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Microchip Technology
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NASDAQ: MCHP Technology Semiconductors 🔎 Screen
S&P 500 Nasdaq 100
$41.1B
Market Cap
293.7
P/E
0.91
PEG
3.5%
ROCE
3.4%
ROE
0.85
D/E
10.4%
OPM
-27.5%
% from 52W High
49
α RS
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Currency-adjusted total returns for MCHP including FX impact
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📈 Price History
Ratio Health
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About

Microchip Technology Incorporated develops, manufactures, and sells smart, connected, and secure embedded control solutions in the Americas, Europe, and Asia.

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⭐ Superinvestors Holding MCHP
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Manager Shares Value % of Fund Period
Steve Cohen Point72 Asset Management 2.32M $150.2M 0.19% Mar 2026
Jim Simons Renaissance Technologies LLC 28.4K $1.8M 0.00% Mar 2026

SEC Form 13F data. 45-day lag from quarter end.

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Good quarter Investor Presentation One-Pager? Q1 2027
Revenue
$1.485B
+38% YoY
Operating Income
$521.1M
Not stated
Operating Margin
35.1%
Not stated
Net Income
$438.6M
+183.6% YoY
What Went Right
  • Revenue of $1.485B came in above the high end of guidance, up 38% YoY and 13.2% sequentially.
  • Data center sales grew 97.8% YoY; total data center revenue is expected to reach ~$1B in CY2026, up ~69%.
  • Non-GAAP EPS of $0.76 beat the midpoint by $0.07, and non-GAAP operating margin improved 452 bps sequentially to 35.1%.
What to Watch
  • Supply constraints are broadening across foundry, substrate, and OSAT capacity, stretching lead times and limiting upside.
  • Management cautioned that September-quarter gross margin benefits from one-time items — a strong licensing quarter and price-change distribution inventory effect — are not repeatable and margins should not be modeled above 66.5%.
  • Net debt remains elevated at ~$5.2B; the company will prioritise debt repayment and does not plan buybacks or dividend increases in the foreseeable future.
Management Guidance
  • September quarter net sales expected up 8% sequentially ±1%, representing ~40.6% YoY growth at the midpoint.
  • Non-GAAP gross margin guided to 66%-67%; non-GAAP operating margin to 38.5%-39.5%.
  • Non-GAAP EPS guided to $0.91-$0.95, up 22.4% sequentially at the midpoint.
Investor Lens
The thesis is stronger after this call: the cyclical recovery is broadening beyond data center into industrial, auto, and aerospace/defense, and the company is executing well on inventory normalisation and margin expansion. Data center exposure is now 17.1% of sales and still ramping, with 14 PCIe Gen 6 design wins ahead of volume shipments. However, management has explicitly capped near-term gross margin expectations and flagged capacity constraints, so the market should temper extrapolation of the September quarter's one-off benefits. Overall, the recovery narrative is intact and supported by a book-to-bill well above 1 and the strongest booking quarter in four years.
From investor presentation · AI-generated analysis · Not investment advice
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📈 STRONG Strong beat: revenue up 38% YoY, Q2 guidance tops 66% gross margin
Revenue
Revenue was $1.485B, up 38% YoY and 13.2% sequentially, beating the high end of guidance. End-market split for the June quarter: industrial 32.2%, data center 17.1%, aerospace/defense 16.7%, automotive 15%, communication 8.2%, consumer appliances 7.4%, and compute 3.4%. Data center sales grew 97.8% YoY, industrial grew 24.3%, and automotive grew 29.3%.
Profitability
Non-GAAP net income was $438.6M, up from $154.7M in the year-ago quarter, with diluted EPS of $0.76 versus $0.27. GAAP net income attributable to common stockholders was $202.0M, or $0.37 per share, compared with a GAAP net loss of $46.4M a year ago.
Margins
Non-GAAP gross margin was 63.8%, up 222 bps sequentially and including $38.5M of capacity underutilization charges. Non-GAAP operating margin was 35.1%, up 452 bps sequentially. For September, management guides non-GAAP gross margin to 66%-67% and operating margin to 38.5%-39.5%.
Balance Sheet
Cash and investments were $272.3M; total debt decreased by $138M and net debt by ~$170M in the June quarter. Net debt to adjusted EBITDA was 2.85. Operating cash flow was $511.5M and adjusted free cash flow was $478.6M. Capex was $13.9M in the quarter, with FY2027 capex expected to be ~$100M.
Key Risks
Management flagged broadening supply constraints across foundry, substrate, and test/assembly capacity, with AI demand crowding out capacity and customer expedites going unsupported. Gross margin guidance benefits from one-time items that management says should not be extrapolated higher. The company's high debt load remains a focus, limiting capital returns to debt paydown for now.
Outlook
September quarter revenue is expected to be up 7%-9% sequentially, with non-GAAP EPS of $0.91-$0.95 and gross margin of 66%-67%. Management also said the December quarter should be better than seasonal.
Generated by AI · Q1 2027 results · Not investment advice
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✓ 📞 Earnings Call Transcripts (5 quarters) submit a missing quarter
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📞 Earnings Call Transcripts (5)
Q1 2027 Q1 2027 2026-08-06
Net sales and profitability exceeded guidance, driven by robust data center, aerospace & defense, and communication growth. September quarter guidance calls for continued strong sales and record gross margins, with supply constraints and one-time margin benefits noted. Debt reduction remains a priority.
Q4 2026 Q4 2026 2026-05-07
Q4 and FY26 saw robust revenue and margin growth, with strong momentum in data center, aerospace & defense, and industrial segments. Inventory and distribution channels have normalized, and guidance points to continued double-digit sequential growth, though supply chain tightness and lead time extensions remain key risks.
Q3 2026 Q3 2026 2026-02-05
Net sales grew 4% sequentially and 15.6% year-over-year, led by networking, data center, and FPGA segments. March quarter guidance calls for 6.2% sequential growth, with strong backlog and improving gross margins, while capital allocation remains focused on debt reduction.
Q2 2026 Q2 2026 2025-11-06
Q2 FY26 saw 6% sequential sales growth, strong data center and MCU performance, and healthy product gross margins despite inventory and underutilization charges. December quarter guidance is slightly down, but strong bookings and inventory normalization are expected to drive growth in subsequent quarters.
Q1 2026 Q1 2026 2025-08-07
Q1 FY26 saw 10.8% sequential sales growth, broad-based recovery, and significant inventory reduction. Guidance for Q2 is above seasonal, with further margin improvement expected as inventory and underutilization charges decline. Capital allocation will prioritize debt reduction before buybacks.
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Financial Model
Projections are built from each company's audited annual financials (Income Statement, Balance Sheet, Cash Flow) over the last 5 fiscal years. Forward assumptions — revenue growth %, EBITDA margin, D&A (USD millions), interest expense, tax rate, and capex — are AI-generated using historical context and refreshed twice a year: after the December results season and after the September/Q4 results season.

DCF Valuation
Fair Value = Σ(FCFt / (1+WACC)t) + Terminal Value. Terminal Value uses the Gordon Growth Model: FCF5 × (1+g) / (WACC−g). Default WACC: 10% (US risk-free ~4.5%, equity risk premium ~5.5%). Default terminal growth: 3% (long-run US nominal GDP proxy).

CAGR Tracker
Expected 5-year CAGR = (DCF Fair Value / Current Price)1/5 − 1. Assumes fair value is reached in exactly 5 years — a mechanical estimate only.

Data Sources & Limitations
Financial statements sourced from public filings. Prices updated daily. Forward assumptions are AI-generated. All monetary values in USD millions. Non-US ADR companies may have currency conversion inaccuracies. Models are point-in-time and do not update intra-quarter or account for M&A, macro shocks, or extraordinary items.

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Investment Risk:
Investing in securities, including US equities and ETFs, involves inherent risks including the potential loss of principal. All investments are subject to market fluctuations, economic conditions, regulatory changes, and other factors that may affect their value. Past performance is not indicative of future results. This analysis is provided for informational and educational purposes only and should not be construed as investment advice under any circumstances.

No Investment Recommendation:
This analysis does not constitute, nor should it be interpreted as, an offer, solicitation, or recommendation to buy, sell, or hold any securities or financial products. Investors are strongly advised to conduct their own independent research and due diligence and to consult with a licensed financial advisor or an SEC-registered investment adviser before making any investment decisions, taking into account their individual financial situation, risk tolerance, and investment objectives.

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Conflict of Interest Disclosure:
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Information Sources:
The analysis is based on publicly available information including SEC filings (10-K, 10-Q), annual reports, management commentary, and publicly available financial data. Information is believed to be accurate as of the date of publication but may be subject to change without notice. Readers are encouraged to independently verify all information before acting upon it.

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