SAN FRANCISCO -- Micron ( MU) reported a steeper-than-expected loss in its fiscal fourth quarter, as decreasing demand for memory chips and an inventory writedown battered its business.

And as the tech industry enters what is traditionally its strongest time of year, Micron executives signaled a grim Christmas sales season for all players in the PC business.

Asked about Micron's outlook for fourth-quarter PC sales during a conference call with analysts Wednesday, sales chief Mark Adams said the company expects overall PC growth to be flat to up a few percentage points year-over-year, instead of a previous expectation of roughly 10% growth.

The comments are among the most pointedly pessimistic views of holiday demand for PCs since the credit crunch reached crisis levels in recent weeks with the collapse of some of the world's major financial firms. Last month, Dell ( DELL) , the world's No.2 PC maker, said that "continued conservatism" in U.S. tech spending has spread to Western Europe and Asia, but did not offer a specific view on holiday demand.

Virtually all of the major firms involved in the PC industry, including Intel ( INTC) and Hewlett-Packard ( HPQ), are down significantly from their 52-week highs.

Shares of Micron were down 4.4%, or 19 cents at $4.11 in extended trading Wednesday.

For makers of memory chips like Micron, crumbling demand for PCs means an extra heap of misery on top of a market already plagued by a severe oversupply and plummeting prices for its products.

Micron posted a loss of $344 million, or 45 cents a share, in the three months ended Aug. 28 -- the company's seventh consecutive quarter of red ink.

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