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THE SELL OFF TODAY, ADDING TO A SOLID START TO THE YEAR AFTER A STRONG 2025. THE COMPANY NAVIGATING A TIGHT MEMORY MARKET AND BREAKING GROUND ON A MASSIVE SEMICONDUCTOR MANUFACTURING PLANT IN UPSTATE NEW YORK. LAST WEEK MICRON CEO SANJAY MEHROTRA JOINS US NOW FIRST ON CNBC. IT'S GOOD TO SEE YOU AGAIN. WELCOME.
CLEARLY, THERE'S SO MUCH EXCITEMENT AROUND YOUR STOCK AND YOUR BUSINESS BECAUSE OF THE SHORTAGE IN THE MEMORY MARKET. HOW EXTREME IS THAT RIGHT NOW.
>> SO FIRST OF ALL GOOD TO BE BACK HERE SEEING YOU IN DAVOS. ALWAYS GREAT. AND LET ME JUST POINT OUT THAT IT'S NOT JUST ABOUT THE SHORTAGE OF MEMORY. IT IS ALSO ABOUT THE VALUE OF MEMORY. YOU KNOW AI IS NOW EVERYWHERE FROM DATA CENTER TO THE EDGE. MEMORY IS A KEY ENABLER OF AI. IT IS A STRATEGIC ASSET TODAY. NOT LIKE JUST A COMPONENT IN THE SYSTEM.
>> AND SO WE NEED IT.
>> WE NEED IT JUST LIKE YOUR BRAIN. YOU NEED MORE MEMORY. YOU NEED FASTER MEMORY. THAT'S WHAT IS EXACTLY HAPPENING IN AI ACCELERATORS. AS LARGE LANGUAGE MODELS EVOLVE AS TRAINING AND THEN INFERENCE GO ACROSS THE EDGE, YOU KNOW, AND CONTINUE TO BROADEN, THEY ALL NEED MORE MEMORY. AND THAT'S WHAT IS CREATING, YOU KNOW, TREMENDOUS DEMAND FOR MEMORY. AND THIS IS A LONG TERM TREND OF AI GROWTH. WE ARE A REAL BELIEVER IN AI. AND SUPPLY CERTAINLY HAS BEEN TIGHT.
>> AND SUPPLY IS THAT SHORTAGE.
>> YOU KNOW, I WILL TELL YOU, I SHARED IN OUR DECEMBER EARNINGS CALL THAT FOR SEVERAL OF OUR KEY CUSTOMERS IN THE MEDIUM TERM, WE ARE ABLE TO SUPPORT 50% TO TWO THIRDS OF THEIR DEMAND. AND THAT'S WHY WE ARE REALLY FOCUSED ON BRINGING UP SUPPLY IN THE NEAR TERM, FOCUSED ON ACCELERATING IN OUR MANUFACTURING INFRASTRUCTURE. TECHNOLOGY TRANSITIONS TO THE NEXT NODE THAT GIVES YOU SUPPLY GROWTH CAPABILITY. AND, YOU KNOW, FOR THE LONGER TERM, CERTAINLY VERY MUCH FOCUSED, AS YOU KNOW, AND AS YOU JUST MENTIONED, IN NEW YORK BREAKING GROUND ON GREENFIELD FAB IN IDAHO, ALREADY HAVING FAB UNDER CONSTRUCTION, THE FIRST FAB WILL BRING FIRST WAFERS OUT IN MIDDLE OF 27 TIME FRAME WITH VOLUME RAMPING IN THAT FIRST FAB IN IDAHO IN 28. WE ALREADY HAVE SECOND FAB IN IDAHO IN DESIGN PHASE. THAT WILL BE MEANINGFUL VOLUME RAMP HAPPENING IN 2029. TIME FRAME. WHAT ABOUT NEW YORK THE NEW YORK YOU KNOW THESE FABS I MEAN THEY ARE MASSIVE FABS. EACH OF THEM ARE SIZE OF TEN FOOTBALL FIELDS MASSIVE AMOUNT OF CONSTRUCTION INVOLVED. SO THAT'S STARTING CONSTRUCTION. WE PLAN TO POUR CONCRETE LATER THIS YEAR. THAT FAB WILL BE READY FOR COMMISSIONING IN 2028. TIMEFRAME MEANINGFUL PRODUCTION RAMP IN 2030. IT JUST AND THAT'S WHAT IS CAUSING TREMENDOUS SUPPLY SHORTAGE. AND THAT'S WHAT REALLY NEEDS TO BE REALIZED. THAT VALUE OF MEMORY IS HIGHER THAN EVER, AND CONSTRUCTION TAKES A LONG TIME. NEW CAPACITY, NEW GREENFIELD FABS ARE NEEDED TO REALLY ADDRESS THIS DEMAND, AND THAT WILL OCCUR OVER TIME. AND THERE'S A LONG LEAD TIME FOR CONSTRUCTION.
>> I THINK THAT'S WHY YOUR STOCK IS IS BUCKING THE TREND AND HAS BEEN SUCH AN OUTPERFORMER. WHAT DOES IT MEAN FOR PRICES WHICH HAVE OBVIOUSLY RISEN? YOUR MARGINS ARE ALREADY AT A RECORD HIGH. I MEAN, ARE WE GOING TO CONTINUE TO SEE WHAT, 10% PRICE INCREASES PER QUARTER OR SO?
>> SO WE DON'T COMMENT ON THE SPECIFICS OF PRICES. BUT OF COURSE, PRICING IS A FUNCTION OF THE VALUE THAT THE MEMORY BRINGS. AND AS I MENTIONED EARLIER, MEMORY IS NOW A CRITICAL ENABLER. IT'S ESSENTIAL FOR ALL AI, NOT JUST IN DATA CENTER, BUT IN YOUR SMARTPHONES, IN YOUR PCS. AI ENABLED DEVICES NEED MORE MEMORY CONTENT. AND LOOK AHEAD. LOOK AT THE FUTURE. YOU WILL HAVE SELF-DRIVING CARS MORE AND MORE OF THEM, AND YOU'RE GOING TO HAVE HUMANOIDS. AS YOU START APPROACHING TURN OF THE DECADE INTO THE NEXT DECADE, ALL OF THOSE NEED MORE MEMORY. SO THIS TREND HERE IS LONG TERM. AND, YOU KNOW, OF COURSE, WE ARE VERY MUCH FOCUSED ON CONTINUING TO REALLY POSITION MICRON WITH THE BEST TECHNOLOGY, WITH THE BEST PRODUCT, WITH THE BEST MANUFACTURING CAPABILITIES, AND BEING CLOSE TO OUR CUSTOMERS AND ADDRESS THEIR NEEDS.
>> WHEN IT COMES TO AMERICAN MANUFACTURING, DO YOU THINK WE CAN WE CAN REALLY BE COMPETITIVE.
>> ABSOLUTELY. WE ARE VERY APPRECIATIVE OF THE TREMENDOUS SUPPORT THAT WE HAVE RECEIVED FROM THE TRUMP ADMINISTRATION. IN JUNE, WE ANNOUNCED THAT WE WILL BE INVESTING $200 BILLION HERE IN THE US FOR SEMICONDUCTOR MANUFACTURING AND R&D AND WITH GOVERNMENT SUPPORT, AND, OF COURSE, CONTINUE TO FOCUS ON BRINGING LEADING EDGE MEMORY TECHNOLOGY MANUFACTURING HERE TO THE US. WE ABSOLUTELY PLAN TO MAKE SEMICONDUCTOR MANUFACTURING SUCCESSFUL IN THE US. I THINK YOU SHOULD LOOK AT MICRON AS A US NATIONAL SEMICONDUCTOR CHAMPION. JUST KEEP IN MIND WITH THIS $200 BILLION INVESTMENT, OF COURSE, WE'LL BE CREATING TENS OF THOUSANDS OF JOBS. THE FIRST TWO FABS IN NEW YORK WILL ADD 50,000 JOBS IN CENTRAL NEW YORK. AND A LOT OF THEM, MOST OF THEM ACTUALLY EVEN IN CONSTRUCTION, 80, 85% TO BE SOURCED LOCALLY. BUT ALMOST ALL THE JOBS.
>> I WAS GOING TO ASK YOU ABOUT THAT I WAS GOING TO BECAUSE YOU NEED THOUSANDS OF SKILLED WORKERS TO BUILD THESE PLANTS. AND DO WE HAVE THAT IN AMERICA?
>> SO WE ARE ABSOLUTELY WORKING ON THE PIPELINE FOR WORKERS. WHEN YOU LOOK AT, YOU KNOW, WE ARE ENGAGING WITH NORTHEAST UNIVERSITY ECOSYSTEM TO ADVANCE SEMICONDUCTOR CURRICULUM. WE ARE ALSO WORKING WITH COLLEGES, JUNIOR COLLEGES SUCH AS ONONDAGA COMMUNITY COLLEGE, WHERE WE HAVE SET UP A CLEAN ROOM TO TRAIN THE WORKERS THERE FOR THE FUTURE. SO WE ARE ABSOLUTELY INVESTING IN PREPARING FOR THE FUTURE WORKFORCE. NEW YORK AREA GRADUATES ABOUT 20,000 STEM GRADUATES EVERY YEAR, AND THE NEW YORK STATE HAS A PROGRAM WITH RESPECT TO TRAINING OF CONSTRUCTION WORKERS AND PREPARING THE WORKFORCE FOR SEMICONDUCTOR MANUFACTURING. THERE ARE ABOUT 2000 TALENT PIPELINE IN CRAFTS FOR THAT ARE NEEDED FOR MANUFACTURING CONSTRUCTION RELATED WORK EVERY YEAR IN IN THAT REGION IN NEW YORK AS WELL. AND THAT'S WHY WE FEEL CONFIDENT THAT WE WILL BE ABLE TO BUILD THAT WORKFORCE. JUST KEEP IN MIND MICRON OVER THE YEARS HAS BEEN IN IDAHO AND WE ARE BUILDING A MANUFACTURING FAB THERE, AND WE HAVE STRONG EXPERIENCE THERE ALREADY.
>> WHAT ABOUT CHINA? I JUST HAVE TO ASK YOU ABOUT THAT BECAUSE YOU STILL SELL TO CHINA. THERE HAVE BEEN RESTRICTIONS ON WHAT YOU CAN AND THAT HAS SHRUNK THE BUSINESS AS WELL. BUT HOW BIG OF A GEOPOLITICAL RISK DO YOU SEE THERE FOR FOR YOUR BUSINESS?
>> YOU KNOW, WHAT I WOULD TELL YOU IS THAT CHINA USED TO BE LIKE IT IS FOR SEMICONDUCTOR INDUSTRY, YOU KNOW, HIGH 20S AS A PERCENTAGE OF OUR REVENUE, WITH THE DEMAND BEING DRIVEN BY AI ACROSS THE BOARD ON A GLOBAL BASIS. OF COURSE, WE ARE VERY MUCH ENGAGED WITH ALL THE GLOBAL LEADERS DRIVING INNOVATION, AND SOME OF THEM ARE IN CHINA AS WELL. CHINA TODAY IS IN LOW DOUBLE DIGIT PERCENTAGE OF OUR REVENUE. WE ARE VERY MUCH FOCUSED ON BRINGING AI MEMORY AND MEMORY ACROSS THE BOARD. AND MICRON TODAY IS A CLEAR TECHNOLOGY LEADER. FOURTH, SUCCESSIVE GENERATION OF DRAM TECHNOLOGY LEADERSHIP ON A GLOBAL BASIS. THIRD, SUCCESSIVE GENERATION OF NAND TECHNOLOGY LEADERSHIP ON A GLOBAL BASIS. THAT'S WHAT WE ARE FOCUSED ON CONTINUING DRIVING TECHNOLOGY LEADERSHIP, PRODUCT PORTFOL