LEHI (Reuters) – Micron Technology said Tuesday it will put a chip factory in Lehi, Utah, up for sale as it stops making a type of memory chip it co-developed with Intel nearly a decade ago.
Lehi is Micron’s only Idaho factory to make 3D Xpoint memory, a form of memory chip that aimed to find a price-performance ratio between the two dominant forms of memory chip: DRAM, which is fast but pricey, and NAND, which slower but cheaper. The plant will be sold in a transaction expected to close by the end of this year, company officials told Reuters.
Micron introduced its first products based on the technology in 2019 with a set of solid-state drives aimed at data center customers. Sumit Sadana, Micron’s chief business officer, told Reuters in an interview that they received a lukewarm response from customers because they had to rewrite large chunks of their software to take advantage of the new type of memory.
Low demand means Micron cannot scale production to a volume high enough to justify the cost of further developing the chips, Sadana said. He said the plant’s underutilisation is expected to cost Micron $ 400 million this year.
After exiting the 3D Xpoint market, Micron plans to shift its development efforts to take advantage of a new, faster industry standard for connecting memory chips to computer chips called Compute Express Link.
“We will have a (return) on this new investment that will be much higher because it will be easier for the software ecosystem to adopt,” Sadana said.
Micron has developed the 3D Xpoint memory together with Intel since 2012. The company currently has a supply agreement with Intel that runs until the end of this year. Intel has said it plans to develop future generations of the chips, for which it uses a different brand name, called “Optane,” at one of its plants in New Mexico.
Sadana said Micron retains all intellectual property associated with 3D Xpoint but is in contact with multiple potential buyers for the factory. While he couldn’t name the parties or how much the factory could sell for, he said the bidders could go beyond memory companies and include computer chip makers, analog chips, or chip contract manufacturers.
“Now is a good time to have such an asset, because several companies are just being tapped into from a supply capacity standpoint,” Sadana said.
(Reporting by Stephen Nellis in San Francisco, Editing by Alexandra Hudson)
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