Group 1 - The article does not provide any specific information or data regarding companies or industries [1]

Microchip Technology forecast third-quarter net sales below Wall Street estimates on Thursday, indicating tepid demand for its chips as customers in the automotive and industrial markets continue to c... ...

Core Insights - Microchip Technology met Wall Street's revenue expectations for Q3 CY2025, reporting sales of $1.14 billion, which represents a 2% year-on-year decline [1][7] - The company's revenue guidance for the next quarter is $1.13 billion, which is 4.3% below analysts' estimates [1][7] - Non-GAAP profit per share was $0.35, exceeding analysts' consensus estimates by 4.9% [1][7] Company Overview - Microchip Technology, established in 1987, is a leading provider of microcontrollers and integrated circuits, primarily serving the automotive sector, especially electric vehicles and their charging devices [4] Revenue Performance - The company has struggled with consistent demand over the past five years, experiencing a 4.2% annual decline in sales, indicating lower business quality [5] - In Q3 CY2025, net sales grew 6% sequentially, reflecting operational improvements despite a gradual market recovery [3] - The adjusted operating income for the quarter was $277.2 million, with a margin of 24.3%, surpassing analyst estimates [7] Financial Metrics - Revenue for Q3 CY2025 was $1.14 billion, aligning with analyst expectations, but down 2% year-on-year [7] - Adjusted EPS was $0.35, beating analyst estimates of $0.33 by 4.9% [7] - Operating margin decreased to 7.8% from 12.6% in the same quarter last year [7] - Free cash flow margin improved to 4.5%, up from 2% in the same quarter last year [7] - Inventory days outstanding decreased to 198 from 213 in the previous quarter [7] - The company's market capitalization stands at $32.81 billion [7]

Financial Performance - GAAP Revenue for Fiscal Second Quarter 2026 was $1,140.4 million, up 6.0% QoQ and down 2.0% YoY[17] - Gross Margin for Fiscal Second Quarter 2026 was 56.7%, increased by 236 basis points QoQ[17] - Operating Margin for Fiscal Second Quarter 2026 was 24.3%, increased by 364 basis points QoQ[17] - Diluted Earnings Per Share for Fiscal Second Quarter 2026 was $0.35, increased by 29.6% QoQ[17] - Adjusted Trailing Twelve Months (TTM) EBITDA was $1,102.9 million, representing 26.2% of TTM sales[17] - Adjusted Free Cash Flow was $38.3 million, representing 3.4% of net sales[17] Capital Allocation - The company paid $245.8 million in common dividends[17] - The company announced a common stock dividend of 45.5 cents per share for Q3FY26[17] - The company has reduced debt 24 out of the last 29 quarters[46] - The company has paid dividends for 92 consecutive quarters[46]

Financial Performance - Net sales for the three months ended September 30, 2025, were $1,140.4 million, a decrease of 2.0% compared to $1,163.8 million in the same period of 2024[111]. - For the six months ended September 30, 2025, net sales were $2,215.9 million, down 7.9% from $2,405.1 million in the same period of 2024[111]. - Gross profit margin for the three months ended September 30, 2025, was 55.9%, down from 57.4% in 2024, while for the six months it was 54.8%, down from 58.4% in 2024[109]. - Operating income for the three months ended September 30, 2025, was 7.8%, a decline from 12.6% in 2024, and for the six months, it was 5.5%, down from 15.2% in 2024[109]. - Gross profit for Q3 2025 was $637.9 million, or 55.9% of net sales, compared to $668.5 million, or 57.4% in Q3 2024[130]. - The company reported a total net loss of $132.0 million for the six months ended September 30, 2025[182]. Cost and Expenses - Cost of sales as a percentage of net sales increased to 44.1% for the three months ended September 30, 2025, compared to 42.6% in 2024[109]. - Research and development expenses as a percentage of net sales rose to 23.0% for the three months ended September 30, 2025, from 20.7% in 2024[109]. - R&D expenses for Q3 2025 were $262.3 million, or 23.0% of net sales, up from $240.7 million, or 20.7% in Q3 2024[138]. - R&D expenses for the first half of 2025 increased by $35.4 million, or 7.3%, totaling $517.8 million, or 23.4% of net sales[139]. - Selling, general and administrative expenses for Q3 2025 were $172.3 million, or 15.1% of net sales, compared to $157.0 million, or 13.5% in Q3 2024[141]. - Selling, general and administrative expenses for the first half of 2025 increased by $24.1 million, or 7.8%, totaling $331.6 million, or 15.0% of net sales[142]. - Special charges for Q3 2025 were $6.3 million, compared to $1.5 million in Q3 2024, primarily related to restructuring expenses[146]. Inventory and Sales Channels - Overall inventory levels decreased to $1.10 billion at September 30, 2025, from $1.29 billion at March 31, 2025, with inventory days dropping from 251 to 199[132]. - Distributors accounted for approximately 45% of net sales in Q3 2025, with Arrow Electronics being the largest distributor at 11% of net sales[125]. - Sales to foreign customers represented approximately 75% of total net sales in Q3 2025, up from 74% in Q3 2024[129]. Capital and Cash Flow - Net cash provided by operating activities for the first half of 2025 was $363.7 million, down from $420.7 million in the same period of 2024[165]. - Net cash used in investing activities was $98.9 million in the first half of 2025, compared to $189.7 million in the same period of 2024[166]. - Cash and cash equivalents decreased to $236.8 million as of September 30, 2025, down by $534.9 million from March 31, 2025[163]. - Net cash used in financing activities was $799.7 million for the six months ended September 30, 2025, compared to $264.6 million in the same period of 2024[168]. - The company paid cash dividends of $491.3 million to common stockholders in the first six months of fiscal 2026, compared to $486.3 million in the same period of fiscal 2025[169]. Debt and Financing - As of September 30, 2025, the principal amount of outstanding Commercial Paper was $1.12 billion, an increase from $175.0 million at March 31, 2025[172]. - As of September 30, 2025, the company's total current and long-term debt amounted to $5.41 billion, all of which is fixed rate[183]. - The company plans to refinance certain existing notes as they mature and may seek additional financing depending on market conditions and operational needs[178]. - The company plans to finance the repayment of its fixed rate debt maturing within the next 12 months using available borrowings under its Revolving Credit Facility or Commercial Paper program[183]. - Changes in interest rates will significantly impact the company's interest expense if it refinances fixed rate debt with variable rate debt[183]. Strategic Initiatives - The company plans to continue investments in new and enhanced products, focusing on mixed-signal microcontrollers, digital signal controllers, and other technologies[105]. - The company is executing a recovery plan initiated in March 2025, which includes reducing inventory levels and pausing factory expansion activities[100]. - The closure of the Tempe, Arizona wafer fabrication facility (Fab 2) was completed in May 2025, with production being transferred to Oregon and Colorado facilities[102]. - The company anticipates fluctuations in gross margins driven by capacity utilization levels and product mix[137]. - Approximately 66% of net sales in Q3 2025 came from products produced at outside wafer foundries, consistent with the previous year[136]. - The company expects to receive $162 million in CHIPS Act grants for two U.S. wafer fabrication facilities, pending final approval[167]. Market Conditions - Inflation has not materially affected the company's operating results in recent periods[184]. - The company may struggle to offset higher costs due to inflation through price increases, which could adversely impact operating results[184]. - Interest income for Q3 2025 was $3.6 million, up from $2.0 million in Q3 2024[147]. - Capital expenditures for the six months ended September 30, 2025, were $54.4 million, down from $93.7 million in the same period of 2024, with plans to keep investments at or below $100.0 million over the next 12 months[167].

EXHIBIT 99.1 INVESTOR RELATIONS CONTACT: Sajid Daudi -- Head of Investor Relations..... (480) 792-7385 MICROCHIP TECHNOLOGY ANNOUNCES FINANCIAL RESULTS FOR SECOND QUARTER OF FISCAL YEAR 2026 CHANDLER, Arizona - November 6, 2025 - (NASDAQ: MCHP) - Microchip Technology Incorporated, a leading provider of smart, connected, and secure embedded control solutions, today reported results for the three months ended September 30, 2025. Steve Sanghi, Microchip's CEO and President commented that "Our second quarter re ...

Net sales of $1.140 billion, increased 6.0% sequentially and declined 2.0% from the year ago quarter. The midpoint of our guidance provided on August 7, 2025 was net sales of $1.130 billion.On a GAAP basis: gross profit of 55.9%; operating income of $88.9 million and 7.8% of net sales; net income attributable to common stockholders of $13.9 million; and EPS of $0.03 per diluted share. Our guidance provided on August 7, 2025 was for GAAP EPS loss per diluted share of $0.04 to $0.01.On a Non-GAAP basis: gross ...

CHANDLER, Ariz., Nov. 06, 2025 (GLOBE NEWSWIRE) -- Further demonstrating its commitment to developing AI-enabled solutions for embedded engineers, Microchip Technology (Nasdaq: MCHP) has announced the launch of its Model Context Protocol (MCP) Server. An AI interface, the MCP Server connects directly with compatible AI tools and large language models (LLMs) to provide the context these systems need to answer questions. Through simple conversational queries, the MCP Server enables users to retrieve verified, ...

Core Insights - Microchip Technology Incorporated is a significant player in the semiconductor industry, focusing on microcontroller, mixed-signal, analog, and Flash-IP solutions [1] - The company is set to release its quarterly earnings on November 6, 2025, with analysts closely monitoring its performance metrics [1] Earnings Projections - Wall Street analysts project an earnings per share (EPS) of $0.33, representing a year-over-year decline of 28.3% [2][6] - The company has guided for EPS to range between $0.34 and $0.37, indicating potential variance from analyst expectations [2] Revenue Expectations - Revenue projections for the quarter are approximately $1.13 billion, reflecting a 2.7% year-over-year decline [3][6] - Microchip anticipates net sales to range between $1.11 billion and $1.15 billion, suggesting a sequential growth of 5.1% [3] Growth Drivers - The anticipated growth is driven by improving inventory levels, increased direct shipments, and strong design wins in sectors such as industrial, aerospace, and AI [3] Financial Metrics - The price-to-sales ratio is about 7.75, indicating investors are willing to pay $7.75 for every dollar of sales [4] - The enterprise value to sales ratio stands at approximately 8.91, reflecting the company's valuation in relation to its sales [4] - The debt-to-equity ratio is about 0.80, suggesting a balanced approach to leveraging debt for growth [5] - The current ratio of approximately 2.31 indicates a strong ability to cover short-term liabilities with short-term assets [5]

Core Insights - Ceva, Inc. has announced a long-term partnership with Microchip Technology Inc. to integrate Ceva's NeuPro family of Neural Processing Units (NPUs) into Microchip's products, enhancing AI capabilities across various applications [1][2][3] Company Overview - Ceva is a leading licensor of silicon and software IP for the Smart Edge, focusing on wireless communications, sensing, and Edge AI technologies [5][6] - Microchip is a broadline supplier of semiconductors, committed to simplifying innovative design through comprehensive system solutions [1][3] Partnership Details - The collaboration aims to embed Ceva's NeuPro NPUs in Microchip's products, facilitating the deployment of scalable AI in a wide range of devices [1][2] - Microchip's selection of Ceva's NeuPro family indicates a strategic commitment to deliver AI as a native capability in billions of devices, reinforcing its leadership in various markets including industrial, data center, aerospace, automotive, consumer, and communications [2][3] Technology and Innovation - Ceva's NeuPro NPU family is designed for high efficiency and low latency, optimized for inference workloads, and suitable for applications from ultra-low-power microcontrollers to advanced computing platforms [4] - The NeuPro Studio, a unified AI Software Development Kit (SDK), will be integrated into Microchip's SDK, providing a comprehensive developer experience for training, importing, optimizing, and deploying AI models [3][4] Market Impact - The partnership reflects a broader industry trend towards making AI foundational across devices, systems, and infrastructure, enabling richer and more intelligent user experiences [4]