U.S. chipmaker Micron Technology Inc posted a narrower-than-expected quarterly loss on Tuesday due to improved demand for memory chips, boosting its shares 3.2 percent.

Micron, which makes memory chips used in computers, cell phones and digital music players such as Apple Inc's iPods, reported a net loss in the fourth quarter ended Sept. 3 of $88 million, or 10 cents per share, compared with a net loss of $344 million, or 45 cents per share, a year earlier.

That was better than a loss of 18 cents a share expected on average by analysts, according to Reuters Estimates.

Revenue fell 10.1 percent to $1.3 billion from $1.45 billion a year ago, and was slightly above the $1.28 billion analysts polled by Reuters Estimates had expected.

Micron's competitors include Samsung Electronics Co Ltd and Hynix Semiconductor Inc.

Shares in the Boise, Idaho-based company rose 27 cents to $8.67 after the earnings report, after closing down 4 cents, or 0.5 percent, at $8.40 on the New York Stock Exchange.

(Reporting by Clare Baldwin and Ian Sherr; Editing by Gary Hill)