Truist Cautious on Microchip Technology (MCHP) After Q3 Beat But Below-Consensus Q4 Guidance

Core Insights - Microchip Technology Incorporated (NASDAQ:MCHP) is viewed as a strong stock within the QQQ index, despite recent challenges highlighted by analysts [1] - Truist analyst William Stein has lowered the price target for Microchip from $64 to $60 while maintaining a Hold rating, citing a modest Q3 2025 performance but below-consensus guidance for Q4 [1][3] Financial Performance - In Q3, Microchip reported net sales of $1.026 billion, reflecting an 11.8% sequential decline and a significant 41.9% year-over-year decrease [2] - The company achieved a Non-GAAP net income of $107.3 million, resulting in a Non-GAAP EPS of $0.20 [2] Future Guidance - For the upcoming March quarter, Microchip has guided net sales to be between $920 million and $1 billion, indicating continued near-term challenges [3] - Despite these difficulties, the company is focusing on innovation, having introduced a new generation of 64-bit RISC-V processors with advanced AI capabilities and expanded its Wi-Fi portfolio with 20 new products [3] Company Overview - Microchip Technology develops, manufactures, and sells embedded control solutions across the Americas, Europe, and Asia, operating through two segments: Semiconductor Products and Technology Licensing [4]