Microsoft Excel LibreOffice Calc

Micron Technology Inc. (MU)

Analysis of Income Taxes

Advanced level

Income Tax Expense (Benefit)

Micron Technology Inc., income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
U.S. federal 36  54  —  —  (6) 3 
State 2  (1) 1  1  1  2 
Foreign 319  374  152  27  93  46 
Current 357  427  153  28  88  51 
U.S. federal 146  (232) —  (39) (15) (4)
State (91) (101) —  (2) (1) — 
Foreign 281  74  (39) 32  85  81 
Deferred 336  (259) (39) (9) 69  77 
Income tax provision (benefit) 693  168  114  19  157  128 

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Item Description The company
Current Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Micron Technology Inc.’s current increased from 2017 to 2018 but then slightly decreased from 2018 to 2019.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Micron Technology Inc.’s deferred decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.
Income tax provision (benefit) Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Micron Technology Inc.’s income tax provision (benefit) increased from 2017 to 2018 and from 2018 to 2019.

Effective Income Tax Rate (EITR)

Micron Technology Inc., effective income tax rate (EITR) reconciliation

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
U.S. federal income tax statutory rate 21.00% 25.70% 35.00% 35.00% 35.00% 35.00%
Foreign tax rate differential -14.10% -18.20% -30.80% -106.80% 0.00% 0.00%
U.S. tax on foreign operations 4.60% 0.10% 0.70% 0.00% 0.00% 0.00%
Change in valuation allowance 0.60% -14.50% -1.20% 22.40% 0.00% 0.00%
State taxes, net of federal benefit -1.40% 0.60% 0.00% 0.00% 0.00% 0.00%
Research and development tax credits -1.70% -0.60% -1.30% 17.10% 0.00% 0.00%
Other 0.70% -0.50% -0.20% 25.50% -28.98% -30.32%
Effective income tax rate, before the Tax Act 9.70% -7.40% 2.20% -6.80% 6.02% 4.68%
Repatriation Tax related to the Tax Act 0.10% 7.30% 0.00% 0.00% 0.00% 0.00%
Remeasurement of deferred tax assets and liabilities related to the Tax Act 0.00% 1.30% 0.00% 0.00% 0.00% 0.00%
Effective income tax rate 9.80% 1.20% 2.20% -6.80% 6.02% 4.68%

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Item Description The company
Effective income tax rate, before the Tax Act Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Micron Technology Inc.’s effective income tax rate, before the Tax Act decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.

Components of Deferred Tax Assets and Liabilities

Micron Technology Inc., components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
Net operating loss and tax credit carryforwards 1,045  1,417  3,426  3,014  2,869  3,162 
Accrued salaries, wages, and benefits 122  163  211  142  143  152 
Property, plant, and equipment 80  —  —  —  —  284 
Other 110  115  145  141  183  217 
Gross deferred tax assets 1,357  1,695  3,782  3,297  3,195  3,815 
Valuation allowance (277) (228) (2,321) (2,107) (2,051) (2,443)
Deferred tax assets, net of valuation allowance 1,080  1,467  1,461  1,190  1,144  1,372 
Product and process technology (138) (62) (85) (81) (43) (29)
Property, plant, and equipment —  (173) (300) (135) (2) — 
Other (109) (213) (327) (319) (424) (473)
Deferred tax liabilities (247) (448) (712) (535) (469) (502)
Net deferred tax assets (liabilities) 833  1,019  749  655  675  870 

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Item Description The company
Gross deferred tax assets Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Micron Technology Inc.’s gross deferred tax assets decreased from 2017 to 2018 and from 2018 to 2019.
Deferred tax assets, net of valuation allowance Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Micron Technology Inc.’s deferred tax assets, net of valuation allowance increased from 2017 to 2018 but then decreased significantly from 2018 to 2019.
Net deferred tax assets (liabilities) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Micron Technology Inc.’s net deferred tax assets (liabilities) increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.

Deferred Tax Assets and Liabilities, Classification

Micron Technology Inc., deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
Current deferred tax assets (included in Other current assets) —  —  —  —  104  228 
Deferred tax assets 837  1,022  766  657  597  816 
Current deferred tax liabilities (included in Accounts payable and accrued expenses) —  —  —  —  4  4 
Deferred tax liabilities (included in Other noncurrent liabilities) 4  3  17  2  22  170 

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Item Description The company
Deferred tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Micron Technology Inc.’s deferred tax assets increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.
Deferred tax liabilities (included in Other noncurrent liabilities) Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Micron Technology Inc.’s deferred tax liabilities (included in Other noncurrent liabilities) decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.

Adjustments to Financial Statements: Removal of Deferred Taxes

Micron Technology Inc., adjustments to financial statements

US$ in millions

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
Adjustment to Current Assets
Current assets (as reported) 16,503  16,039  12,457  9,495  8,596  10,245 
Less: Current deferred tax assets, net —  —  —  —  104  228 
Current assets (adjusted) 16,503  16,039  12,457  9,495  8,492  10,017 
Adjustment to Total Assets
Total assets (as reported) 48,887  43,376  35,336  27,540  24,143  22,498 
Less: Current deferred tax assets, net —  —  —  —  104  228 
Less: Noncurrent deferred tax assets, net 837  1,022  766  657  597  816 
Total assets (adjusted) 48,050  42,354  34,570  26,883  23,442  21,454 
Adjustment to Current Liabilities
Current liabilities (as reported) 6,390  5,754  5,334  4,835  3,905  4,811 
Less: Current deferred tax liabilities, net —  —  —  —  4  4 
Current liabilities (adjusted) 6,390  5,754  5,334  4,835  3,901  4,807 
Adjustment to Total Liabilities
Total liabilities (as reported) 12,019  10,112  15,845  14,612  10,855  10,868 
Less: Current deferred tax liabilities, net —  —  —  —  4  4 
Less: Noncurrent deferred tax liabilities, net 4  3  17  2  22  170 
Total liabilities (adjusted) 12,015  10,109  15,828  14,610  10,829  10,694 
Adjustment to Total Micron Shareholders’ Equity
Total Micron shareholders’ equity (as reported) 35,881  32,294  18,621  12,080  12,302  10,771 
Less: Net deferred tax assets (liabilities) 833  1,019  749  655  675  870 
Total Micron shareholders’ equity (adjusted) 35,048  31,275  17,872  11,425  11,627  9,901 
Adjustment to Net Income (loss) Attributable To Micron
Net income (loss) attributable to Micron (as reported) 6,313  14,135  5,089  (276) 2,899  3,045 
Add: Deferred income tax expense (benefit) 336  (259) (39) (9) 69  77 
Net income (loss) attributable to Micron (adjusted) 6,649  13,876  5,050  (285) 2,968  3,122 

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Micron Technology Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Micron Technology Inc., adjusted financial ratios

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
Current Ratio
Reported current ratio 2.58 2.79 2.34 1.96 2.20 2.13
Adjusted current ratio 2.58 2.79 2.34 1.96 2.18 2.08
Net Profit Margin
Reported net profit margin 26.97% 46.51% 25.04% -2.23% 17.90% 18.61%
Adjusted net profit margin 28.41% 45.66% 24.85% -2.30% 18.33% 19.09%
Total Asset Turnover
Reported total asset turnover 0.48 0.70 0.58 0.45 0.67 0.73
Adjusted total asset turnover 0.49 0.72 0.59 0.46 0.69 0.76
Financial Leverage
Reported financial leverage 1.36 1.34 1.90 2.28 1.96 2.09
Adjusted financial leverage 1.37 1.35 1.93 2.35 2.02 2.17
Return on Equity (ROE)
Reported ROE 17.59% 43.77% 27.33% -2.28% 23.57% 28.27%
Adjusted ROE 18.97% 44.37% 28.26% -2.49% 25.53% 31.53%
Return on Assets (ROA)
Reported ROA 12.91% 32.59% 14.40% -1.00% 12.01% 13.53%
Adjusted ROA 13.84% 32.76% 14.61% -1.06% 12.66% 14.55%

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

Financial ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Micron Technology Inc.’s adjusted current ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Micron Technology Inc.’s adjusted net profit margin ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019 not reaching 2017 level.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Micron Technology Inc.’s adjusted total asset turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Micron Technology Inc.’s adjusted financial leverage ratio decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Micron Technology Inc.’s adjusted ROE improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Micron Technology Inc.’s adjusted ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Micron Technology Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Current Ratio

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Current assets 16,503  16,039  12,457  9,495  8,596  10,245 
Current liabilities 6,390  5,754  5,334  4,835  3,905  4,811 
Liquidity Ratio
Current ratio1 2.58 2.79 2.34 1.96 2.20 2.13
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted current assets 16,503  16,039  12,457  9,495  8,492  10,017 
Adjusted current liabilities 6,390  5,754  5,334  4,835  3,901  4,807 
Liquidity Ratio
Adjusted current ratio2 2.58 2.79 2.34 1.96 2.18 2.08

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 Current ratio = Current assets ÷ Current liabilities
= 16,503 ÷ 6,390 = 2.58

2 Adjusted current ratio = Adjusted current assets ÷ Adjusted current liabilities
= 16,503 ÷ 6,390 = 2.58

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Micron Technology Inc.’s adjusted current ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

Adjusted Net Profit Margin

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Micron 6,313  14,135  5,089  (276) 2,899  3,045 
Revenue 23,406  30,391  20,322  12,399  16,192  16,358 
Profitability Ratio
Net profit margin1 26.97% 46.51% 25.04% -2.23% 17.90% 18.61%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Micron 6,649  13,876  5,050  (285) 2,968  3,122 
Revenue 23,406  30,391  20,322  12,399  16,192  16,358 
Profitability Ratio
Adjusted net profit margin2 28.41% 45.66% 24.85% -2.30% 18.33% 19.09%

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 Net profit margin = 100 × Net income (loss) attributable to Micron ÷ Revenue
= 100 × 6,313 ÷ 23,406 = 26.97%

2 Adjusted net profit margin = 100 × Adjusted net income (loss) attributable to Micron ÷ Revenue
= 100 × 6,649 ÷ 23,406 = 28.41%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Micron Technology Inc.’s adjusted net profit margin ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019 not reaching 2017 level.

Adjusted Total Asset Turnover

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Revenue 23,406  30,391  20,322  12,399  16,192  16,358 
Total assets 48,887  43,376  35,336  27,540  24,143  22,498 
Activity Ratio
Total asset turnover1 0.48 0.70 0.58 0.45 0.67 0.73
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Revenue 23,406  30,391  20,322  12,399  16,192  16,358 
Adjusted total assets 48,050  42,354  34,570  26,883  23,442  21,454 
Activity Ratio
Adjusted total asset turnover2 0.49 0.72 0.59 0.46 0.69 0.76

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 Total asset turnover = Revenue ÷ Total assets
= 23,406 ÷ 48,887 = 0.48

2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 23,406 ÷ 48,050 = 0.49

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Micron Technology Inc.’s adjusted total asset turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Adjusted Financial Leverage

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Total assets 48,887  43,376  35,336  27,540  24,143  22,498 
Total Micron shareholders’ equity 35,881  32,294  18,621  12,080  12,302  10,771 
Solvency Ratio
Financial leverage1 1.36 1.34 1.90 2.28 1.96 2.09
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets 48,050  42,354  34,570  26,883  23,442  21,454 
Adjusted total Micron shareholders’ equity 35,048  31,275  17,872  11,425  11,627  9,901 
Solvency Ratio
Adjusted financial leverage2 1.37 1.35 1.93 2.35 2.02 2.17

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 Financial leverage = Total assets ÷ Total Micron shareholders’ equity
= 48,887 ÷ 35,881 = 1.36

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Micron shareholders’ equity
= 48,050 ÷ 35,048 = 1.37

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Micron Technology Inc.’s adjusted financial leverage ratio decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.

Adjusted Return on Equity (ROE)

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Micron 6,313  14,135  5,089  (276) 2,899  3,045 
Total Micron shareholders’ equity 35,881  32,294  18,621  12,080  12,302  10,771 
Profitability Ratio
ROE1 17.59% 43.77% 27.33% -2.28% 23.57% 28.27%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Micron 6,649  13,876  5,050  (285) 2,968  3,122 
Adjusted total Micron shareholders’ equity 35,048  31,275  17,872  11,425  11,627  9,901 
Profitability Ratio
Adjusted ROE2 18.97% 44.37% 28.26% -2.49% 25.53% 31.53%

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 ROE = 100 × Net income (loss) attributable to Micron ÷ Total Micron shareholders’ equity
= 100 × 6,313 ÷ 35,881 = 17.59%

2 Adjusted ROE = 100 × Adjusted net income (loss) attributable to Micron ÷ Adjusted total Micron shareholders’ equity
= 100 × 6,649 ÷ 35,048 = 18.97%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Micron Technology Inc.’s adjusted ROE improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Adjusted Return on Assets (ROA)

Microsoft Excel LibreOffice Calc
Aug 29, 2019 Aug 30, 2018 Aug 31, 2017 Sep 1, 2016 Sep 3, 2015 Aug 28, 2014
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Micron 6,313  14,135  5,089  (276) 2,899  3,045 
Total assets 48,887  43,376  35,336  27,540  24,143  22,498 
Profitability Ratio
ROA1 12.91% 32.59% 14.40% -1.00% 12.01% 13.53%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Micron 6,649  13,876  5,050  (285) 2,968  3,122 
Adjusted total assets 48,050  42,354  34,570  26,883  23,442  21,454 
Profitability Ratio
Adjusted ROA2 13.84% 32.76% 14.61% -1.06% 12.66% 14.55%

Based on: 10-K (filing date: 2019-10-17), 10-K (filing date: 2018-10-15), 10-K (filing date: 2017-10-26), 10-K (filing date: 2016-10-28), 10-K (filing date: 2015-10-27), 10-K (filing date: 2014-10-27).

2019 Calculations

1 ROA = 100 × Net income (loss) attributable to Micron ÷ Total assets
= 100 × 6,313 ÷ 48,887 = 12.91%

2 Adjusted ROA = 100 × Adjusted net income (loss) attributable to Micron ÷ Adjusted total assets
= 100 × 6,649 ÷ 48,050 = 13.84%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Micron Technology Inc.’s adjusted ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.