Microchip Technology Inc. (MCHP) develops, manufactures, and sells smart, connected, and secure embedded control solutions used in a wide variety of applications . The company's strategic focus includes general-purpose and specialized 8-bit, 16-bit, and 32-bit mixed-signal microcontrollers, microprocessors, analog, FPGA, and memory products . These products are part of their Total System Solution (TSS), which combines hardware, software, and services to help customers increase revenue, reduce costs, and manage risks .
- Mixed-Signal Microcontrollers - Develops and sells 8-bit, 16-bit, and 32-bit microcontrollers, forming the largest component of the company's semiconductor products segment.
- Analog Products - Offers a range of analog solutions that are integral to the company's semiconductor offerings.
- Other Products and Services - Includes FPGA products, memory products, and manufacturing services, contributing to the semiconductor products segment.
- Technology Licensing - Provides technology licensing services as a separate business segment.
You might also like
| Name | Position | External Roles | Short Bio | |
|---|---|---|---|---|
Steve Sanghi ExecutiveBoard | Interim CEO and President | Board Chair at Impinj, Inc. | Steve Sanghi has a long history with MCHP, having served as CEO from 1991 to 2021. He was appointed interim CEO and President in November 2024. | View Report → |
J. Eric Bjornholt Executive | Senior Vice President and CFO | None | J. Eric Bjornholt joined MCHP in 1995 and became CFO in January 2009. He was promoted to Senior Vice President in 2019. | |
Richard J. Simoncic Executive | Chief Operating Officer | None | Richard J. Simoncic joined MCHP in 1990 and became COO in April 2024. He has held various leadership roles in the Analog Power and Interface Business Units. | |
Ellen L. Barker Board | Board Member | None | Ellen L. Barker joined the MCHP Board in February 2024. She has extensive experience in technology and finance, having held senior roles at Texas Instruments. | |
Karen M. Rapp Board | Director | Board Member at Plexus Corp. | Karen M. Rapp has been a director since January 2021. She has held senior roles at National Instruments and NXP Semiconductors. | |
Karlton D. Johnson Board | Director | CEO of DeLaine Strategy Group LLC, CEO of National Space Society | Karlton D. Johnson has served as a director since April 2021. He is known for his expertise in strategic leadership and cybersecurity. | |
Matthew W. Chapman Board | Director, Chair of the Audit Committee | None | Matthew W. Chapman has been a director since 1997 and is recognized as an audit committee financial expert. | |
Robert A. Rango Board | Director | Board Member at KLA Corporation and Keysight Technologies, Inc. | Robert A. Rango joined the MCHP Board in January 2023. He has significant executive experience in the technology industry. | |
Victor Peng Board | Director | None | Victor Peng was appointed to the MCHP Board in February 2025. He previously served as president of AMD. |
- Given the prolonged reliance on high turns business due to customer uncertainty and short lead times, what specific actions is Microchip taking to encourage customers to place longer-term orders to improve visibility into future demand?
- With the downturn being deeper and longer than anticipated, how is Microchip managing the risks of significant inventory write-downs or the need for restructuring, and can you assure investors that the dividend will be maintained without impacting the company's long-term financial health?
- As competitors report low to mid-single-digit pricing declines for 2025, how does Microchip plan to adjust its pricing strategy to stay competitive without eroding profit margins, particularly amidst aggressive pricing in new design wins?
- Underutilization charges and elevated inventory reserves are significantly impacting gross margins; what are your plans to mitigate these pressures, and at what revenue levels do you anticipate gross margins returning to historical norms?
- You mentioned challenges in quantifying the success of your Total System Solutions strategy across your extensive customer base; how can investors evaluate the tangible impact of TSS on revenue growth and increased customer content going forward?
Research analysts who have asked questions during MICROCHIP TECHNOLOGY earnings calls.
Blayne Curtis
Jefferies Financial Group
7 questions for MCHP
Harsh Kumar
Piper Sandler & Co.
7 questions for MCHP
Vivek Arya
Bank of America Corporation
7 questions for MCHP
Harlan Sur
JPMorgan Chase & Co.
6 questions for MCHP
Joshua Buchalter
TD Cowen
6 questions for MCHP
William Stein
Truist Securities
6 questions for MCHP
Tore Svanberg
Stifel Financial Corp.
5 questions for MCHP
Chris Caso
Wolfe Research LLC
4 questions for MCHP
Christopher Rolland
Susquehanna Financial Group
4 questions for MCHP
Janet Ramkissoon
Quadra Capital
4 questions for MCHP
Timothy Arcuri
UBS
4 questions for MCHP
Vijay Rakesh
Mizuho
4 questions for MCHP
Christopher Caso
Wolfe Research
3 questions for MCHP
Christopher Danely
Citigroup Inc.
3 questions for MCHP
Quinn Bolton
Needham & Company, LLC
3 questions for MCHP
Chris Danely
Citi
2 questions for MCHP
Chris Stanley
Citi
2 questions for MCHP
Craig Ellis
B. Riley Securities
2 questions for MCHP
James Schneider
Goldman Sachs
2 questions for MCHP
Joseph Moore
Morgan Stanley
2 questions for MCHP
Tim Arcuri
UBS
2 questions for MCHP
Toshiya Hari
Goldman Sachs Group, Inc.
2 questions for MCHP
Joe Moore
Morgan Stanley
1 question for MCHP
Joe Quatrochi
Wells Fargo
1 question for MCHP
Joe Quatroci
Wells Fargo
1 question for MCHP
| Customer | Relationship | Segment | Details |
|---|---|---|---|
Arrow Electronics | Distributor | All | 13% of accounts receivable as of March 31, 2024 ; 10% of net sales in FY 2025 ; 12% of net sales in FY 2024 ; 11% of net sales in FY 2023. |
Notable M&A activity and strategic investments in the past 3 years.
| Company | Year | Details |
|---|---|---|
VSI | 2024 | Microchip Technology's acquisition of VSI in April 2024 enhanced its automotive networking portfolio by incorporating VSI’s advanced ADAS and digital cockpit connectivity solutions, including the ASA Motionlink technology, to support next-generation software-defined vehicles. |
Neuronix AI Labs | 2024 | Completed in April 2024, the acquisition of Neuronix AI Labs strengthened Microchip’s edge AI capabilities by integrating neural network sparsity optimization technology that reduces power, size, and computational needs for tasks like image classification and object detection, aligning with its focus on low-power AI solutions for IoT and FPGA applications. |
Microsemi | 2018 | Finalized on May 29, 2018, this deal involved a total consideration of approximately $8.25 billion using a detailed mix of cash, secured borrowings, and other financing, aimed at broadening Microchip’s product portfolio for aerospace, defense, communications, data centers, and industrial markets, with subsequent integration of Microsemi as a wholly owned subsidiary. |
Recent press releases and 8-K filings for MCHP.
- 6% sequential sales growth to $1,140.4 M, driven by 9.7% MCU and 1.7% analog growth; non-GAAP gross margin 56.7% after $122.8 M in inventory write-offs and underutilization charges (10.8 ppt impact).
- Data center segment saw a rebound in Gen 4/5 product sales and introduced the industry’s first 3 nm PCIe Gen 6 switch now sampling with hyperscalers.
- Inventory reduced by $73.8 M QoQ (199 days on hand) and $261 M YTD, though underutilization and write-off charges remain elevated.
- Agreed to sell Fab 2 in Tempe as part of wafer fab restructuring, targeting $90 M in annual cash savings and removing underutilized capacity.
- Q3 guidance calls for a seasonally weakest quarter, down low-mid single digits; bookings were 10% higher QoQ with a book-to-bill of 1.06 as distributors and customers replenish inventories.
- Net sales were $1.14 billion (+6% sequentially); non-GAAP gross margin of 56.7% and diluted EPS of $0.35 in Q2 FY2026.
- Inventory reduced by $73.8 million to 199 days; recorded $71.8 million of inventory write-offs and $51 million of underutilization charges.
- Launched the industry’s first 3 nanometer PCIe Gen 6 switch on October 13; sampling underway with production ramp targeted for June 2026.
- For Q3 FY2026, guidance is $1.129 billion ± $20 million in net sales, 57.2–59.2% non-GAAP gross margin, and EPS of $0.34–$0.40.
- Entered an agreement to sell the Fab 2 wafer fabrication facility in Tempe as part of wafer fab restructuring.
- Net sales in Q2 were $1.14 billion, up 6% sequentially, driven by growth in both MCU and analog businesses and a recovery in Gen 4/5 data center products.
- Non-GAAP gross margin rose 236 bps sequentially to 56.7%, despite $122.8 million of combined inventory reserve ($71.8 M) and underutilization ($51 M) charges.
- Inventory declined by $73.8 million to $1.095 billion, reducing inventory days to 199.
- For Q3 FY2026 (Dec), guidance calls for net sales of ±$20 million (–1% sequential at midpoint), non-GAAP gross margin of 57.2%–59.2%, and non-GAAP EPS of $0.34–$0.40.
- Announced the industry’s first 3 nm PCIe Gen 6 switch on October 13; products are sampling now with production slated for June 2026 and volume ramp late 2026.
- Microchip reported Q2 FY2026 net sales of $1.140 billion, up 6.0% sequentially and down 2.0% year-over-year.
- On a GAAP basis, the company posted gross margin of 55.9%, operating income of $88.9 million (7.8% of sales), and net income attributable to common shareholders of $13.9 million ($0.03 EPS).
- Non-GAAP results showed gross margin of 56.7%, operating income of $277.2 million (24.3% of sales), and net income of $199.1 million ($0.35 EPS).
- The Board declared a quarterly dividend of $0.455 per share, payable December 9, 2025.
- Issued Q3 FY2026 guidance: net sales of $1.109–$1.149 billion; GAAP EPS of $(0.02)–$0.02; non-GAAP EPS of $0.34–$0.40.
- Net sales of $1.140 billion, above the guidance midpoint of $1.130 billion, grew 6.0% sequentially and declined 2.0% year-over-year.
- On a GAAP basis, gross profit was 55.9%, operating income was $88.9 million (7.8% of sales) and EPS was $0.03; on a Non-GAAP basis, gross profit was 56.7%, operating income was $277.2 million (24.3%) and EPS was $0.35.
- Declared a quarterly cash dividend of $0.455 per common share, payable December 9, 2025.
- Third quarter guidance: net sales of $1.109–$1.149 billion and Non-GAAP EPS of $0.34–$0.40.
- Launched the industry’s first 3 nm PCIe Gen 6 switch for AI and enterprise data center applications.
- Microchip launched the industry’s first PCIe Gen 6 switch built on a 3 nm process, delivering up to 64 GT/s per lane and supporting up to 160 lanes for AI and HPC workloads.
- The Switchtec Gen 6 family offers lower power consumption, hardware root of trust, secure boot, and post-quantum safe cryptography for enhanced security.
- Each switch provides 20 ports, 10 stacks, NTB support, an integrated MIPS processor, and comprehensive diagnostics via ChipLink tools.
- Switchtec Gen 6 PCIe switches are available for sampling to qualified customers through Microchip representatives and distributors.
- Microchip introduced a new portfolio of GNSS Disciplined Oscillator (GNSSDO) modules integrating advanced atomic clock (CSAC, MAC) and oscillator (OCXO) technologies for aerospace and defense PNT applications.
- The GNSSDO modules include integrated 32-bit microcontrollers and SmartFusion 2 FPGAs, enabling programmable flexibility and control via a common serial protocol and GUI.
- The flagship MD-013 ULTRA CLEAN module supports GPS, Galileo, BeiDou, and NavIC, delivers ultra-low phase noise (−119 dBc/Hz at 1 Hz offset), and outputs 1 PPS TTL plus 10 MHz sine and square wave signals.
- Despite a recent net loss, the product launch helped lift Microchip’s stock by 15% over the last quarter, with analysts projecting 13.4% annual revenue growth driven by defense demand.
- Bookings in Q2 improved with a June book-to-bill ratio above 1 and July bookings the highest in three years, driving 10.8% sequential revenue growth, and Q3 guidance of +5.1% due to limited visibility amid high inventory and short lead times.
- Distribution inventory differential fell from $103 M in March to $49 M in June and distribution sell-through rose for the first time in eight quarters, signaling normalization of channel inventories though direct customer levels remain hard to quantify.
- Aerospace & Defense (~18% of sales) remains the strongest end market, data center demand is rebounding, industrial is mixed, and automotive lags.
- Gross margin was 54% in Q2 and is guided to 56% in Q3; inventory reserve charges are expected to drop from $77 M to ~$20 M (adding ~5 pp to margin), with underutilization charges easing over time toward a 65% long-term target.
- Microchip delivered 10.8% sequential net sales growth to $1.075 B with non-GAAP gross margin of 54.3% and non-GAAP operating margin up 670 bps in Q1 FY2026.
- Inventory declined by $124.4 M sequentially, reducing days on hand to 214 days, with a target of 195–200 days in Q2.
- The company cited a “trifecta” of structural demand recovery—distribution sell-in catching up to sell-through and direct customer inventory correction—driving broad-based growth.
- Q2 FY2026 guidance: net sales of $1.13 B ± $20 M, non-GAAP gross margin 55–57%, non-GAAP operating expenses 32.4–32.8%, and non-GAAP EPS $0.30–$0.36.
- With adjusted free cash flow expected to exceed dividends after Q2, Microchip plans to fund payouts without new debt and prioritize debt reduction thereafter.
- Microchip reported improved order trends with a book-to-bill ratio above 1.07 in Q1 and peak May bookings, indicating strong demand across multiple end markets.
- The company is maintaining a 60/40 foundry versus in-house manufacturing split while increasing in-house assembly & testing, and diversifying its portfolio with innovations in FPGA, PCIe retimers, and advanced microcontrollers including a 64-bit space computer initiative.
- Recent acquisitions like TF Semiconductor for high-voltage drivers, along with strengthened customer relationships and a focus on export markets, underline Microchip’s broader strategy to support growth and mitigate domestic competition in China.