Microchip Technology (MCHP) reported third-quarter fiscal 2024 non-GAAP earnings of $1.08 per share, which beat the Zacks Consensus Estimate by 1.89% but declined 30.8% on a year-over-year basis.Net sales of $1.77 billion decreased 14.8% year over year and lagged the Zacks Consensus Estimate by 1.41%.Quarter in DetailIn terms of product line, mixed-signal microcontroller sales declined 18.5% year over year and 22.3% sequentially. Analog net sales decreased 30.9% sequentially and 29% year over year.Sales fro ...

For the quarter ended December 2023, Microchip Technology (MCHP) reported revenue of $1.77 billion, down 18.6% over the same period last year. EPS came in at $1.08, compared to $1.56 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $1.79 billion, representing a surprise of -1.41%. The company delivered an EPS surprise of +1.89%, with the consensus EPS estimate being $1.06.While investors scrutinize revenue and earnings changes year-over-year and how they compare with ...

Microchip Technology (MCHP) came out with quarterly earnings of $1.08 per share, beating the Zacks Consensus Estimate of $1.06 per share. This compares to earnings of $1.56 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 1.89%. A quarter ago, it was expected that this chipmaker would post earnings of $1.62 per share when it actually produced earnings of $1.62, delivering no surprise.Over the last four quarters, the company has ...

Net sales of $1.766 billion, down 21.7% sequentially and down 18.6% from the year ago quarter. Our preliminary net sales results provided on January 8, 2024 was for net sales to be down 22% sequentially.On a GAAP basis: gross profit of 63.4%; operating income of $529.4 million and 30.0% of net sales; net income of $419.2 million; and EPS of $0.77 per diluted share. Our guidance provided on November 2, 2023 was for GAAP EPS of $0.68 to $0.76 per diluted share. On a Non-GAAP basis: gross profit of 63.8%; oper ...

Financial Performance - For the three months ended December 31, 2023, net sales were 100% of total sales, with a gross profit margin of 63.4%, down from 67.8% in the same period of 2022 [101]. - Operating income for the three months ended December 31, 2023, was 30.0%, a decrease from 37.4% in the same period of 2022 [101]. - Net sales for the three months ended December 31, 2023, were $1,765.7 million, a decrease of 18.6% compared to $2,169.2 million in the same period of 2022 [103]. - For the nine months ended December 31, 2023, net sales increased by 1.7% to $6,308.6 million from $6,206.0 million in the prior year [103]. - Gross profit for Q3 2023 was $1.12 billion, or 63.4% of net sales, down from $1.47 billion, or 67.8% in Q3 2022 [120]. - The company experienced an adverse impact of $300.0 million on gross profit in Q3 2023 due to sales volume and product mix [121]. Research and Development - Research and development expenses increased to 15.1% of net sales for the three months ended December 31, 2023, compared to 13.0% in the same period of 2022 [101]. - R&D expenses for the three months ended December 31, 2023 were $266.0 million, or 15.1% of net sales, a decrease from $282.4 million, or 13.0% of net sales, in the same period of 2022 [128]. - R&D expenses increased by $37.1 million, or 4.5%, for the nine months ended December 31, 2023 compared to the same period last year, primarily due to increases in headcount and employee compensation [129]. - The company is committed to investing in new and enhanced products, focusing on mixed-signal microcontrollers, digital signal controllers, and FPGAs [97]. Production and Capacity - In fiscal 2023, the company announced an $800 million capacity expansion plan at Fab 4 in Gresham, Oregon, and plans to invest $880 million to expand silicon carbide and silicon production capacity [94]. - The company plans to reduce production levels and implement up to two weeks of shutdown days in global fabrication facilities due to weak macroeconomic conditions [91]. - The company has reduced planned capital investments through fiscal 2025 in response to the weak macroeconomic environment [91]. - The company plans to invest between $200 million and $300 million in equipment and facilities over the next 12 months to support new products and technologies [155]. Sales and Market Trends - Mixed-signal microcontrollers accounted for 56.3% of net sales in Q3 2023, with a decrease of 18.5% compared to Q3 2022, while increasing by 3.3% for the nine-month period [106][107]. - Analog product line sales decreased by 29.0% in Q3 2023 and 4.1% for the nine months, accounting for 24.4% and 26.7% of net sales, respectively [109][110]. - Other product line sales accounted for 19.3% of net sales in Q3 2023, remaining flat compared to Q3 2022, but increased by 6.2% for the nine-month period [112][113]. - Distributors represented approximately 44% of net sales in Q3 2023, down from 48% in Q3 2022, primarily due to inventory management efforts [114]. - Foreign customers accounted for approximately 75% of total net sales in both Q3 2023 and Q3 2022 [119]. Cash Flow and Financing - Net cash provided by operating activities was $2.46 billion in the nine months ended December 31, 2023, driven by higher net income of $1.75 billion [153]. - Net cash used in investing activities was $320.9 million in the nine months ended December 31, 2023, compared to $448.7 million in the same period of 2022 [154]. - Net cash used in financing activities was $2.09 billion for the nine months ended December 31, 2023, compared to $2.49 billion in the same period of 2022 [156]. - Cash dividends paid to stockholders were $669.0 million in the first nine months of fiscal 2024, up from $499.4 million in the same period of fiscal 2023 [156]. - The company repurchased approximately 7.4 million shares for $594.7 million in the first nine months of fiscal 2024, compared to 9.6 million shares for $671.9 million in the same period of fiscal 2023 [159]. Debt and Interest - As of December 31, 2023, the principal amount of outstanding indebtedness was $5.71 billion, with no borrowings under the Revolving Credit Facility [158]. - Interest expense decreased to $49.2 million for the three months ended December 31, 2023, down from $52.8 million in the same period of 2022 [138]. - The company has no interest rate exposure on $4.96 billion of fixed-rate debt, but a 50-basis point increase in interest rates would raise expected annual interest expense by approximately $3.8 million on $750.0 million of variable-rate debt [164]. Strategic Initiatives - The Preferred Supply Program was discontinued in February 2024 as industry capacity conditions improved, which had been initiated in February 2021 [92]. - The company maintains a strong technical service presence, which is considered essential for the continued development of the embedded control market [98]. - A Preliminary Memorandum of Terms was reached with the U.S. Department of Commerce for $162 million in CHIPS Act grants for two U.S. wafer fabrication facilities, subject to due diligence and negotiation [155]. - The company is pursuing incentives under the CHIPS Act to enhance domestic manufacturing capacity, though there is no assurance of receiving such incentives [163].

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Wall Street expects a year-over-year decline in earnings on lower revenues when Microchip Technology (MCHP) reports results for the quarter ended December 2023. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on February 1, 2024, might help the stock move higher if these key numbers are bette ...

Microchip Technology (MCHP) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.Over the past month, shares of this chipmaker have returned -0.6%, compared to the Zacks S&P 500 composite's +2.5% change. During this period, the Zacks Semiconductor - Analog and Mixed industry, which Microchip Tech falls in, has lost 1.5%. The key question now is: What could be the stock' ...

In the latest market close, Microchip Technology (MCHP) reached $90.74, with a +1.45% movement compared to the previous day. The stock exceeded the S&P 500, which registered a gain of 0.22% for the day. At the same time, the Dow added 0.36%, and the tech-heavy Nasdaq gained 0.32%.The the stock of chipmaker has fallen by 0.83% in the past month, lagging the Computer and Technology sector's gain of 3.64% and the S&P 500's gain of 1.61%.The investment community will be paying close attention to the earnings pe ...

CHANDLER, Ariz., Jan. 22, 2024 (GLOBE NEWSWIRE) -- Microchip Technology Incorporated, a leading provider of smart, connected and secure embedded control solutions, today announced that Ellen Barker, former Senior Vice President and Chief Information Officer of Texas Instruments (TI), will join the Board of Directors of Microchip effective February 2, 2024. With this appointment, Microchip's Board will be comprised of 8 members, 6 of whom are independent. Ms. Barker has not yet been appointed to any committe ...