Crucial 2011 Annual Report Download - page 21

If our manufacturing process is disrupted, our business, results of operations or financial condition could be materially adversely
affected.
We manufacture products using highly complex processes that require technologically advanced equipment and continuous modification to
improve yields and performance. Difficulties in the manufacturing process or the effects from a shift in product mix can reduce yields or disrupt
production and may increase our per gigabit manufacturing costs. Additionally, our control over operations at our IM Flash, Inotera, MP Mask and
Transform joint ventures is limited by our agreements with our partners. From time to time, we have experienced disruptions in our manufacturing
process as a result of power outages, improperly functioning equipment and equipment failures. If production at a fabrication facility is disrupted
for any reason, manufacturing yields may be adversely affected or we may be unable to meet our customers' requirements and they may purchase
products from other suppliers. This could result in a significant increase in manufacturing costs or loss of revenues or damage to customer
relationships, which could materially adversely affect our business, results of operations or financial condition.
We may incur additional material restructure charges in future periods.
In response to a severe downturn in the semiconductor memory industry and global economic conditions, we implemented restructure
initiatives that resulted in net charges of $70 million in 2009 and $33 million in 2008. We may need to implement further restructure initiatives in
future periods. As a result of these initiatives, we could incur restructure charges, lose production output, lose key personnel and experience
disruptions in our operations and difficulties in delivering products timely.
Consolidation of industry participants and governmental assistance to some of our competitors may contribute to uncertainty in the
semiconductor memory industry and negatively impact our ability to compete.
In recent years, supply of memory products has significantly exceeded customer demand resulting in significant declines in average selling
prices of DRAM, NAND Flash and NOR Flash products and substantial operating losses by us and our competitors. The operating losses as well
as limited access to sources of financing have led to the deterioration in the financial condition of a number of industry participants. Some of our
competitors may try to enhance their capacity and lower their cost structure through consolidation. In addition, some governments have provided,
or are considering providing, significant financial assistance to some of our competitors. Consolidation of industry competitors could put us at a
competitive disadvantage.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
Our corporate headquarters are located in Boise, Idaho. The following is a summary of our principal facilities as of September 1, 2011:
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Location
Principal Operations
Boise, Idaho R&D including wafer fabrication and reticle manufacturing
Lehi, Utah Wafer fabrication
Manassas, Virginia Wafer fabrication
Singapore Three wafer fabrication facilities and a test, assembly and module assembly facility
Avezzano, Italy Wafer fabrication
Nampa, Idaho Test
Aguadilla, Puerto Rico Module assembly and test
Xi’an, China Test
Qiryat Gat, Israel Wafer fabrication
Muar, Malaysia Module assembly and test
Agrate, Italy R&D including wafer fabrication