TLDR
- Micron Technology (MU) plans to halt server chip supplies to Chinese data centers after unsuccessful recovery from 2023 government ban
- The chipmaker will continue selling to Chinese automotive and mobile sectors, plus customers with global operations
- CEO Sanjay Mehrotra unloaded $5.13 million in stock across October 29-30 at prices ranging from $221.68 to $231.45
- The 18,586 share sale followed a pre-arranged Rule 10b5-1 trading plan established in August 2024
- Mehrotra currently holds 409,078 shares directly and 675,000 shares indirectly through family trusts
Micron Technology is walking away from China’s data center market. The company announced plans to stop supplying server chips after efforts to recover from Beijing’s 2023 ban fell flat.
October 17 reports confirmed the chipmaker’s withdrawal from Chinese data centers. Micron was Washington’s first semiconductor casualty in the escalating U.S.-China trade dispute.
Beijing banned Micron products in retaliation for American restrictions on Chinese tech companies. The ban effectively shut Micron out of a rapidly growing market.
China’s data center sector expanded without Micron’s participation. The company couldn’t overcome the government roadblock despite the market opportunity.
Selective China Strategy
The chipmaker isn’t completely pulling out of China. Micron will keep serving Chinese companies with operations abroad.
Automotive and mobile phone customers in China remain on the sales list. This selective approach preserves some revenue while acknowledging the data center defeat.
The company can still participate in key Chinese sectors. Just not in the lucrative server and data center space.
Insider Stock Transactions
CEO Sanjay Mehrotra recently trimmed his stock position. He sold $5.13 million worth of shares in late October.
The sales happened over two days. October 29 and 30 saw multiple transactions totaling 18,586 shares.
Share prices varied across the sales. The range spanned from $221.68 to $231.45 per share.
On October 29, Mehrotra sold 8,968 shares at $230.23 average and 2,930 shares at $231.45 average. October 30 brought six separate transactions at lower prices.
The CEO sold 527 shares at $221.68, 596 at $223.04, and 1,131 at $224.30. Additional sales included 3,225 shares at $225.05, 4,911 at $226.14, and 212 at $226.79.
Executive Holdings Update
A Rule 10b5-1 trading plan governed all transactions. Mehrotra set up this plan on August 8, 2024.
He also transferred 10,000 shares as a gift on October 29. His direct holdings now total 409,078 shares.
Indirect ownership adds another layer. Mehrotra controls 675,000 shares through grantor retained annuity trusts benefiting his family.
The timing aligns with Micron’s China market pivot. The CEO’s stock activity mirrors the company’s strategic shifts.
Micron’s China data center withdrawal closes a chapter that started with the 2023 ban. The company now focuses on market segments where it can still compete while Mehrotra’s October transactions reduced his direct stake by 18,586 shares.
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