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Sanjay Mehrotra Puts Stamp On Micron

In his first three months, Micron's new chief executive has enlisted two former SanDisk executives with experience in enterprise memory to further the company's big data strategy.

As one of SanDisk's founders, Sanjay Mehrotra helped turn flash into a familiar sight from office supply stores to supermarkets. But now Micron's chief, Mehrotra is putting a stamp on his new company with executive hires and the closing of a business that sold flash drives to consumers.

The moves amount to an affirmation of Micron's plan to sell short-term memory and long-term storage for servers and automobiles in addition to its traditional markets for personal computers and phones. That echoes Mehrotra's strategy as chief executive in the last five years of SanDisk, which Western Digital acquired for around $19 billion in 2015.

At Micron, he appears to have started where he left off. On Monday, the company hired Jeff VerHeul, SanDisk's former vice president of corporate engineering, to run the non-volatile memory business. Last week, it also hired Sumit Sawada, the former chief strategy officer of SanDisk's enterprise solutions, to be chief business officer.

Also on Monday, Micron announced that it would sell at least part of its removable memory unit, which sells memory cards, USB flash drives, readers, and storage devices for consumers. Jay Hawkins, Micron's consumer products group president, said that the Lexar business no longer jived with Micron's strategy.

"The decision was made as part of the company's ongoing efforts to focus on its increasing opportunities in higher value markets," Hawkins wrote in a blog post.

As Micron's center of gravity has shifted, the business has thrived on higher DRAM prices, growing NAND sales, and the falling cost of manufacturing its chips, whose prices typically change based on supply and demand. On Thursday, the Boise, Idaho-based company reported third quarter revenue of $5.57 billion, up 92% from the same time last year.

"The unprecedented amount of data being created, stored, and processed presents tremendous opportunities for Micron," Mehrotra said in a conference call with investors. "Applications like autonomous driving, machine learning, and big data analytics all promise to make an enormous impact on our lives."

Mehrotra said that success in these markets would protect Micron against sudden market shifts, which have tortured the supplier for years. Micron competes with Samsung and SK Hynix in DRAM chips, while battling those companies as well as Toshiba and Western Digital in NAND flash.

Now, it is eyeing larger sales in automotive infotainment, factory equipment, and servers. Micron's cloud business, which has grown four times in the last year, is targeting NAND controllers and firmware in an attempt to lure customers. This year, the company is also ramping 3D NAND with 64 layers using unique CMOS under array technology to reduce die size.

Part of Micron's strategy is to sell server chips based on the secretive 3D XPoint memory that it built with Intel. But in February, Micron said that it would see little revenue this year from the unique non-volatile memory, which has better capacity than DRAM and lower latency than NAND.

That implies that Micron's first products based on 3D XPoint will not appear until late this year. Meanwhile, Intel is already selling the technology inside Optane solid-state drives, which slip into motherboard slots. Some industry analysts believe that Intel's chips will start out in servers as cache, not main memory.

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