Common-Size Income Statement
Micron Technology Inc., common-size consolidated income statement
Based on: 10-K (reporting date: 2026-09-03), 10-K (reporting date: 2025-08-28), 10-K (reporting date: 2024-08-29), 10-K (reporting date: 2023-08-31), 10-K (reporting date: 2022-09-01), 10-K (reporting date: 2021-09-02).
The financial performance exhibits a cyclical pattern characterized by a severe contraction in 2023 followed by a period of aggressive recovery and expansion through 2026. Profitability metrics show extreme volatility, shifting from healthy margins to significant losses and eventually reaching peak efficiency levels.
- Gross Profitability and Cost of Goods Sold
- A dramatic fluctuation in the cost of goods sold is observed, peaking in 2023 at 109.11% of revenue, which resulted in a negative gross margin of -9.11%. This indicates a period where production and inventory costs exceeded total sales. However, a consistent recovery followed, with the cost of goods sold dropping to 19.28% by 2026, driving the gross margin to a high of 80.72%.
- Operating Expense Trends
- Research and development (R&D) and selling, general, and administrative (SG&A) expenses as a percentage of revenue peaked during the 2023 downturn, reaching 20.04% and 5.92% respectively. This suggests a high proportion of fixed costs relative to declining revenues. In the subsequent recovery period, these ratios declined sharply, with R&D falling to 4.24% and SG&A to 1.46% by 2026, indicating significant operating leverage as revenue scaled.
- Operating and Net Income Stability
- Operating income mirrored the volatility of gross margins, crashing to -36.97% in 2023 before rebounding to 74.59% in 2026. Net income followed a similar trajectory, moving from a deep deficit of -37.54% in 2023 to a peak of 63.80% in 2026. The recovery is marked by an acceleration in margin expansion that exceeds the initial profitability levels seen in 2021 and 2022.
- Non-Operating Items and Taxation
- Interest income peaked at 3.01% of revenue in 2023, coinciding with the period of lowest operational profitability, which suggests a reliance on cash reserves or higher interest rate environments during the slump. The income tax provision increased proportionally with profitability, rising from 1.14% in 2023 to 11.08% in 2026, reflecting the substantial increase in taxable income.
The overall trend indicates a transition from a high-cost, low-revenue environment in 2023 to a highly optimized operational state by 2026. The precipitous decline in both COGS and operating expenses as a percentage of revenue suggests a powerful combination of price recovery and increased production efficiency.
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