market conditions. Our NAND Solutions Group recorded revenue of $781 million, up 7% when compared to our third quarter. Total NAND gross margins increased slightly in the quarter as we continue to improve our mix. Our NAND ASPs were down 9% quarter-over-quarter, partially driven by an increase in higher density, lower price per gigabyte SSD products and partially driven by early production capacity from our fab seven conversion, ending up in a transactional market such as memory cards and USB devices which generally produce a lower ASP. Our SSD business is growing significantly faster than the overall SSD market. Micron branded SSD revenue for the year was 76% over 2012. It's worth noting that over 50% of our trade NAND revenue goes to either Micron branded SSDs or our strategic customers who serve the SSD category with Micron's NAND technology. We continued to migrate our SSD product family to advanced lithography nodes. Our 20-nanometer flash memory technology represented 40% of our client SSD shipments and our 25-nanometer process represented over 80% of our enterprise shipments. Our newly announced M500 based on our 20-nanometer technology is seeing strong acceptance not only in client, but data center applications. We've also qualified two new enterprise drives at Tier-1 OEMs, our P410 flash drive and our P420 PCIe drive. On the technology front, Micron introduced its industry leading 16-nanometer MLC NAND, the most advanced processing node for any current product produced in the semiconductor device industry. For this accomplishment, Micron won the Best Technology Award, at the 2013 Flash Memory Summit held in August. We're pleased with the results from our NAND business and continue to look for ways to drive higher…

Thank you, Mark. What we'd like to do now is take questions from callers. (Operator instructions). Please open up the lines.

(Operator instructions). Our first question will come from the line of Glen Young with Citi. Please go ahead. Your line is now open. Adeline Lee – Citigroup: This is Adeline Lee for Glen Young. My first question is, can you tell us a little bit about your CapEx split and also CapEx loading?

This is Mark. We gave you already the CapEx spend projected for the year. In terms of how that's split technology wise, a little bit more than half on DRAM with the remainder to build out incremental 80 and 90 series NAND conversion which is 20 -- conversion to 20-nanometer and 16-nanometer as well as some early spend on 3D NAND. Adeline Lee – Citigroup: And then can you also sort of help us in terms of ASPs. After the Wuxi fire at Hynix, what do you think pricing will do before -- when they get back to their normal loading sometime in the first half of 2014? What do you think pricing will do?

This is Mark Adams. As we typically don't do, we’ll not comment on future pricing. There’s a lot of variables we just don't have a handle on in terms of what the competitive recovery would look like. Obviously, we are in a situation that since then up until quarter to-date, it's further tightened, was a tightening market, but we're not in a position of predicting future pricing.

Yeah, I think as well as that, I would just add that it's still a little unclear to us at least exactly when there will be a full recovery, so trying to get the dynamics around how that all plays out over time is very difficult.

Our next question in queue will come from the line of Monika Garg with Pacific Crest Securities. Please go ahead. Your line is now open. Monika Garg – Pacific Crest Securities: Your operating margins on DRAM segments are much higher than the NAND segment. And you're also guiding to ASP increase in DRAM and ASP decline in NAND. So the question is then why not delay the conversion of Singapore fab from DRAM to NAND for maybe a quarter or two quarters?

What I said, Monika is that we haven't changed our trajectory yet. And what we said in the past is we want to maintain a high degree of flexibility and be reactive to our customer needs and what's going on in the marketplace, so we can optimize margins. So, I'm not going to comment on what we might do going forward. We're going to continue to watch the market pretty carefully and do what we need to do for Micron and our customers. Monika Garg – Pacific Crest Securities: The next one is on the WSG segment. The revenues increased considerably of course due to Elpida's mobile DRAM business, but operating margins are still in the negative, right? So I'm just trying to understand the dynamics there. Is it that inventory because of that lower gross margin from Elpida assets? Could you just walk a little bit on that side please?

There is that. I think you're hitting on a couple of areas that are relevant, but also remember there’s a three months, basically a full quarter inventory flow through which will be much more positive when we get through that period as well.

There is also one month in there of Elpida in the reported results.

Let me take this chance also just to comment that in the mobile business, we are currently -- we are strategically looking at a margin business, not a scale business. And so where we see opportunities to use our capacity for specialized and differentiated product in mobile, that's what we're focused on. We're not trying to necessarily grow the top line in mobile just to grow it, and I think from our perspective, when you add all those factors together, you'll continue to see hopefully us make announcements around differentiated products.

Our next question in the phone queue will come from the line of Joe Moore with Morgan Stanley. Please go ahead. Your line is now open. Joseph Moore – Morgan Stanley: The 17% growth in NAND bits, you had talked about production up high single-digits early in the quarter. Was that from inventory or did you have upside from the production numbers that you thought you'd have?

Yes, Joe, you're correct. That was actually reported a production number. So, production numbers came in even better. I think Mark mentioned in his script that in particular we were pleased to see that the 20-nanometer NAND is now more than 50% of our bits produced. So we’re pretty pleased with how the team executed.

Looping back also, Joe to the tech conversion, again while we’re going to monitor that as the market continues to evolve, that transition went better than we ever could have possibly expected, that the yields are phenomenal there, and it’s been very, very smooth. Joseph Moore – Morgan Stanley: And then in terms of the tax rate that you talked about, at the analyst meeting you guys have talked about the disparity between kind of a cash tax rate and then the non-GAAP from the true up of the NOLs around fair value, are we going to be able to get visibility into what the difference is between those two tax rates going forward?

Joe, this is Ron. I showed you the effect in the latest reported quarter, and I gave you a projection for the first quarter, so we will continue to pro forma that each quarter and give you the breakdown. The fact is that it's easier for us to actually project the cash tax rate and it’s going to be in the low-single digit range over time, because of our tax structure and that’s what we'll actually be paying in taxes. The GAAP tax rate is more difficult to figure out because it's an estimated effective tax rate based upon your projected annual profits or pre-tax profits. So I can give you a pretty good diagnosis of cash tax rates, and in each quarter we'll break out the non-cash portion that's in our GAAP number.

Our next question in queue comes from the line of Doug Freedman with RBC Capital Markets. Please go ahead. Your line is now open. Doug Freedman – RBC Capital Markets: Congrats on all the execution of all the moving parts here. Is there any way you can help me get what the gross margins would have been if you had recorded Elpida product at manufacturing cost as opposed to the marked up?

Doug, if you look at my schedule on the pro forma, you should be able to pull that out because we’ve showed the step up amount of the inventory around $40 million for the fourth quarter, $41 million on the non-GAAP schedule that I provided when I made my prepared comments, so that's the difference. Doug Freedman – RBC Capital Markets: So it's not a significant number this quarter?

Pardon me? Doug Freedman – RBC Capital Markets: So it ends up – great. The $41 million, it's not going to move my gross margins multiple percentage points this quarter. Going forward though it will have a more material --

Going forward, I gave you the estimate, $110 million to $120 million in Q1. Doug Freedman – RBC Capital Markets: And then I just want to make sure I heard it correctly. You were talking Inotera bits, even post-acquisition integration, Inotera bits in DRAM are going to make up 60%. Did I hear that correctly?

No. In DRAM, Elpida bits make ups -- would be make up around 60% of our production in Q1 of DRAM production. Doug Freedman – RBC Capital Markets: How much is Inotera?

Well, it's a part of the remainder, the larger part of the remainder. Doug Freedman – RBC Capital Markets: Because those bits are at the cost plus accounting method?

Market minus.

The Inotera bits are market minus, and Elpida is part of our consolidated result. So, does that address your question? Doug Freedman – RBC Capital Markets: It does. Thank you.

Our next question in queue will come from the line of Steven Fox with Cross Research. Please go ahead. Your line is now open. Steven Fox – Cross Research: It seems like once again your business in the enterprise market is better than you would have thought of three months ago. Just curious if you could talk especially on the SSD side, you mentioned some of the product successes. As you look out into this quarter, where do you see that going? Then secondly, on the server side, I wonder if you can give some more color around where you're being successful on the DRAM sales because again it looked it was doing better than you would have thought three months ago. Thanks.

Steven Fox – Cross Research: Just a follow-up along that line. You mentioned [web scale] customers as being part of the driver. And I think you've also talked about the risks around the linearity of those customers. Is that something that played out in the quarter at all? Do you expect that to play out in calendar fourth quarter? How do you see that market evolving near-term?

So far until quarter-to-date, we think that it's been mildly capacity constrained with good capacity bits being able to serve that space. So we haven't seen any detriment to suggest otherwise. Again, I think we're getting some tailwinds on customer engagements in this business with our product portfolio that again we feel pretty positive and bullish going forward. Steven Fox – Cross Research: And then just wrapping all that, I was just curious, as you apply all that to margins, how do you feel in terms of products, whether it’s SSDs or selling in the server market where -- are your margins optimized at this point in either product line or would you say there is room to improve there? Thanks.

Yeah, again, we probably won't touch that one in terms of future margins and future ASPs.

Our next question in queue will come from the line of James Schneider with Goldman Sachs. Please go ahead. Your line is now open. James Schneider – Goldman Sachs: I was wondering if you could talk a little bit about the capacity plans at Elpida, Hiroshima fab and also Rexchip in terms of what shrinks you're going to do over the next couple of quarters with the CapEx and transitions both on the mobile and PC DRAM side.

This is Mark Durcan. At Elpida, we have a 25-nanometer ramp well underway and that's going quite smoothly. There has been some early activity at Rexchip as well, although that would go maybe at a more muted pace. And we'll continue to monitor how we have our computing and DRAM mix and that may get things more than technology introduction at Rexchip as we try and get that mix right. But generally speaking we have product running at both those fabs and the 25-nanometer node. 20-nanometer is really a second calendar half of 2014 story. There will be activity in the first half, but it will production in the second half of 2014. In NAND, as we said before, we're over 50% 20-nanometer NAND already and well into our 15-nanometer ramp which has gone very well. James Schneider – Goldman Sachs: I was wondering if you could maybe talk a little bit about understanding you want to keep your options open and keep things flexible regarding the tech transition to NAND. But sitting here looking at today, would you expect that transition to be complete from an output perspective by the end of the calendar first or second quarter?

I want to keep a little mystery in that dynamic.

Our next question in queue will come from the line of John Pitzer with Credit Suisse. Please go ahead. Your line is now open. John Pitzer – Credit Suisse: Just real quickly, on the ASP guidance for DRAM in the November quarter, curious much of that is being influenced by the addition of Elpida for three months in the quarter, i.e., if you just look at the core Micron and Inotera DRAM ASPs, any sense of how you can tell us how that would have trended Q-on-Q?

This is Ron. John, if you look at there are couple of effects, James. One is the --John, excuse me, the flow of market prices, which are up stronger than the average guidance we're giving. But the Elpida product mix has a lower average price than that of historical Micron. As I mentioned in my comments, this pushes down the average ASP in Q1 as you work that into the total mix for a full quarter. Everything else being equal, I would estimate that based on today's pricing that the Elpida mix is taking us down in our average in the high-single digit range. So the guidance we gave you is muted by the fact that the Elpida mix is dropping us down in the high-single digit range on average using quarter-to-date pricing and estimated mix. John Pitzer – Credit Suisse: That’s very helpful, Ron. Then either for Mark Durcan or Mark Adams. Guys, there’s been a lot made about the NAND transition from planar to 3D. I'm wondering if you could help me better understand the Moore's law issues on DRAM, especially as we get below the 20-nanometer node. Seeing a lot of white papers out there about whether or not we've got the right materials, what the cost curve is going to start to look like. So just generically as we think about the shrink capacity in DRAM, how does that look over the next several years?

Sorry. Is the question is relative to NAND or DRAM or a little of both? John Pitzer – Credit Suisse: No, to DRAM specifically. I think investors have vetted the 2D to 3D in NAND. I'm just curious about what's going on in DRAM from a technology perspective? And is there a chance here that the shrink growth slows here as we get below the 20 nanometer node?

Absolutely. I think it's inevitable that the pace of technology node migration is going to continue to slow. There's no -- it's interesting because it's not like NAND where there’s really a hard stop on planar NAND. It just becomes very, very difficult with a floating [detail] to make it work at all below about 50 nanometers. But DRAM has a lot of bags in the trick -- a lot of tricks in the bag, sorry. It's just an economic challenge to make that all play out. So I think you're going to continue to see technology migration, but maybe addressing smaller segments where there is some particular form factor need or performance need, as well as just a longer trajectory to get to the next node. But you will see nodes well below 20 nanometers over the next five to seven years.

Our next question in queue will come from the line of Vijay Rakesh with Sterne Agee. Please go ahead. Your line is now open. Vijay Rakesh – Sterne Agee: I'm just wondering, when you look at mobile, I know you gave out your expectations for DRAM, but when you look at mobile DRAM for next year, where do you think mobile DRAM grows? Also, on the NAND side, what's your split between SSD and OEM retail now?

Vijay, are you asking that from a Micron perspective or a market perspective? Vijay Rakesh – Sterne Agee: If you can give me both for mobile DRAM.

I’ll give you market. Like Mark, I don't want to -- I want to keep some mystery in exactly what we do with our mix. But basically what you're seeing per handset only, you're looking at an average megabytes per phone of about 450 going to just over 700 in 2014. On the NAND side we're looking at something just below an average of 5 gigabytes of phone going to something just over six and that includes all handsets, an average of all handsets in. Vijay Rakesh – Sterne Agee: And on the NAND side what's your split between SSD and OEM retail?

Again from a market segment standpoint? Vijay Rakesh – Sterne Agee: Yeah, from Micron standpoint.

I would say from a Micron standpoint, we're running around 50% of revenues from SSD and around 30% from consumer and around 10% mobile. Vijay Rakesh – Sterne Agee: Last question here. I know there’s a lot of focus on free cash flow. When you look at CapEx next year, I know it's coming down. Any thoughts on that? I know you've guided to $2.6 billion to $3.2 billion for fiscal '14, but you expect it to come down a little bit. Where do you think it comes in?

After that period, so you are looking at 2015? Vijay Rakesh – Sterne Agee: Yes.

I think we'll hold off on that one for now too.

Our next question in queue will come from David Wong with Wells Fargo. Your questions please. David Wong – Wells Fargo: One simple one. R&D, your guidance for the November quarter, $340 million to $350 million. Does this include -- is there some opportunity for rationalization of R&D going forward? Do you have duplication that you plan to eliminate so that the R&D will drop in future quarters?

David, it's Ron. Yeah. Obviously, we've just got the acquisition together and we're looking at our go-forward strategies for all of our operating structures and there certainly are opportunities. The general structure of OpEx, both for R&D and SG&A at Elpida was similar to ours as a percent of revenue. So it doesn't radically change the percents of where we are right now. Going forward, obviously we'll be looking at efficiencies and synergies that we can derive across the whole cost structure. David Wong – Wells Fargo: And just to push a bit further on that CapEx question. I understand you don't want to give guidance for the out year. But within that $2.6 billion to $3.2 billion, are there any special charges that you're taking or special costs that you’re incurring to integrate all your facilities? And can you quantify those for us that are one-term lead type things?

No. There’s really not. It's really just the technology migration across the entire network.

Unfortunately we only have time for about one more question.

Our next question in queue will come from the line of Daniel Amir with Lazard. Please go ahead, your questions please. Daniel Amir – Lazard Capital Markets: So just a quick question. Just in terms of DRAM mix, what's the consideration here in terms of changing the DRAM mix here over time now that you have Elpida. In terms of looking at increasing the networking or server DRAM versus mobile and PC, what's the considerations here? Thanks.

Some of that, Daniel is really qualifying and getting those products into these applications and internally qualifications as well as getting them qualified at the customer level. But the opportunity we believe is significant. We're obviously not going to quantify it here on this call, but you've heard reference today to historical revenue from Elpida around wafer sales and personal computing and mobile. They obviously haven't in the past been very successful in getting over there to these specialty markets. And quite frankly, our customers you can see we had records in basically all of our specialty markets and we feel like we were constrained. There was more upside there. So we think the opportunity is there. Our job is to go make that happen.

At the highest level, we're not seeking any market share segments in any particular segment. We’re seeking to optimize our margins across the segments and drive differentiated products that have enduring values.

With that, we would like to thank everyone for participating on the call today. If you will please bear with me, I need to repeat the Safe Harbor protection language. During the course of this call, we may have made forward-looking statements regarding the Company and the industry. These particular forward-looking statements and all other statements that may have been made on the call that are not historical facts are subject to a number of risks and uncertainties and actual results may differ materially. For information on the important factors that may cause actual results to differ materially, please refer to our filings with the SEC, including the Company's most recent 10-Q and 10-K. Thank you.

Thank you, sir. This concludes today's Micron Technology's fourth quarter and fiscal yearend 2013 financial release conference call. You may now all disconnect.