What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-10-04 compared with 2023-10-06 · 250 added, 319 removed, 826 unchanged (41% of the section changed)

12 unchanged sentences

For the year ended August 29,

2023 September 1,

2024 August 31,

2023 September 1,

26 unchanged sentences

For the year ended August 29,

2023 September 1,

2024 August 31,

2023 September 1,

2 unchanged sentences

Gains (losses) on derivative instruments 142 234 ( 516 )

Pension liability adjustments 11 3 3

Unrealized gains (losses) on investments 33 6 ( 48 )

6 ( 48 ) ( 7 )

Pension liability adjustments 3 11 3

Foreign currency translation adjustments — ( 3 ) ( 1 )

6 unchanged sentences

As of August 29,

2023 September 1,

2024 August 31,

Cash and equivalents $ 7,041 $ 8,577

24 unchanged sentences

Shareholders’ equity

Common stock, $ 0.10 par value, 3,000 shares authorized, 1,239 shares issued and 1,098 outstanding ( 1,226 shares issued and 1,094 outstanding as of September 1, 2022)

Common stock, $ 0.10 par value, 3,000 shares authorized, 1,253 shares issued and 1,109 outstanding ( 1,239 shares issued and 1,098 outstanding as of August 31, 2023)

Additional capital 12,115 11,036

Retained earnings 40,877 40,824

Treasury stock, 141 shares held ( 132 shares as of September 1, 2022)

Treasury stock, 144 shares held ( 141 shares as of August 31, 2023)

( 7,852 ) ( 7,552 )

13 unchanged sentences

Other comprehensive income (loss), net — — — — — ( 562 ) ( 562 )

Stock issued under stock plans 13 2 223 — — — 225

Stock issued under equity compensation plans

12 1 244 — — — 245

Stock-based compensation expense — — 514 — — — 514

1 unchanged sentence

Repurchase of stock - withholdings on employee equity awards ( 2 ) — ( 14 ) ( 112 ) — — ( 126 )

Stock issued for convertible notes 11 1 ( 1 ) — — — —

Cash settlement of convertible notes — — ( 52 ) — — — ( 52 )

Dividends and dividend equivalents declared ($ 0.315 per share)

3 unchanged sentences

Other comprehensive income (loss), net — — — — — 248 248

Stock issued under stock plans 12 1 244 — — — 245

Stock issued under equity compensation plans

15 1 262 — — — 263

Stock-based compensation expense — — 596 — — — 596

3 unchanged sentences

— — — ( 509 ) — — ( 509 )

Balance at September 1, 2022 1,226 $ 123 $ 10,197 $ 47,274 $ ( 7,127 ) $ ( 560 ) $ 49,907

Balance at August 31, 2023 1,239 $ 124 $ 11,036 $ 40,824 $ ( 7,552 ) $ ( 312 ) $ 44,120

Net income (loss) — — — 778 — — 778

Other comprehensive income (loss), net — — — — — 178 178

Stock issued under stock plans 15 1 262 — — — 263

Stock issued under equity compensation plans

17 1 271 — — — 272

Stock-based compensation expense — — 833 — — — 833

9 unchanged sentences

For the year ended August 29,

2023 September 1,

2024 August 31,

2023 September 1,

3 unchanged sentences

Depreciation expense and amortization of intangible assets 7,780 7,756 7,116

Provision to write down inventories to net realizable value 1,831 — —

Stock-based compensation 833 596 514

Provision to write down inventories to net realizable value — 1,831 —

Goodwill impairment

Restructure and asset impairments 11 44 454

Loss on debt repurchases and conversions

Change in operating assets and liabilities:

2 unchanged sentences

Accounts payable and accrued expenses 1,915 ( 1,302 ) 334

Other current liabilities

989 ( 817 ) 400

Other 281 19 119

3 unchanged sentences

Purchases of available-for-sale securities ( 1,999 ) ( 723 ) ( 1,770 )

Proceeds from maturities of available-for-sale securities 1,566 1,321 1,250

Proceeds from maturities and sales of available-for-sale securities

1,794 1,591 1,615

Proceeds from government incentives 315 710 115

Proceeds from sales of available-for-sale securities 25 294 856

Proceeds from sale of Lehi, Utah fab — — 888

2 unchanged sentences

Cash flows from financing activities

Proceeds from issuance of debt 6,716 2,000 1,188

Repayments of debt ( 1,897 ) ( 761 ) ( 2,032 )

2 unchanged sentences

Payments on equipment purchase contracts ( 149 ) ( 138 ) ( 141 )

Proceeds from issuance of debt 999 6,716 2,000

Other 18 95 86

17 unchanged sentences

With a relentless focus on our customers, technology leadership, and manufacturing and operational excellence, Micron delivers a rich portfolio of high-performance DRAM, NAND, and NOR memory and storage products through our Micron® and Crucial® brands.

Every day, the innovations that our people create fuel the data economy, enabling advances in artificial intelligence and 5G applications that unleash opportunities — from the data center to the intelligent edge and across the client and mobile user experience.

Every day, the innovations that our people create fuel the data economy, enabling advances in artificial intelligence (AI) and compute-intensive applications that unleash opportunities — from the data center to the intelligent edge and across the client and mobile user experience.

The accompanying consolidated financial statements include the accounts of Micron Technology, Inc.

2 unchanged sentences

Certain reclassifications have been made to prior period amounts to conform to current period presentation.

See “Inventories” below for changes to our significant accounting policies, and the “Inventories” note for additional information.

Our fiscal year is the 52 or 53-week period ending on the Thursday closest to August 31.

3 unchanged sentences

We use derivative instruments to manage our exposure to changes in currency exchange rates from (1) our monetary assets and liabilities denominated in currencies other than the U.S.

dollar and (2) forecasted cash flows for certain capital expenditures and manufacturing costs.

dollar, (2) non-U.S.-dollar-denominated investments in debt instruments, and (3) forecasted cash flows for certain capital expenditures and manufacturing costs.

We also use derivative instruments to manage our exposure to changes in commodity prices for manufacturing supplies and to minimize certain exposures to changes in the fair value of fixed-rate debt that result from fluctuations in benchmark interest rates.

3 unchanged sentences

For derivative instruments designated as cash flow hedges, gains or losses are included as a component of accumulated other comprehensive income and reclassified into earnings in the same line items and in the same periods in which the underlying transactions affect earnings.

For derivative instruments designated as cash flow hedges, time value is excluded from the assessment of effectiveness and the gains and losses attributable to time value are recognized in earnings through an amortization approach.

For derivative instruments designated as fair value hedges, changes in the fair values of the derivative instruments and the offsetting changes in the fair values of the underlying hedged items are both recognized in earnings.

For foreign currency and commodity derivative instruments designated as cash flow hedges or fair value hedges, time value is excluded from the assessment of effectiveness and the gains and losses attributable to time value are recognized in earnings through an amortization approach.

Cash flows from derivative instruments designated as cash flow hedges or fair value hedges are classified in the same category as the items being hedged.

3 unchanged sentences

Financial Instruments

Cash equivalents include highly liquid short-term investments with original maturities to us of three months or less that are readily convertible to known amounts of cash.

Cash equivalents include highly liquid short-term investments with original maturities at the time of purchase of three months or less that are readily convertible to known amounts of cash.

Other investments with remaining maturities of less than one year are included in short-term investments.

9 unchanged sentences

as a reduction of asset costs or a reduction of expenses.

Incentives related to the acquisition or construction of fixed assets are recognized as a reduction in the carrying amounts of the related assets and reduce depreciation expense over the useful lives of the assets.

Incentives related to the acquisition or construction of fixed assets are recognized as a reduction in the carrying amounts of the related assets and as a reduction to depreciation expense over the useful lives of the assets.

Incentives related to specific operating activities are offset against the related expense in the period the expense is incurred.

Government incentives received prior to being earned are recognized in current or noncurrent deferred income or restricted cash, whereas government incentives earned prior to being received are recognized in current or noncurrent receivables.

Government incentives received prior to being earned are recognized in current or noncurrent deferred income, whereas government incentives earned prior to being received are recognized in current or noncurrent receivables.

Cash received from government incentives related to operating expenses is included as an operating activity in the statement of cash flows, whereas cash received from incentives related to the acquisition of property, plant, and equipment is included as an investing activity.

Effective as of the beginning of the second quarter of 2021, we changed the method of inventory costing from average cost to FIFO.

The difference between average cost and FIFO was not material to any previously reported financial statements.

Therefore, we have recognized the cumulative effect of the change as a reduction of inventories and a charge to cost of goods sold of $ 133 million as of the beginning of the second quarter of 2021.

Inventories are stated at the lower of cost or net realizable value, with cost being determined on a FIFO basis.

10 unchanged sentences

Product and Process Technology

Costs incurred to (1) acquire product and process technology, (2) patent technology, and (3) maintain patent technology, are capitalized and amortized on a straight-line basis over periods ranging up to 12.5 years.

Costs incurred to (1) acquire product and process technology, (2) patent technology, and (3) keep patents in force, are capitalized and amortized on a straight-line basis over periods ranging up to 12.5 years.

We capitalize a portion of costs incurred to patent technology based on historical data of patents issued as a percent of patents we file.

11 unchanged sentences

We capitalize interest on borrowings during the period of time we carry out the activities necessary to bring assets to the condition of their intended use and location.

We utilize a weighted average capitalization rate that is based on our consolidated debt portfolio.

Capitalized interest becomes part of the cost of assets.

3 unchanged sentences

Subsequent to product qualification, product costs are included in cost of goods sold.

Amounts from cost-sharing arrangements are reflected as a reduction of R&D expense.

Revenue Recognition

18 unchanged sentences

Actual results could differ from estimates.

Lehi, Utah Fab and 3D XPoint

In 2021, we updated our portfolio strategy to further strengthen our focus on memory and storage innovations for the data center market.

In connection therewith, we determined that there was insufficient market validation to justify the ongoing investments required to commercialize 3D XPoint at scale.

Accordingly, we ceased development of 3D XPoint technology and engaged in discussions for the sale of our facility located in Lehi, Utah that was dedicated to 3D XPoint production.

As a result, we classified the property, plant, and equipment as held for sale in 2021, ceased depreciating the assets, and recognized a $ 435 million restructure and asset impairment charge and a $ 104 million tax benefit.

We closed the sale of our Lehi facility to TI in 2022 for $ 893 million and disposed of $ 918 million of net assets, consisting primarily of property, plant, and equipment, resulting in a $ 23 million loss, net of selling expenses and other adjustments.

Recently Issued Accounting Standards

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07 (ASC Topic 280), Improvements to Reportable Segment Disclosures .

This ASU expands on existing reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.

This ASU is effective for our annual reporting for 2025 on a retrospective basis.

This standard will impact our disclosures and will not impact our financial statements.

In December 2023, the FASB issued ASU 2023-09 (ASC Topic 740), Improvements to Income Tax Disclosures .

This ASU requires disaggregated income tax disclosures on the rate reconciliation and income taxes paid.

This ASU will be effective for our annual reporting for 2026 on a prospective basis, with retrospective application permitted.

This standard will impact our disclosures and will not impact our financial statements.

Variable Interest Entities

4 unchanged sentences

We have determined that we do not have the power to direct the activities of the Lease SPEs that most significantly impact their economic performance and we do not consolidate the Lease SPEs.

As of August 29, 2024, we had approximately $ 680 million of financial lease liabilities and right-of-use assets under these arrangements.

67 | 2024 10-K

2 unchanged sentences

Cash and equivalents and the fair values of our available-for-sale investments, which approximated amortized costs, were as follows:

As of August 31, 2023 As of September 1, 2022

As of August 29, 2024 As of August 31, 2023

Cash and Equivalents Short-term Investments Long-term Marketable Investments (1)

6 unchanged sentences

Asset-backed securities — 46 433 479 — 15 387 402

Government securities 5 131 20 156 2 155 44 201

Commercial paper

16 160 — 176 — 109 — 109

Government securities

35 82 42 159 5 131 20 156

7,041 $ 1,065 $ 1,046 $ 9,152 8,577 $ 1,017 $ 844 $ 10,438

Restricted cash (4)

4 unchanged sentences

We perform supplemental analysis to validate information obtained from these pricing services.

No adjustments were made to the fair values indicated by such pricing information as of August 31, 2023 or September 1, 2022.

No adjustments were made to the fair values indicated by such pricing information as of August 29, 2024 or August 31, 2023.

(4) Restricted cash is included in other current assets and other noncurrent assets and primarily relates to certain government incentives received prior to being earned and for which restrictions lapse upon achieving certain performance conditions or which will be returned if performance conditions are not met.

1 unchanged sentence

Non-marketable Equity Investments

In addition to the amounts included in the table above, we had $ 218 million and $ 222 million of non-marketable equity investments without a readily determinable fair value that were included in other noncurrent assets as of August 31, 2023 and September 1, 2022, respectively.

For non-marketable investments, we recognized in other non-operating income (expense) a net loss of $ 7 million for 2023 and net gains of $ 36 million for 2022 and $ 70 million for 2021.

In addition to the amounts included in the table above, we had $ 190 million and $ 218 million of non-marketable equity investments without a readily determinable fair value that were included in other noncurrent assets as of August 29, 2024 and August 31, 2023, respectively.

For non-marketable investments, we recognized in other non-operating income (expense) a net loss of $ 32 million for 2024 and $ 7 million for 2023 and a net gain of $ 36 million for 2022.

Our non-marketable equity investments are recorded at fair value on a non-recurring basis and classified as Level 3.

As of August 29,

2023 September 1,

2024 August 31,

Trade receivables $ 5,419 $ 2,048

Government incentives

Income and other taxes 268 194

Other 201 114

$ 6,615 $ 2,443

As of August 29,

2023 September 1,

2024 August 31,

Finished goods $ 1,308 $ 1,616

3 unchanged sentences

In 2023, we recorded charges of $ 1.83 billion to cost of goods sold to write down the carrying value of work in process and finished goods inventories to their estimated net realizable value.

Effective as of the beginning of the second quarter of 2021, we changed our method of inventory costing from average cost to FIFO.

This change in accounting principle is preferable because in an environment with continuously changing production costs FIFO more closely matches the actual cost of goods sold with the revenues from sales of those specific units, better represents the actual cost of inventories remaining on hand at any period-end, and improves comparability with our semiconductor industry peers.

The change to FIFO was not material to any prior periods, nor was the cumulative effect of $ 133 million material to the second quarter of 2021.

As such, prior periods were not retrospectively adjusted, and the cumulative effect was reported as an increase to cost of goods sold for the second quarter of 2021 of $ 133 million, with an offsetting reduction to beginning inventories.

This charge resulted in a corresponding reduction to operating income (loss), a $ 128 million reduction to net income (loss), and an $ 0.11 reduction to diluted earnings per share for both the second quarter and the year ended 2021.

Property, Plant, and Equipment

As of August 29,

2023 September 1,

2024 August 31,

Land $ 284 $ 283

7 unchanged sentences

$ 39,749 $ 37,928

(1) Includes costs related to equipment not placed into service of $ 2.91 billion as of August 31, 2023 and $ 3.35 billion as of September 1, 2022.

(2) Includes building-related construction, tool installation, and software costs for assets not placed into service.

(1) Includes costs related to equipment not placed into service of $ 3.10 billion as of August 29, 2024 and $ 2.91 billion as of August 31, 2023.

(2) Primarily includes building-related construction and tool installation.

Depreciation expense was $ 7.70 billion, $ 7.67 billion, and $ 7.03 billion for 2024, 2023, and 2022, respectively.

1 unchanged sentence

69 | 2024 10-K

Intangible Assets

As of August 31, 2023 As of September 1, 2022

Amount Accumulated

Amortization Net Carrying Amount Gross

Amount Accumulated

Amortization Net Carrying Amount

Product and process technology $ 613 $ ( 209 ) $ 404 $ 742 $ ( 321 ) $ 421

In 2023, 2022, and 2021, we capitalized $ 87 million, $ 158 million, and $ 106 million, respectively, for product and process technology with weighted-average useful lives of 9 years.

Amortization expense was $ 86 million, $ 85 million, and $ 82 million for 2023, 2022, and 2021, respectively.

Expected amortization expense is $ 75 million for 2024, $ 51 million for 2025, $ 47 million for 2026, $ 43 million for 2027, and $ 42 million for 2028.

As of August 31,

2023 September 1,

Goodwill $ 1,150 $ 1,228

In the fourth quarter of 2023, we recognized a charge of $ 101 million included in other operating income (loss) to impair all of the goodwill assigned to our SBU reporting unit based on a quantitative assessment for impairment.

We evaluated the fair value of our reporting units for the assessment based on an income approach, which uses a discounted cash flow methodology.

The impairment of SBU goodwill reflects lower forecasted cash flows for SBU as a result of adverse conditions in the storage industry environment due to weak demand in many end markets combined with global and macroeconomic challenges and lower demand resulting from customer actions to reduce elevated inventory levels.

These conditions led to significant reductions in SBU’s average selling prices and bit shipments, driving declines in revenue and cash flows.

The quantitative assessment for impairment indicated that the fair value for all of our other reporting units substantially exceeded their carrying value.

As of August 31, 2023, CNBU, MBU, and EBU had goodwill of $ 855 million, $ 198 million, and $ 97 million, respectively.

As of September 1, 2022, CNBU, MBU, SBU, and EBU had goodwill of $ 832 million, $ 198 million, $ 101 million, and $ 97 million, respectively.

The Company added $ 23 million of goodwill to CNBU from an acquisition in the third quarter of 2023.

We have finance and operating leases through which we obtain the right to use facilities, land, and equipment that support our business operations.

27 unchanged sentences

As of August 29,

2023 September 1,

2024 August 31,

Finance lease right-of-use assets (included in property, plant, and equipment)

10 unchanged sentences

As of August 29, 2024, maturities of lease liabilities by fiscal year were as follows:

For the year ending Finance Leases Operating Leases

Finance Leases Operating Leases

2025 $ 400 $ 93

2 unchanged sentences

( 308 ) ( 137 )

69 | 2023 10-K

$ 2,054 $ 681

The table above excludes obligations for leases that have been executed but have not yet commenced.

1 unchanged sentence

We will recognize right-of-use assets and associated lease liabilities at the time such assets become available for our use.

Intangible Assets

As of August 29, 2024 As of August 31, 2023

Amount Accumulated

Amortization Net Carrying Amount Gross

Amount Accumulated

Amortization Net Carrying Amount

Product and process technology $ 683 $ ( 278 ) $ 405 $ 613 $ ( 209 ) $ 404

11 — 11 — — —

$ 694 $ ( 278 ) $ 416 $ 613 $ ( 209 ) $ 404

In 2024, 2023, and 2022, we capitalized $ 84 million, $ 87 million, and $ 158 million, respectively, for product and process technology with weighted-average useful lives of 10 years, 9 years, and 9 years, respectively.

Amortization expense was $ 82 million, $ 86 million, and $ 85 million for 2024, 2023, and 2022, respectively.

Expected amortization expense is $ 67 million for 2025, $ 56 million for 2026, $ 52 million for 2027, $ 49 million for 2028, and $ 42 million for 2029.

71 | 2024 10-K

Accounts Payable and Accrued Expenses

As of August 29,

2023 September 1,

2024 August 31,

Accounts payable $ 2,726 $ 1,725

4 unchanged sentences

$ 7,299 $ 3,958

As of August 31, 2023 As of September 1, 2022

As of August 29, 2024 As of August 31, 2023

Net Carrying Amount Net Carrying Amount

2 unchanged sentences

2027 Term Loan A 6.944 % 7.08 % 1,065 57 1,006 1,063 1,123 57 1,063 1,120

2026 Term Loan A 6.806 % 6.94 % 971 49 921 970 — — — —

2027 Term Loan A 6.931 % 7.07 % 1,123 57 1,063 1,120 — — — —

4.975 % 5.07 % 500 — 499 499 500 — 499 499

5 unchanged sentences

4.663 % 4.73 % 850 — 847 847 850 — 846 846

5.300 % 5.41 % 1,000 — 994 994 — — — —

2032 Green Bonds 2.703 % 2.77 % 1,000 — 996 996 1,000 — 995 995

3 unchanged sentences

2051 Notes 3.477 % 3.52 % 500 — 496 496 500 — 496 496

2024 Term Loan A N/A N/A — — — — 588 — 587 587

2025 Term Loan A N/A N/A — — — — 1,052 — 1,050 1,050

Finance lease obligations

11 unchanged sentences

Transaction Date Increase (Decrease) in Principal Increase (Decrease) in Carrying Value Increase (Decrease) in Cash

2029 B Notes October 31, 2022 $ 750 $ 744 $ 744

2025 Term Loan A November 3, 2022 927 925 925

2026 Term Loan A November 3, 2022 746 745 745

2027 Term Loan A November 3, 2022 927 924 924

2025 Term Loan A January 5, 2023 125 125 125

2031 Notes January 12, 2024 $ 1,000 $ 993 $ 993

2024 Term Loan A January 12, 2024 ( 588 ) ( 587 ) ( 588 )

2025 Term Loan A January 12, 2024 ( 402 ) ( 401 ) ( 402 )

2029 B Notes February 9, 2023 500 520 520

2033 A Notes February 9, 2023 750 745 745

2028 Notes April 11, 2023 600 596 596

2033 B Notes April 11, 2023 900 890 890

2024 Term Loan A April 13, 2023 ( 600 ) ( 600 ) ( 600 )

2025 Term Loan A May 29, 2024

( 650 ) ( 649 ) ( 650 )

$ ( 640 ) $ ( 644 ) $ ( 647 )

In 2023, we issued $ 6.70 billion of senior unsecured notes and term loan agreements and received cash of $ 6.69 billion.

We prepaid $ 600 million of principal amount of the 2024 Term Loan A.

In 2022, we issued $ 2.00 billion of senior unsecured notes and received cash of $ 1.99 billion.

The approximate $ 1.00 billion of net proceeds from the issuance of the 2032 Green Bonds are being used to fund eligible sustainability-focused projects.

The remaining proceeds, along with cash on hand, were used to repay $ 1.85 billion of principal amount of notes (carrying value of $ 1.85 billion) for $ 1.93 billion in cash.

We recognized losses of $ 83 million in connection with these repayments.

In 2021, substantially all holders of our 2032D Notes converted their notes.

We settled these conversions and all remaining 2032D Notes with $ 185 million in cash and 11.1 million shares of our stock, which approximated the carrying value of debt and equity for those notes.

We prepaid $ 1.85 billion of principal amount of notes for $ 1.93 billion in cash.

We recognized losses of $ 83 million in connection with these prepayments.

Senior Unsecured Notes

We may redeem our 2026 Notes, 2027 Notes, 2028 Notes, 2029 A Notes, 2029 B Notes, 2030 Notes, 2032 Green Bonds, 2033 A Notes, 2033 B Notes, 2041 Notes, and 2051 Notes (the “Senior Unsecured Notes”), in whole or in part, at our option prior to their respective maturity dates at a redemption price equal to the greater of (i) 100 % of the principal amount of the notes to be redeemed and (ii) the present value of the remaining scheduled payments of principal and interest, in each case plus accrued interest.

We may redeem our 2026 Notes, 2027 Notes, 2028 Notes, 2029 A Notes, 2029 B Notes, 2030 Notes, 2031 Notes, 2032 Green Bonds, 2033 A Notes, 2033 B Notes, 2041 Notes, and 2051 Notes (the “Senior Unsecured Notes”), in whole or in part, at our option prior to their respective maturity dates at a redemption price equal to the greater of (i) 100 % of the principal amount of the Senior Unsecured Notes to be redeemed and (ii) the present value of the remaining scheduled payments of principal and interest, in each case plus accrued interest.

We may also redeem any series of our Senior Unsecured Notes, in whole or in part, at a price equal to par between one and six months prior to maturity in accordance with the respective terms of such series.

71 | 2023 10-K

Each series of Senior Unsecured Notes contains covenants that, among other things, limit, in certain circumstances, our ability and/or the ability of our restricted subsidiaries (which are generally domestic subsidiaries in which we own at least 80 % of the voting stock and which own principal property, as defined in the indenture governing such series) to (1) create or incur certain liens;

3 unchanged sentences

Additionally, if a change of control triggering event, as defined in the indentures governing our Senior Unsecured Notes, occurs with respect to a series of Senior Unsecured Notes, we will be required to offer to purchase such Senior Unsecured Notes at 101 % of the outstanding aggregate principal amount plus accrued interest up to the purchase date.

2032 Green Bonds:

We plan to allocate an amount equal to the approximate $ 1.00 billion of net proceeds of our unsecured 2032 Green Bonds by November 1, 2023, to fund eligible sustainability-focused projects involving renewable energy, green buildings, energy efficiency, water management, waste abatement, and a circular economy.

Multi-Tranche Term Loan A

In 2023, we entered into a term loan agreement consisting of three tranches (the “Multi-Tranche Term Loan Agreement”) and borrowed $ 3.20 billion in aggregate principal amount.

The tranches mature on November 3, 2025 (“2025 Term Loan A”);

November 3, 2026 (“2026 Term Loan A”);

and November 3, 2027 (“2027 Term Loan A”).

The 2026 Term Loan A and 2027 Term Loan A each require equal quarterly installment payments in an amount equal to 1.25 % of the original principal amount.

The 2025 Term Loan A does not require quarterly installment payments.

Multi-Tranche Term Loan Agreement

The 2026 Term Loan A and 2027 Term Loan A (the “Multi-Tranche Term Loan Agreement”) require equal quarterly installment payments in an amount equal to 1.25 % of the original principal amount.

Borrowings under the Multi-Tranche Term Loan Agreement will generally bear interest at adjusted term SOFR plus an applicable interest rate margin ranging from 1.00 % to 2.00 %, varying by tranche and depending on our corporate credit ratings.

Adjusted term SOFR for the Multi-Tranche Term Loan Agreement is the SOFR benchmark plus 0.10 %.

The Multi-Tranche Term Loan Agreement requires us to maintain, on a consolidated basis, a leverage ratio of total indebtedness to adjusted EBITDA, as defined in the Multi-Tranche Term Loan Agreement and calculated as of the last day of each fiscal quarter, not to exceed 3.25 to 1.00.

On March 27, 2023, we amended the Multi-Tranche Term Loan Agreement to provide that in lieu of the foregoing leverage ratio, during the fourth quarter of 2023 and each quarter of 2024, we will be required to maintain, on a consolidated basis, a net leverage ratio of total net indebtedness to adjusted EBITDA, as defined in the Multi-Tranche Term Loan Agreement and calculated as of the last day of each fiscal quarter, not to exceed 3.25 to 1.00.

Alternatively, for up to three of such five quarters, we may elect to comply with a requirement of minimum liquidity, as defined in the Multi-Tranche Term Loan Agreement, of not less than $ 5.0 billion.

In the fourth quarter of 2023, we complied with the net leverage ratio.

Each of the leverage ratio and net leverage ratio maximums, as applicable, is subject to a temporary four quarter increase in such ratio to 3.75 to 1.00 following certain material acquisitions.

73 | 2024 10-K

The Multi-Tranche Term Loan Agreement contains other covenants that, among other things, limit, in certain circumstances, our ability and/or the ability of our restricted subsidiaries to (1) create or incur certain liens and enter into sale and lease-back transactions, (2) create, assume, incur, or guarantee certain additional secured indebtedness and unsecured indebtedness of our restricted subsidiaries, and (3) consolidate with or merge with or into, or convey, transfer, lease, or otherwise dispose of all or substantially all of our assets, to another entity.

1 unchanged sentence

Our obligations under the Multi-Tranche Term Loan Agreement are unsecured.

2024 Term Loan A

On April 13, 2023, we used a portion of the proceeds from our April 2023 issuance of senior unsecured notes to prepay $ 600 million principal amount of our 2024 Term Loan A.

On June 7, 2023, the 2024 Term Loan A agreement was amended, pursuant to its transition provisions, to replace LIBOR-based benchmark rates with SOFR-based benchmark rates effective July 1, 2023.

Subsequent to this amendment, borrowings under the 2024 Term Loan Agreement generally bear interest at adjusted term SOFR plus an applicable interest rate margin ranging from 0.625 % to 1.375 % depending on our corporate credit ratings.

Adjusted term SOFR for the 2024 Term Loan A is the SOFR benchmark plus a credit spread adjustment ranging from approximately 0.11 % to 0.43 % depending on the applicable interest period selected.

Prior to July 1, 2023, the 2024 Term Loan A bore interest at a rate equal to LIBOR plus 0.625 % to 1.375 % based on our corporate credit ratings.

The 2024 Term Loan A agreement contains the same leverage ratio, as amended, and substantially the same other covenants as the Multi-Tranche Term Loan Agreement.

Our obligations under the 2024 Term Loan A agreement are unsecured.

Revolving Credit Facility

3 unchanged sentences

Any amounts outstanding under the Revolving Credit Facility would mature in May 2026 and amounts borrowed may be prepaid without penalty.

The Revolving Credit Facility contains the same leverage ratio, as amended, and substantially the same other covenants as the Multi-Tranche Term Loan Agreement.

The Revolving Credit Facility contains the same leverage ratio and substantially the same other covenants as the Multi-Tranche Term Loan Agreement.

Maturities of Notes Payable

3 unchanged sentences

Hedge accounting fair value adjustment ( 60 )

As of August 31, 2023, we had noncancelable commitments with remaining contractual terms in excess of one year of approximately $ 6.7 billion for purchase obligations, of which approximately $ 1.2 billion will be due in 2024, $ 1.4 billion due in 2025, $ 1.0 billion due in 2026, $ 1.0 billion due in 2027, $ 700 million due in 2028, and $ 1.4 billion due in 2029 and thereafter.

As of August 29, 2024, we had noncancelable commitments with remaining contractual terms in excess of one year of approximately $ 6.7 billion for purchase obligations, of which approximately $ 1.7 billion will be due in 2025, $ 1.7 billion due in 2026, $ 1.0 billion due in 2027, $ 800 million due in 2028, $ 200 million due in 2029, and $ 1.3 billion due in 2030 and thereafter.

Purchase obligations primarily include payments for goods or services with either a fixed or minimum quantity and price, which includes payments for the acquisition of property, plant, and equipment.

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This contract is expected to supply the majority of our power consumption needs in Singapore with more favorable pricing than our previous supply arrangements.

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Contingencies

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As is typical in the semiconductor and other high-tech industries, from time to time, others have asserted, and may in the future assert, that our products or manufacturing processes infringe upon their intellectual property rights.

On March 19, 2018, Micron Semiconductor (Xi’an) Co., Ltd.

(“MXA”) was served with a patent infringement complaint filed by Fujian Jinhua Integrated Circuit Co., Ltd.

(“Jinhua”) in the Fuzhou Intermediate People’s Court in Fujian Province, China (the “Fuzhou Court”).

On April 3, 2018, Micron Semiconductor (Shanghai) Co.

(“MSS”) was served with the same complaint.

The complaint alleges that MXA and MSS infringed one Chinese patent by manufacturing and selling certain Crucial DDR4 DRAM modules.

The complaint seeks an order requiring MXA and MSS to destroy inventory of the accused products and equipment for manufacturing the accused products in China;

to stop manufacturing, using, selling, and offering for sale the accused products in China;

and to pay damages of 98 million Chinese yuan plus court fees incurred.

On March 21, 2018, MXA was served with a patent infringement complaint filed by United Microelectronics Corporation (“UMC”) in the Fuzhou Court.

On April 3, 2018, MSS was served with the same complaint.

The complaint alleges that MXA and MSS infringed one Chinese patent by manufacturing and selling certain Crucial DDR4 DRAM modules.

The complaint seeks an order requiring MXA and MSS to destroy inventory of the accused products and equipment for manufacturing the accused products in China;

to stop manufacturing, using, selling, and offering for sale the accused products in China;

and to pay damages of 90 million Chinese yuan plus court fees incurred.

On November 26, 2021, pursuant to a settlement agreement between UMC and Micron, UMC filed an application to the Fuzhou Court to withdraw its complaints against MXA and MSS.

On April 3, 2018, MSS was served with another patent infringement complaint filed by Jinhua and an additional complaint filed by UMC in the Fuzhou Court.

The additional complaints allege that MSS infringes two Chinese patents by manufacturing and selling certain Crucial MX300 SSDs.

The complaint filed by UMC seeks an order requiring MSS to destroy inventory of the accused products and equipment for manufacturing the accused products in China;

to stop manufacturing, using, selling, and offering for sale the accused products in China;

and to pay damages of 90 million Chinese yuan plus court fees incurred.

The complaint filed by Jinhua seeks an order requiring MSS to destroy inventory of the accused products and equipment for manufacturing the accused products in China;

to stop manufacturing, using, selling, and offering for sale the accused products in China;

and to pay damages of 98 million Chinese yuan plus court fees incurred.

On November 26, 2021, pursuant to a settlement agreement between UMC and Micron, UMC filed an application to the Fuzhou Court to withdraw its complaint against MSS.

On July 5, 2018, MXA and MSS were notified that the Fuzhou Court granted a preliminary injunction against those entities that enjoins them from manufacturing, selling, or importing certain Crucial and Ballistix-branded DRAM modules and solid-state drives in China.

We are complying with the ruling and have requested the Fuzhou Court to reconsider or stay its decision.

A description of certain claims is below.

On April 28, 2021, Netlist, Inc.

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seek injunctive relief, damages, and attorneys’ fees.

On May 23, 2024, following a four-day trial regarding the second complaint filed by Netlist in the E.D.

Tex., a jury rendered a verdict that Micron’s memory modules infringe two asserted patents — U.S.

7,619,912 (“the ‘912 patent”) and U.S.

11,093,417 (“the ‘417 patent”) — and found that Micron should pay $ 425 million for infringement of the ‘912 patent and $ 20 million for infringement of the ‘417 patent.

Micron expects to appeal the verdict.

On April 17, 2024, the Patent Trial and Appeal Board (“PTAB”) of the United States Patent and Trademark Office (“USPTO”) issued a final written decision (“FWD”) finding unpatentable the sole asserted claim of the ‘912 patent.

Netlist sought review of that ruling by the Director of the USPTO, which was denied on July 10, 2024.

On July 30, 2024, the USPTO issued a FWD finding unpatentable all asserted claims of the ‘417 patent.

In the case of each of the ‘912 and ‘417 patents, if the United States Court of Appeals for the Federal Circuit affirms the FWD, then the affirmed FWD will preclude any pending actions asserting infringement of such patent (including any infringement verdict that is subject to an ongoing appeal).

On August 16, 2022, Sonrai Memory Ltd.

filed a patent infringement action against Micron in the U.S.

filed a patent infringement complaint against Micron in the U.S.

District Court for the Western District of Texas.

The complaint alleges that two U.S.

The complaint alleged that two U.S.

patents are infringed by certain SSD and NAND flash products.

The complaint seeks damages, attorneys’ fees, and costs.

The complaint sought damages, attorneys’ fees, and costs.

On September 6, 2024, pursuant to a motion jointly filed by the parties, the court dismissed Sonrai’s complaint.

On January 23, 2023, Besang Inc.

filed a patent infringement complaint against Micron in the U.S.

District Court for the Eastern District of Texas.

District Court for the E.D.

The complaint alleges that one U.S.

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The complaint seeks an injunction, damages, attorneys’ fees, and costs.

Among other things, the above lawsuits pertain to substantially all of our DRAM, NAND, and other memory and storage products we manufacture, which account for substantially all of our revenue.

On January 20, 2011, Dr.

Michael Jaffé, administrator for Qimonda’s insolvency proceedings, filed suit against Micron and Micron Semiconductor B.V.

(“Micron B.V.”), in the District Court of Munich, Civil Chamber.

The complaint sought to void, under Section 133 of the German Insolvency Act, a share purchase agreement between Micron B.V.

and Qimonda signed in fall 2008, pursuant to which Micron B.V.

purchased substantially all of Qimonda’s shares of Inotera (the “Inotera Shares”), representing approximately 18 % of Inotera’s outstanding shares at that time, and sought an order requiring us to re-transfer those shares to the Qimonda estate.

The complaint also sought, among other things, to recover damages for the alleged value of the joint venture relationship with Inotera and to terminate, under Sections 103 or 133 of the German Insolvency Code, a patent cross-license between us and Qimonda entered into at the same time as the share purchase agreement.

Following a series of hearings with pleadings, arguments, and witnesses on behalf of the Qimonda estate, on March 13, 2014, the court issued judgments:

(1) ordering Micron B.V.

to pay approximately $ 1 million in respect of certain Inotera Shares sold in connection with the original share purchase;

(2) ordering Micron B.V.

to disclose certain information with respect to any Inotera Shares sold by it to third parties;

(3) ordering Micron B.V.

to disclose the benefits derived by it from ownership of the Inotera Shares, including in particular, any profits distributed on the Inotera Shares and all other benefits;

(4) denying Qimonda’s claims against Micron for any damages relating to the joint venture relationship with Inotera;

and (5) determining that Qimonda’s obligations under the patent cross-license agreement are canceled.

In addition, the court issued interlocutory judgments ordering, among other things:

(1) that Micron B.V.

transfer to the Qimonda estate the Inotera Shares still owned by Micron B.V.

and pay to the Qimonda estate compensation in an amount to be specified for any Inotera Shares sold to third parties;

and (2) that Micron B.V.

pay the Qimonda estate as compensation an amount to be specified for benefits derived by Micron B.V.

from ownership of the Inotera Shares.

The interlocutory judgments had no immediate, enforceable effect and Micron, accordingly, was able to continue to operate with full control of the Inotera Shares subject to further developments in the case.

Micron and Micron B.V.

appealed the judgments to the German Appeals Court, which thereafter appointed an independent expert to perform an evaluation of Dr.

Jaffé’s claims that the amount Micron paid for Qimonda was less than fair market value.

On March 31, 2020, the expert presented an opinion to the Appeals Court concluding that the amount paid by Micron was within an acceptable range of fair value.

On October 5, 2022, the Appeals Court ruled that the relevant issue to be addressed is whether Qimonda's creditors were prejudiced such that the original transaction should be voided.

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On May 9, 2023, Micron and Dr.

Jaffé reached an agreement to dismiss the case in exchange for a one-time payment by Micron to the Qimonda estate and a waiver of each party’s claims.

The agreement was formally entered by the Appeals Court in July 2023 and the case was dismissed.

On November 9, 2023, Yangtze Memory Technologies Company, Ltd.

(“YMTC”) filed a patent infringement complaint against Micron and one of its subsidiaries in the U.S.

District Court for the Northern District of California (“N.D.

The complaint alleges that eight U.S.

patents are infringed by certain of our 3D NAND products.

The complaint seeks an injunction, damages, attorneys’ fees, and costs.

On January 22, 2024, Micron Semiconductor (Shanghai) Co., Ltd.

(“MSS”) was served with three patent infringement complaints filed by YMTC in Beijing Intellectual Property Court and on February 27, 2024, Micron Technology, Inc.

(“MTI”) was served with the same complaints.

The complaints assert that MTI and MSS infringed three Chinese patents owned by YMTC by importing, selling, offering for sale, and assisting others to sell certain 3D NAND products and SSDs in China.

The complaint seeks an injunction, damages, attorneys’ fees, and costs.

On July 12, 2024, YMTC filed a second complaint against the Company and its subsidiary in N.D.

The second complaint alleges that eleven U.S.

patents are infringed by certain of our 3D NAND and DDR5 DRAM products.

The complaint seeks an injunction, damages, attorneys’ fees, and costs.

On September 11, 2024, MSS was served with five patent infringement complaints filed by YMTC in Shanghai Intellectual Property Court.

The complaints assert that MTI and MSS infringed five Chinese patents owned by YMTC by importing, selling, offering for sale, and assisting others to sell certain 3D NAND products and SSDs in China.

The complaint seeks an injunction, damages, attorneys’ fees, and costs.

On June 3, 2024, MimirIP LLC (“MimirIP”) submitted a complaint to the United States International Trade Commission (“ITC”) alleging that certain of Micron’s DRAM and NAND products infringe six patents owned by MimirIP.

The complaint requested the ITC to institute an investigation of such alleged infringement pursuant to Section 337 of the Tariff Act of 1930 and to issue a permanent limited exclusion order barring from entry into the United States such allegedly infringing DRAM and NAND devices and electronic devices containing the same produced by several alleged customers of Micron.

On August 27, 2024, MimirIP and the Company filed a joint motion to terminate the ITC investigation, which was granted on September 12, 2024.

On June 3, 2024, MimirIP filed a complaint against Micron, two of its subsidiaries, and certain alleged customers of Micron in the E.D.

alleging that the same six patents as are asserted in the ITC are infringed by certain of Micron’s DRAM and NAND products.

The complaint sought damages, attorneys’ fees, and costs.

On August 30, 2024, the court dismissed the complaint pursuant to a notice of voluntary dismissal filed by MimirIP.

On June 4, 2024, MimirIP filed a second complaint against Micron, two of its subsidiaries, and certain alleged customers of Micron in the E.D.

alleging that six additional patents are infringed by certain of Micron’s DRAM and NAND products.

The complaint sought damages, attorneys’ fees, and costs.

On August 30, 2024, the court dismissed the complaint pursuant to a notice of voluntary dismissal filed by MimirIP.

The above lawsuits pertain to substantially all of our DRAM, NAND, and other memory and storage products we manufacture, which account for substantially all of our revenue.

Antitrust Matters

Six cases have been filed against Micron alleging price fixing of DRAM products in the following Canadian courts on the dates indicated:

Superior Court of Quebec (April 30, 2018 and May 3, 2018), the Federal Court of Canada (May 2, 2018), the Ontario Superior Court of Justice (May 15, 2018), and the Supreme Court of British Columbia (May 10, 2018).

The plaintiffs in these cases are individuals seeking certification of class actions on behalf of direct and indirect purchasers of DRAM in Canada (or regions of Canada) between June 1, 2016 and February 1, 2018.

On May 15, 2018, the Chinese State Administration for Market Regulation (“SAMR”) notified Micron that it was investigating potential collusion and other anticompetitive conduct by DRAM suppliers in China.

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We are cooperating with SAMR in its investigation.

Securities Matters

On February 9, 2021, a derivative complaint was filed by a shareholder against Sanjay Mehrotra and other current and former directors of Micron, allegedly on behalf of and for the benefit of Micron, in the U.S.

District Court for the District of Delaware alleging violations of securities laws, breaches of fiduciary duties, and other violations of law involving allegedly false and misleading statements about Micron’s commitment to diversity and progress in diversifying its workforce, executive leadership, and Board of Directors.

The complaint seeks damages, fees, interest, costs, and an order requiring Micron to take various actions to allegedly improve its corporate governance and internal procedures.

Other Matters

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The repurchase authorization has no expiration date, does not obligate us to acquire any common stock, and is subject to market conditions and our ongoing determination of the best use of available cash.

We repurchased 8.6 million shares of our common stock for $ 425 million in 2023 and 35.4 million shares for $ 2.43 billion in 2022.

We repurchased 3.2 million shares of our common stock for $ 300 million in 2024 and 8.6 million shares for $ 425 million in 2023.

Through August 29, 2024, we had repurchased an aggregate of $ 7.19 billion under the authorization.

Amounts repurchased are included in treasury stock.

In each quarter of 2023, we declared and paid dividends of $ 126 million ($ 0.115 per share).

In each quarter of 2024, we declared and paid dividends of $ 0.115 per share.

On September 25, 2024, our Board of Directors declared a quarterly dividend of $ 0.115 per share, payable in cash on October 23, 2024 , to shareholders of record as of the close of business on October 7, 2024 .

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Gains (Losses) on Derivative Instruments Unrealized Gains (Losses) on Investments Pension Liability Adjustments Cumulative Foreign Currency Translation Adjustment Total

As of September 1, 2022 $ ( 538 ) $ ( 47 ) $ 25 $ — $ ( 560 )

As of August 31, 2023 $ ( 304 ) $ ( 41 ) $ 36 $ ( 3 ) $ ( 312 )

Other comprehensive income (loss) before reclassifications

19 18 17 ( 3 ) 51

Amount reclassified out of accumulated other comprehensive income (loss)

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As of August 29, 2024 $ ( 162 ) $ ( 8 ) $ 39 $ ( 3 ) $ ( 134 )

77 | 2024 10-K

Fair Value Measurements

The estimated fair values and carrying values of our outstanding debt instruments were as follows:

As of August 31, 2023 As of September 1, 2022

As of August 29, 2024 As of August 31, 2023

Value Carrying

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The fair values of our debt instruments were estimated based on Level 2 inputs, including the trading price of our notes when available, discounted cash flows, and interest rates based on similar debt issued by parties with credit ratings similar to ours.

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Derivative Instruments

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Cash flow commodity hedges 471 20 ( 7 )

Fair value currency hedges

2,511 — ( 41 )

Fair value interest rate hedges 900 — ( 60 )

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$ 95 $ ( 182 )

As of September 1, 2022

As of August 31, 2023

Derivative instruments with hedge accounting designation

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$ 63 $ ( 297 )

(1) Forward and swap contracts are measured at fair value based on market-based observable inputs including market spot and forward rates, interest rates, and credit-risk spreads (Level 2).

(2) Included in receivables and other noncurrent assets.

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We utilize forward and swap contracts that generally mature within two years designated as cash flow hedges to minimize our exposure to changes in currency exchange rates or commodity prices for certain capital expenditures and manufacturing costs.

Forward and swap contracts are measured at fair value based on market-based observable inputs including market spot and forward rates, interest rates, and credit-risk spreads (Level 2).

We recognized gains from cash flow hedges of $ 30 million for 2023, and losses of $ 735 million and $ 52 million for 2022 and 2021, respectively, in accumulated other comprehensive income (loss).

We recognized losses related to amounts excluded from hedge effectiveness testing on our cash flow hedges of $ 101 million in 2023 in cost of goods sold through an amortization approach.

The amounts recognized in 2022 and 2021 were not significant.

We reclassified losses of $ 261 million and $ 53 million in 2023 and 2022, respectively, and gains of $ 41 million in 2021, from accumulated other comprehensive income (loss) to earnings, primarily to cost of goods sold.

The effects of cash flow hedging activities were as follows:

For the year ended 2024 2023 2022

Gain (loss) from cash flow hedges in accumulated other comprehensive income (loss) $ 33 $ 30 $ ( 735 )

Gain (loss) excluded from effectiveness testing in cost of goods sold ( 135 ) ( 101 ) ( 32 )

Gain (loss) reclassified from accumulated other comprehensive income (loss) to earnings, primarily to cost of goods sold ( 172 ) ( 261 ) ( 53 )

As of August 29, 2024, we expect to reclassify $ 89 million of pre-tax losses related to cash flow hedges from accumulated other comprehensive income (loss) into earnings in the next 12 months.

Fair Value Hedges :

We utilize fixed-to-floating interest rate swaps designated as fair value hedges to minimize certain exposures to changes in the fair value of fixed-rate debt that result from fluctuations in benchmark interest rates.

Interest rate swaps are measured at fair value based on market-based observable inputs including interest rates and credit-risk spreads (Level 2).

We utilize currency forward contracts that generally mature within one year designated as fair value hedges to minimize our exposure to changes in currency exchange rates for non-U.S.-dollar-denominated cash and investments in debt securities.

The fair value of our hedged cash and investments in debt securities was $ 2.58 billion as of August 29, 2024.

The changes in the fair values of derivatives designated as fair value hedges and the offsetting changes in the underlying fair values of the hedged items are both recognized in earnings.

When a derivative is no longer designated as a fair value hedge for any reason, including termination and maturity, the remaining unamortized difference between the carrying value of the hedged item at that time and the face value of the hedged item is amortized to earnings over the remaining life of the hedged item, or immediately if the hedged item has matured or been extinguished.

The effects of fair value currency hedges on our consolidated statements of operations, recognized in other non-operating income (expense), net, were not significant for the periods presented.

We also utilize fixed-to-floating interest rate swaps designated as fair value hedges to minimize certain exposures to changes in the fair value of fixed-rate debt that result from fluctuations in benchmark interest rates.

We recognized interest expense of $ 96 million for changes in the fair value of our interest rate swaps in 2022 and the impact to interest expense was not significant for 2024 or 2023.

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dollars and the associated outstanding forward contracts are marked to market.

Currency forward contracts are valued at fair values based on the middle of bid and ask prices of dealers or exchange quotations (Level 2).

Realized and unrealized gains and losses on derivative instruments without hedge accounting designation as well as the changes in the underlying monetary assets and liabilities from changes in currency exchange rates are included in other non-operating income (expense), net.

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We seek to mitigate such risk by limiting our counterparties to major financial institutions and by spreading risk across multiple financial institutions.

As of August 31, 2023 and September 1, 2022, amounts netted under our master netting arrangements were not significant.

As of August 31, 2023, 95 million shares of our common stock were available for future awards under our equity plans, including 14 million shares approved for issuance under our employee stock purchase plan (“ESPP”).

As of August 29, 2024 and August 31, 2023, amounts netted under our master netting arrangements were not significant.

Equity Compensation Plans

As of August 29, 2024, 69 million shares of our common stock were available for future awards under our equity compensation plans, including 11 million shares approved for issuance under our employee stock purchase plan (“ESPP”).

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Restricted Stock and Restricted Stock Units (“Restricted Stock Awards”)

As of August 31, 2023, there were 29 million shares of Restricted Stock Awards outstanding, 26 million of which contained only service conditions.

For service-based Restricted Stock Awards granted through October 2021, restrictions generally lapse in one-fourth or one-third increments during each year of employment after the grant date.

For service-based Restricted Stock Awards granted beginning in November 2021, restrictions generally lapse on 25 % or 33 % of the units granted after the first year and on 6.25 % or 8.33 % each quarter thereafter over the remaining three or two years of employment.

Restrictions generally lapse on Restricted Stock with performance or market conditions as conditions are met over a 3 -year period.

As of August 29, 2024, there were 28 million shares of Restricted Stock Awards outstanding, 24 million of which are only subject to service-based vesting conditions.

Service-based Restricted Stock Awards granted through October 2021 generally vest in one-fourth or one-third increments during each year of employment after the grant date.

Service-based Restricted Stock Awards granted after October 2021 generally vest on 25 % or 33 % of the units granted after the first year and on 6.25 % or 8.33 % each quarter thereafter over the remaining three or two years of employment.

Restricted Stock Awards with performance or market-based vesting conditions vest over a 3 -year period as conditions are met.

At the end of the performance period, the number of actual shares to be awarded will vary between 0 % and 200 % of target amounts, depending upon the achievement level.

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Number of Shares Weighted-Average Grant Date Fair Value Per Share

Outstanding as of September 1, 2022 23 $ 60.93

Outstanding as of August 31, 2023

Granted 13 72.72

Restrictions lapsed ( 9 ) 58.23

Canceled ( 2 ) 58.00

Outstanding as of August 29, 2024

79 | 2023 10-K

For the year ended 2024 2023 2022

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Employee Stock Purchase Plan (“ESPP”)

Our ESPP is offered to substantially all employees and permitted eligible employees to purchase shares of our common stock through payroll deductions of up to 10 % of their eligible compensation, subject to certain limitations prior to August 2021.

Beginning in August 2021, employees are permitted to deduct up to 15 % of their eligible compensation to purchase shares under the ESPP.

Our ESPP is offered to substantially all employees and permitted eligible employees to purchase shares of our common stock through payroll deductions of up to 15 % of their eligible compensation, subject to certain limitations.

The purchase price of the shares under the ESPP equals 85 % of the lower of the fair market value of our common stock on either the first or last day of each six -month offering period.

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Stock Options

As of August 31, 2023, stock options of 2 million shares were outstanding, all of which were fully exercisable.

Stock options expire 8 years from the date of grant.

We did not grant any stock options in 2023, 2022, or 2021.

We last granted stock options in September 2018 and as of August 29, 2024, our outstanding stock options were not material.

Stock options of 1.3 million shares were exercised in 2024.

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Stock-based compensation expense by caption

Research and development $ 226 $ 175 $ 110

Cost of goods sold $ 312 $ 201 $ 193

Research and development 296 226 175

Selling, general, and administrative 213 137 133

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Income tax benefits for share-based awards were $ 140 million, $ 68 million, and $ 77 million for 2024, 2023, and 2022, respectively.

Stock-based compensation expense of $ 88 million and $ 48 million was capitalized and remained in inventory as of August 31, 2023 and September 1, 2022, respectively.

Stock-based compensation expense of $ 99 million and $ 88 million was capitalized and remained in inventory as of August 29, 2024 and August 31, 2023, respectively.

As of August 29, 2024, $ 1.44 billion of total unrecognized compensation costs for unvested awards, before the effect of any future forfeitures, was expected to be recognized through the fourth quarter of 2028, resulting in a weighted-average period of 1.2 years.

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As of August 29, 2024, the projected benefit obligations of our plans were $ 191 million and plan assets were $ 261 million.

As of September 1, 2022, the projected benefit obligations of our plans were $ 186 million and plan assets were $ 221 million.

As of August 31, 2023, the projected benefit obligations of our plans were $ 175 million and plan assets were $ 232 million.

Pension expense was not material for 2024, 2023, or 2022.

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Government Incentives

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Other noncurrent assets 188

Other current liabilities 11

Noncurrent unearned government incentives 550

As of August 31, 2023, we had aggregate commitments from various governmental entities of up to $ 2 billion to be received through 2033 (in addition to the receivables and other noncurrent assets in the table above), subject to achievement of certain performance conditions.

We also receive a 25% investment tax credit on qualified investments in U.S.

Beginning in 2023, we receive a 25 % investment tax credit on qualified investments in U.S.

semiconductor manufacturing under the CHIPS Act.

Subsequent to August 31, 2023, we finalized an incentive arrangement under which we will receive additional grants of up to $ 1.3 billion.

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Government incentives related to capital expenditures have reduced property, plant and equipment by $ 1.57 billion as of August 31, 2023, of which $ 584 million pertained to 2023 expenditures.

In 2023, operating income (loss) benefited by $ 318 million (approximately 93 % in COGS and 7 % in R&D) from government incentives recognized as a reduction of expense, primarily in the form of reduced depreciation expense.

Revenue is primarily recognized at a point in time when control of the promised goods is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods.

Substantially all contracts with our customers are short-term in duration at fixed, negotiated prices with payment generally due shortly after delivery.

From time to time, we have contracts with initial terms that include performance obligations that extend beyond one year.

As of August 31, 2023, our future performance obligations beyond one year were not significant.

As of August 31, 2023 and September 1, 2022, other current liabilities included $ 453 million and $ 1.26 billion, respectively, for estimates of consideration payable to customers including estimates for pricing adjustments and returns.

In 2023, we received an aggregate of $ 228 million from settlements of insurance claims involving a power disruption in 2022 and an operational disruption in 2017, of which $ 186 million was for business interruption and recognized in revenue.

As qualified investments are made, we recognize investment tax credits in receivables or other noncurrent assets.

We have signed a non-binding preliminary memorandum of terms with the U.S.

Department of Commerce for up to $ 6.1 billion in direct funding under the CHIPS Act for our planned fab in Boise, Idaho and the first two planned fabs in Clay, New York.

We are also eligible for federal loans up to $ 7.5 billion.

We have also signed a non-binding term sheet with the state of New York that provides up to $ 5.5 billion in funding for the planned four-fab facility over the next 20-plus years through a combination of tax credits for qualified capital investments and incentives for eligible new job wages.

In addition to the receivables and other noncurrent assets in the table above, as of August 29, 2024, we had aggregate commitments from various governmental entities of up to $ 3.4 billion to be received through 2033, subject to achievement of certain performance conditions.

The commitment amount includes $ 1.8 billion ( 150 billion Indian rupees) for the construction of a new assembly and test facility in Gujarat, India.

We will receive incentives representing 50 % of the total project cost from the Indian central government and 20 % of the total project cost from the state of Gujarat.

The commitment amount also includes up to $ 1.3 billion ( 188 billion Japanese yen) from the Japanese Ministry of Economy, Trade and Industry to support the production of DRAM using EUV lithography in Hiroshima, Japan.

Government incentives related to capital expenditures have reduced property, plant and equipment by $ 2.34 billion as of August 29, 2024, of which $ 1.10 billion pertained to 2024 expenditures.

In 2024, operating income (loss) benefited by $ 588 million ( approximately 85 % in COGS and 15 % in R&D ) from government incentives recognized as a reduction of expense.

Revenue and Customer Contract Liabilities

Revenue by Technology

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See “Segment and Other Information” for disclosure of disaggregated revenue by market segment.

Substantially all contracts with our customers are short-term in duration at fixed, negotiated prices with payment generally due shortly after delivery.

From time to time, we have contracts with initial terms that include performance obligations that extend beyond one year.

As of August 29, 2024, our future performance obligations beyond one year were $ 141 million, which included customer prepayments and other contract liabilities.

Customer prepayments made to secure product supply in future periods and other contract liabilities were $ 907 million as of August 29, 2024, of which $ 766 million was reported in other current liabilities and the remainder in other noncurrent liabilities.

As of August 29, 2024 and August 31, 2023, other current liabilities included $ 718 million and $ 453 million, respectively, for estimates of consideration payable to customers including estimates for pricing adjustments and returns.

Restructure and Asset Impairments

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$ 1 $ 171 $ 48

In 2023, we initiated the 2023 Restructure Plan in response to challenging industry conditions.

Under the 2023 Restructure Plan, we expect our headcount reduction to approach 15 % by the end of calendar 2023 through a combination of voluntary attrition and personnel reductions.

In connection with the plan, we incurred restructure charges of $ 171 million in 2023, primarily related to employee severance costs.

The plan was substantially completed in the third quarter of 2023.

As of August 31, 2023, we had paid $ 167 million in 2023 in connection with the 2023 Restructure Plan and the remaining liability was $ 4 million.

Restructure and asset impairments for 2022 and 2021 are primarily related to the sale of our Lehi, Utah facility.

See “Lehi, Utah Fab and 3D XPoint.”

In 2023, we initiated a restructure plan in response to challenging industry conditions (the “2023 Restructure Plan”).

Under the 2023 Restructure Plan, we reduced our headcount by approximately 15 % by the end of calendar 2023, through a combination of voluntary attrition and personnel reductions.

The plan was substantially completed in 2023.

Restructure and asset impairments for 2022 primarily related to the sale of our Lehi, Utah facility to Texas Instruments Incorporated.

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Other Operating (Income) Expense, Net

For the year ended 2024 2023 2022

Goodwill impairment

Patent cross-license agreement gain

$ ( 200 ) $ — $ —

Litigation settlement 68 — —

Patent license charges — — 128

(Gain) loss on disposition of property, plant, and equipment

( 59 ) ( 54 ) ( 41 )

Other 9 7 ( 9 )

$ 124 $ ( 34 ) $ 95

Other Non-Operating Income (Expense), Net

For the year ended 2023 2022 2021

Gain (loss) on investments $ ( 8 ) $ 26 $ 82

Loss on debt repurchases and conversions

— ( 83 ) ( 1 )

Other 15 19 —

Goodwill impairment

Litigation settlement — 68 —

$ ( 251 ) $ 124 $ ( 34 )

We performed a qualitative assessment for goodwill impairment in 2024 and did not identify any impairment indicators for our reporting units.

Due to 2023 global and macroeconomic challenges, as well as lower expected demand resulting from customer actions to reduce elevated inventory levels, we performed a 2023 quantitative assessment for goodwill impairment for each of our reporting units.

We evaluated the fair value of our reporting units based on an income approach, using a discounted cash flow methodology.

We recognized a $ 101 million charge in 2023, included in other operating income (loss) to impair all of the goodwill assigned to our SBU reporting unit based on our best estimates of projected future cash flows at that time.

The 2023 quantitative assessment for all of our other reporting units yielded fair values that substantially exceeded their carrying values.

Our income tax (provision) benefit consisted of the following:

12 unchanged sentences

Foreign ( 53 ) 91 97

( 35 ) 7 ( 294 )

Income tax (provision) benefit $ ( 451 ) $ ( 177 ) $ ( 888 )

83 | 2023 10-K

The table below reconciles our tax (provision) benefit based on the U.S.

9 unchanged sentences

State taxes, net of federal benefit 12 ( 1.0 ) 37 0.7 — —

Debt premium deductions — — % — — % 130 ( 2.1 ) %

Other 42 ( 3.4 ) ( 86 ) ( 1.5 ) 85 ( 0.9 )

2 unchanged sentences

These incentives expire, in whole or in part, at various dates through 2034 and are conditional, in part, upon meeting certain business operations and employment thresholds.

As a result of a loss before taxes and geographic mix of income, the benefit from tax incentive arrangements was not material for 2023.

These arrangements reduced our tax provision by $ 1.12 billion (benefiting our diluted earnings per share by $ 1.00 ) for 2022 and by $ 758 million ($ 0.66 per diluted share) for 2021.

As a result of low level of profitability and geographic mix of income, the benefit from tax incentive arrangements was not material for 2024 or 2023.

These arrangements reduced our tax provision by $ 1.12 billion ($ 1.00 per diluted share) for 2022.

As of August 29, 2024, certain non-U.S.

2 unchanged sentences

Determination of the amount of unrecognized deferred tax liabilities related to investments in these foreign subsidiaries is not practicable.

85 | 2024 10-K

Deferred income taxes reflect the net tax effects of temporary differences between the bases of assets and liabilities for financial reporting and income tax purposes as well as carryforwards.

1 unchanged sentence

As of August 29,

2023 September 1,

2024 August 31,

Deferred tax assets

3 unchanged sentences

Inventories 4 52

Property, plant, and equipment — 44

Gross deferred tax assets 1,470 1,413

4 unchanged sentences

Property, plant, and equipment

( 194 ) ( 31 )

Other ( 70 ) ( 100 )

5 unchanged sentences

We assess positive and negative evidence for each jurisdiction to determine whether it is more likely than not that existing deferred tax assets will be realized.

As of August 31, 2023, and September 1, 2022, we had a valuation allowance of $ 528 million and $ 471 million, respectively, against our net deferred tax assets, primarily related to carryforwards in U.S.

As of August 29, 2024, and August 31, 2023, we had a valuation allowance of $ 593 million and $ 528 million, respectively, against our net deferred tax assets, primarily related to carryforwards in U.S.

states and Malaysia.

1 unchanged sentence

As of August 29, 2024, our net operating loss carryforward amounts and expiration periods, as reported to tax authorities, were as follows:

Year of Expiration Singapore

Year of Expiration Malaysia

2025 - 2029 $ — $ — $ 47 $ 144 $ 3 $ 194

4 unchanged sentences

$ 1,224 $ 765 $ 724 $ 469 $ 129 $ 3,311

85 | 2023 10-K

As of August 31, 2023, our federal and state tax credit carryforward amounts and expiration periods, as reported to tax authorities, were as follows:

As of August 29, 2024, our tax credit carryforward amounts and expiration periods, as reported to tax authorities, were as follows:

Year of Tax Credit Expiration U.S.

Federal State Total

Federal State Other

2025 - 2029 $ — $ 61 $ — $ 61

11 unchanged sentences

Decreases related to tax positions from prior years ( 89 ) ( 33 ) ( 23 )

Decreases related to settlement with tax authorities

Ending unrecognized tax benefits $ 716 $ 744 $ 731

15 unchanged sentences

Weighted-average common shares outstanding – Basic 1,105 1,093 1,112

Dilutive effect of equity plans and convertible notes

Dilutive effect of equity compensation plans

Weighted-average common shares outstanding – Diluted 1,118 1,093 1,122

2 unchanged sentences

Diluted 0.70 ( 5.34 ) 7.75

87 | 2024 10-K

Antidilutive potential common shares excluded from the computation of diluted earnings per share, that could dilute basic earnings per share in the future, were as follows at the end of the periods shown:

For the year ended 2024 2023 2022

Equity plans 33 5 2

Equity compensation plans

Segment and Other Information

2 unchanged sentences

Compute and Networking Business Unit (“CNBU”) :

Includes memory products and solutions sold into client, cloud server, enterprise, graphics, and networking markets.

Includes memory products and solutions sold into the data center, PC, graphics, and networking markets.

Mobile Business Unit (“MBU”) :

Includes memory and storage products sold into smartphone and other mobile-device markets.

Includes memory and storage products sold into the smartphone and other mobile-device markets.

Embedded Business Unit (“EBU”) :

Includes memory and storage products and solutions sold into automotive, industrial, and consumer markets.

Includes memory and storage products and solutions sold into the intelligent edge through the automotive, industrial, and consumer embedded markets.

Storage Business Unit (“SBU”) :

Includes SSDs and component-level solutions sold into enterprise and cloud, client, and consumer storage markets.

Includes SSDs and component-level storage solutions sold into the data center, PC, and consumer markets.

Certain operating expenses directly associated with the activities of a specific segment are charged to that segment.

1 unchanged sentence

We do not identify or report internally our assets (other than goodwill) or capital expenditures by segment, nor do we allocate gains and losses from equity method investments, interest, other non-operating income or expense items, or taxes to segments.

87 | 2023 10-K

As of August 29, 2024 and August 31, 2023, CNBU, MBU, and EBU had goodwill of $ 855 million, $ 198 million, and $ 97 million, respectively.

For the year ended 2024 2023 2022

4 unchanged sentences

All Other 38 10 17

Total revenue

$ 25,111 $ 15,540 $ 30,758

6 unchanged sentences

948 ( 3,832 ) 10,281

Provision to write down inventories to net realizable value ( 1,831 ) — —

Lower costs from sale of inventory written down in prior periods 987 844 —

Patent cross-license agreement 200 — —

Stock-based compensation

Inventory accounting policy change to FIFO — — ( 133 )

Change in inventory cost absorption — — ( 160 )

3D XPoint inventory write-down — — ( 49 )

Restructure and asset impairments ( 171 ) ( 48 ) ( 488 )

( 821 ) ( 564 ) ( 501 )

Restructure and asset impairment ( 1 ) ( 171 ) ( 48 )

Provision to write down inventories to net realizable value

— ( 1,831 ) —

Goodwill impairment

Litigation settlement

Patent license charges — — ( 128 )

Other ( 9 ) ( 22 ) ( 30 )

356 ( 1,913 ) ( 579 )

Operating income (loss)

Total operating income (loss)

$ 1,304 $ ( 5,745 ) $ 9,702

8 unchanged sentences

$ 7,780 $ 7,756 $ 7,116

89 | 2024 10-K

Certain Concentrations

Revenue by market segment as an approximate percent of total revenue is presented in the table below:

Revenue by market segment as a percent of total revenue, rounded to the nearest 5%, is presented in the table below:

For the year ended 2024 2023 2022

Automotive, industrial, and consumer 25 % 15 % 15 %

Mobile 25 % 25 % 25 %

Client and graphics 15 % 20 % 20 %

Enterprise and cloud server 15 % 20 % 20 %

SSDs and other storage 15 % 15 % 15 %

Data center and networking

35 % 25 % 35 %

25 % 25 % 25 %

PC, graphics, and other

25 % 30 % 25 %

Intelligent edge – automotive, industrial, and consumer embedded

20 % 25 % 15 %

Percentages of total revenue may not total 100% due to rounding.

Revenue from one customer was 10 % (primarily included in MBU, EBU, and CNBU segments) of total revenue for 2024.

No customer accounted for 10% or more of total revenue in 2023.

Revenue from Kingston Technology Company, Inc.

was 12 % of total revenue in 2022 and revenue from WPG Holdings Limited was 11 % and 13 % of total revenue in 2022 and 2021, respectively.

Sales to Kingston were primarily included in our CNBU and SBU segments and sales to WPG were primarily included in our MBU, CNBU, and EBU segments.

Revenue from one customer was 12 % (primarily included in CNBU and SBU segments) and another customer was 11 % (primarily included in MBU, CNBU, and EBU segments) of total revenue in 2022.

We generally have multiple sources of supply for our raw materials and production equipment;

1 unchanged sentence

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash, money market accounts, certificates of deposit, fixed-rate debt securities, trade receivables, share repurchase, and derivative contracts.

We invest through high-credit-quality financial institutions and, by policy, generally limit the concentration of credit exposure by restricting investments with any single obligor and monitoring credit risk of bank counterparties on an ongoing basis.

We invest through high-credit-quality financial institutions and, by policy, generally limit the concentration of credit exposure by restricting investments with any single obligor and monitor credit risk of bank counterparties on an ongoing basis.

A concentration of credit risk may exist with respect to receivables of certain customers.

1 unchanged sentence

Historically, we have not experienced material losses on receivables.

A concentration of risk may also exist with respect to our foreign currency hedges as the number of counterparties to our hedges is limited and the notional amounts are relatively large.

A concentration of risk may also exist with respect to our derivative hedging programs as the number of counterparties to our hedges is limited and the notional amounts are relatively large.

We seek to mitigate such risk by limiting our counterparties to major financial institutions and through entering into master netting arrangements.

89 | 2023 10-K

Geographic Information

4 unchanged sentences

Mainland China (excluding Hong Kong) 3,045 2,181 3,311

Japan 987 1,696 1,652

Other Asia Pacific 1,330 752 1,223

Hong Kong 1,071 340 1,665

Japan 840 987 1,696

Other 131 96 147

2 unchanged sentences

As of August 29,

2023 September 1,

2024 August 31,

Taiwan $ 14,156 $ 12,926

4 unchanged sentences

China 486 395

Other 347 337

$ 40,394 $ 38,594

91 | 2024 10-K

Report of Independent Registered Public Accounting Firm

2 unchanged sentences

We have audited the accompanying consolidated balance sheets of Micron Technology, Inc.

and its subsidiaries (the “Company”) as of August 31, 2023 and September 1, 2022, and the related consolidated statements of operations, of comprehensive income (loss), of changes in equity and of cash flows for each of the three years in the period ended August 31, 2023, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended August 31, 2023 appearing under Item 15 (collectively referred to as the “consolidated financial statements”).

and its subsidiaries (the “Company”) as of August 29, 2024 and August 31, 2023, and the related consolidated statements of operations, of comprehensive income (loss), of changes in equity and of cash flows for each of the three years in the period ended August 29, 2024, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended August 29, 2024 appearing under Item 15 (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of August 29, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of August 31, 2023 and September 1, 2022 , and the results of its operations and its cash flows for each of the three years in the period ended August 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of August 29, 2024 and August 31, 2023 , and the results of its operations and its cash flows for each of the three years in the period ended August 29, 2024 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of August 29, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in the Significant Accounting Policies and Inventories notes to the consolidated financial statements, the Company changed the manner in which it accounts for inventory costing from the average cost inventory accounting method to the first-in, first-out inventory accounting method in 2021.

Basis for Opinions

11 unchanged sentences

We believe that our audits provide a reasonable basis for our opinions.

91 | 2023 10-K

Definition and Limitations of Internal Control over Financial Reporting

9 unchanged sentences

Net Realizable Value of Finished Goods and Work in Process Inventories

As described in the Inventories note to the consolidated financial statements, as of August 31, 2023, the Company had net finished goods and work in process inventories totaling $7.7 billion.

As described in the Inventories note to the consolidated financial statements, as of August 29, 2024, the Company had a net inventory balance for finished goods and work in process inventory totaling $8.1 billion.

As disclosed by management, determining the net realizable value of the Company's finished goods and work in process inventories involves significant judgments, including projecting future average selling prices, future sales volumes, and future cost per part.

The memory and storage industry environment deteriorated sharply in the fourth quarter of 2022 and throughout 2023 due to weak demand in many end markets combined with global and macroeconomic challenges and lower demand resulting from customer actions to reduce elevated inventory levels.

This led to significant reductions in average selling prices for both DRAM and NAND, resulting in declines in revenue across all of the Company’s business segments and nearly all end markets.

The Company recorded charges of $1.83 billion to cost of goods sold to write down the carrying value of work in process and finished goods inventories to their estimated net realizable value.

The principal considerations for our determination that performing procedures relating to the net realizable value of finished goods and work in process inventories is a critical audit matter are (i) the significant judgment by management in determining the net realizable value of finished goods and work in process inventories and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to future average selling prices and future cost per part.

Differences in future average selling prices used in calculating lower of cost or net realizable value adjustments can result in significant changes in the estimated net realizable value of finished goods and work in process inventories and accordingly the amount of write-down recorded.

The principal considerations for our determination that performing procedures relating to the net realizable value of finished goods and work in process inventories is a critical audit matter are (i) the significant judgment by management in determining the net realizable value of finished goods and work in process inventories and (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumption related to future average selling prices.

93 | 2024 10-K

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s determination of the net realizable value of finished goods and work in process inventories, including controls over significant assumptions and data utilized.

These procedures included testing the effectiveness of controls relating to management’s determination of the net realizable value of finished goods and work in process inventories.

These procedures also included, among others (i) testing management's process for determining the net realizable value of finished goods and work in process inventories;

1 unchanged sentence

(iii) testing the completeness and accuracy of underlying data used in determining the net realizable value;

and (iv) evaluating the reasonableness of management's significant assumptions related to future average selling prices and future cost per part.

Evaluating management's assumption related to future average selling prices for certain products involved evaluating whether the assumption used by management was reasonable considering (i) current and past results, including recent sales;

(ii) the consistency with external market, industry data or current contract prices;

(iii) a comparison of the prior year estimates to actual results in the current fiscal year;

and (iv) evaluating the reasonableness of management's significant assumption related to future average selling prices.

Evaluating management's assumption related to future average selling prices involved considering (i) current and past sales (ii) the consistency with external market and industry data;

(iii) a comparison of the prior year estimates to actual average selling prices in the current fiscal year;

and (iv) whether the assumption was consistent with evidence obtained in other areas of the audit.

Evaluating management's assumption related to future cost per part for certain products involved evaluating whether the assumption used by management was reasonable considering (i) current and past results;

(ii) a comparison of the prior year estimates to actual results in the current fiscal year;

and (iii) whether the assumption was consistent with evidence obtained in other areas of the audit.

/s/ PricewaterhouseCoopers LLP

2 unchanged sentences

We have served as the Company’s auditor since 1984.

93 | 2023 10-K

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data