INVESTOR RELATIONS CONTACT:
EXHIBIT 99.1 NEWS RELEASE INVESTOR RELATIONS CONTACT: Sajid Daudi -- Head of Investor Relations..... (480) 792-7385
MICROCHIP TECHNOLOGY ANNOUNCES FINANCIAL RESULTS FOR SECOND QUARTER OF FISCAL YEAR 2027
sequentially. The midpoint of our guidance provided on August 6, 2026 was net sales of $1.604 billion.
On a GAAP basis: gross profit of 65.9%; operating income of $464.5 million and 28.6% of net sales; net income attributable to common stockholders of $373.6 million; and EPS of $0.68 per diluted share. Our guidance provided on August 6, 2026 was GAAP EPS per diluted share of $0.53 to $0.54.
On a Non-GAAP basis: gross profit of 66.5%; operating income of $639.9 million and 39.5% of net sales; net income of $559.2 million; and EPS of $0.97 per diluted share. Our guidance provided on August 6, 2026 was Non-GAAP EPS per diluted share of $0.91 to $0.95.
Quarterly dividend on common stock declared for the December quarter of 45.5 cents per share.
Completed acquisitions of Hailo, a provider of accelerated edge AI processors, on September 17th, and Vorago Technologies, a provider of radiation-hardened microcontrollers and microprocessors, on October 8th.
CHANDLER, Arizona - November 5, 2026 - (NASDAQ: MCHP) - Microchip Technology Incorporated, a broadline supplier of semiconductors committed to making innovative design easier through total system solutions, today reported results for the three months ended September 30, 2026.
"Our September quarter net sales were above the high end of our guidance, increasing 42.2% year over year and 9.2% sequentially to $1.622 billion," said Steve Sanghi, Microchip’s President and Chief Executive Officer. "The momentum from the start of fiscal 2027 continued in the September quarter, with broad- based growth across our end markets, driven by industrial and data center applications. Our growth is increasingly supported by new design wins and product innovations, which we believe positions us well for the opportunities ahead." - - more - -
Microchip Technology Incorporated 2355 West Chandler Blvd. Chandler, AZ 85224-6199 Main Office 480•792•7200 Microchip Technology Reports
Mr. Sanghi added, “Bookings remained robust, with book-to-bill well above one, consistent with recent quarters. We are winning new designs across our end markets, including data center, where our PCIe Gen6 switch and retimer design wins have grown to 24 to date, up from 12 at the end of the June quarter. We also broadened our portfolio, with a steady cadence of product and technology introductions across data center, aerospace and defense, automotive and industrial applications, which expands the foundation for future design wins."
Eric Bjornholt, Microchip's Corporate Senior Vice President and Chief Financial Officer, said, "Our September quarter results reflect ongoing operational improvements, with non-GAAP operating expenses growing well below net sales and supporting higher profitability. We believe our existing manufacturing footprint enables us to grow with modest incremental capital investment, and we remain focused on strengthening our balance sheet while making targeted investments that accelerate our product roadmap.”
Mr. Sanghi concluded, “As we enter the December quarter, we are experiencing some normal seasonal factors in our business. Normal seasonality is for our revenue to be down sequentially 3% to 5% in the December quarter. We expect net sales for the December quarter to be between down 3% and up 1% sequentially, with a midpoint of down 1%. The midpoint of our December quarter guidance represents year-over-year growth of approximately 35.4%. Our guidance of down 1% at the midpoint needs to be considered with the fact that we had about $53 million of infrequent revenue items in the September quarter which do not repeat in the December quarter. Taking this into consideration, the midpoint of our guidance for the December quarter represents guidance that is 5% to 7% better than normal seasonality. Lead times are lengthening across our supply chain, and we are working to expand capacity and secure additional wafer allocation. We expect non-GAAP gross margin to be between 64% and 65% and GAAP gross margin to be between 62.9% and 63.9%. Together, data center, aerospace and defense, industrials, robotics, automotive and the intelligent edge are the secular trends we see driving growth over the long-term.” - - more - - Microchip Technology Reports
The following table summarizes Microchip's reported results for the three months ended September 30, 2026.
Three Months Ended September 30, 2026(1) Net sales $1,621.5 GAAP % Non-GAAP(2) % Gross profit $1,068.0 65.9% $1,077.8 66.5% Operating income $464.5 28.6% $639.9 39.5% Other expense $(47.0) $(47.0) Income tax $16.1 $33.7 provision Net income $401.4 $559.2 Dividends on Series $(27.8) — A Preferred Stock Net income attributable to $373.6 23.0% $559.2 34.5% common stockholders Diluted net income $0.68 $0.97 per common share
Net sales for the second quarter of fiscal 2027 were $1.622 billion, up 42.2% from net sales of $1.140 billion in the prior year's second fiscal quarter.
GAAP net income attributable to common stockholders for the second quarter of fiscal 2027 was $373.6 million, or $0.68 per diluted share, up from GAAP net income attributable to common stockholders of $13.9 million, or $0.03 per diluted share, in the prior year's second fiscal quarter. For the second quarters of fiscal 2027 and fiscal 2026, GAAP results were adversely impacted by amortization of acquired intangible assets associated with our previous acquisitions.
Non-GAAP net income for the second quarter of fiscal 2027 was $559.2 million, or $0.97 per diluted share, up from non-GAAP net income of $199.1 million, or $0.35 per diluted share, in the prior year's second fiscal quarter. For the second quarters of fiscal 2027 and fiscal 2026, our non-GAAP results exclude the effect of share-based compensation, restructuring charges, expenses related to our acquisition activities (including intangible asset amortization, severance, other restructuring costs, and legal and other general and administrative expenses including legal fees and expenses for litigation related to our Microsemi acquisition), professional services associated with certain legal matters, (gain) loss on available-for-sale investments, and dividends on our Series A Mandatory Convertible Preferred Stock. For the second quarters of fiscal 2027 and fiscal 2026, our non-GAAP income tax expense is presented based on projected cash taxes for the applicable fiscal year, excluding transition tax payments under the Tax Cuts and Jobs Act. A reconciliation of our non-GAAP and GAAP results is included in this press release.
Microchip announced today that its Board of Directors declared a quarterly cash dividend on its common stock of 45.5 cents per share, which is payable on December 8, 2026 to stockholders of record on November 23, 2026. Our Board also declared a quarterly cash dividend on Microchip's 7.50% Series A Mandatory Convertible Preferred Stock of $18.750 per share (which represents $0.9375 per depositary share) which is payable on December 15, 2026 to stockholders of record on December 1, 2026. - - more - - Microchip Technology Reports
Microchip also announced that, on November 3, 2026, Victor Peng informed our Board of Directors of his decision to step down from the Board due to his time commitments on other matters including serving as Chief Executive Officer of PsiQuantum. The Board thanks Mr. Peng for his service and contributions during his tenure on the Board. - - more - - Microchip Technology Reports
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Microchip Consolidated Guidance Net Sales $1.573 to $1.638 billion GAAP(5) Non-GAAP Non-GAAP(1) Adjustments(1) Gross Profit 62.9% to 63.9% $17.7 to $18.7 64.0% to 65.0% million Operating 36.7% to 37.4% $163.0 to $167.0 26.5% to 27.0% Expenses(2) million Operating 25.5% to 27.2% $180.8 to $185.8 37.0% to 38.5% Income million Other Expense, $47.7 to $48.3 $(0.2) to $0.2 $47.5 to $48.5 net million million million Income Tax $67.1 to $91.3 $(53.4) to $34.7 to $37.9 Provision million(3) $(32.4) million million(4) Net income $285.9 to $305.8 $212.9 to $239.3 $498.8 to $545.1 million million million Dividends on Series A $(27.8) million $27.8 million — Preferred Stock Net income attributable to $258.1 to $278.0 $240.7 to $267.1 $498.8 to $545.1 common million million million stockholders Diluted Common Approximately 23.8 million Approximately Shares 551.0 to 552.0 shares 574.8 to 575.8 Outstanding million shares million shares Diluted net income per $0.47 to $0.50 $0.40 to $0.45 $0.87 to $0.95 common share
(1) See the "Use of Non-GAAP Financial Measures" section of this release for information regarding our non-GAAP guidance.
(2) We are not able to estimate the amount of certain Special Charges and Other, net that may be incurred during the quarter ending December 31, 2026. Therefore, our estimate of GAAP operating expenses excludes certain amounts that may be recognized as Special Charges and Other, net in the quarter ending December 31, 2026.
(3) The forecast for GAAP tax expense excludes any unexpected tax events that may occur during the quarter, as these amounts cannot be forecasted.
(4) Represents the expected cash tax rate for fiscal 2027, excluding any transition tax payments associated with the Tax Cuts and Jobs Act.
(5) Our GAAP guidance excludes the impact of any potential gains or charges related to our ongoing evaluation of restructuring activities including the sale of our Fab 2 wafer fabrication facility in Tempe, Arizona.
Capital expenditures for the quarter ending December 31, 2026 are expected to be about $35 million. Capital expenditures for all of fiscal 2027 are expected to be approximately $100 million. Consistent with the slow macroeconomic environment in fiscal 2025, we have paused most of our factory expansion actions and reduced our planned capital investments through fiscal 2027. However, we are adding capital equipment to selectively expand our production capacity and add research and development equipment.
Under the GAAP revenue recognition standard, we are required to recognize revenue when control of the product changes from us to a customer or distributor. We focus our sales and marketing efforts on creating demand for our products in the end markets we serve and not on moving inventory into our distribution network. We also manage our manufacturing and supply chain operations, including our distributor relationships, towards the goal of having our products available at the time and location the end customer desires. - - more - - Microchip Technology Reports
Use of Non-GAAP Financial Measures: Our non-GAAP adjustments, where applicable, include the effect of share-based compensation, restructuring charges, expenses related to our acquisition activities (including intangible asset amortization, severance, other restructuring costs, and legal and other general and administrative expenses including legal fees and expenses for litigation related to our Microsemi acquisition), professional services associated with certain legal matters, (gain) loss on available-for-sale investments, and dividends on our Series A Mandatory Convertible Preferred Stock. For the second quarters of fiscal 2027 and fiscal 2026, our non-GAAP income tax expense is presented based on projected cash taxes for the fiscal year, excluding transition tax payments under the Tax Cuts and Jobs Act.
We are required to estimate the cost of certain forms of share-based compensation, including restricted stock units and our employee stock purchase plan, and to record a commensurate expense in our income statement. Share-based compensation expense is a non-cash expense that varies in amount from period to period and is affected by the price of our stock at the date of grant. The price of our stock is affected by market forces that are difficult to predict and are not within the control of management. Our other non-GAAP adjustments are either non-cash expenses, unusual or infrequent items, or other expenses related to transactions. Management excludes all of these items from its internal operating forecasts and models.
We are using non-GAAP operating expenses in dollars, including non-GAAP research and development expenses and non-GAAP selling, general and administrative expenses, non-GAAP other expense, net, and non-GAAP income tax rate, which exclude the items noted above, as applicable, to permit additional analysis of our performance.
Management believes these non-GAAP measures are useful to investors because they enhance the understanding of our historical financial performance and comparability between periods. Many of our investors have requested that we disclose this non-GAAP information because they believe it is useful in understanding our performance as it excludes non-cash and other charges that many investors feel may obscure our underlying operating results. Management uses non-GAAP measures to manage and assess the profitability of our business and for compensation purposes. We also use our non-GAAP results when developing and monitoring our budgets and spending. Our determination of these non-GAAP measures might not be the same as similarly titled measures used by other companies, and it should not be construed as a substitute for amounts determined in accordance with GAAP. There are limitations associated with using these non- GAAP measures, including that they exclude financial information that some may consider important in evaluating our performance. Management compensates for this by presenting information on both a GAAP and non-GAAP basis for investors and providing reconciliations of the GAAP and non-GAAP results.
Generally, gross profit fluctuates over time, driven primarily by the mix of products sold and licensing revenue; variances in manufacturing yields; fixed cost absorption; wafer fab loading levels; costs of wafers from foundries; inventory reserves; pricing pressures in our non-proprietary product lines; and competitive and economic conditions. Operating expenses fluctuate over time, primarily due to net sales and profit levels. - - more - - Microchip Technology Reports
Diluted Common Shares Outstanding can vary for, among other things, the trading price of our common stock, the vesting of restricted stock units, the potential for incremental dilutive shares from our convertible debentures and our mandatory convertible preferred stock (additional information regarding our share count is available in the investor relations section of our website under the heading "Supplemental Information"), and repurchases or issuances of shares of our common stock. The diluted common shares outstanding presented in the guidance table above assumes an average Microchip stock price in the December 2026 quarter between $75 and $85 per share (however, we make no prediction as to what our actual share price will be for such period or any other period). - - more - - Page 8
RECONCILIATION OF GAAP RESEARCH AND DEVELOPMENT EXPENSES TO NON-GAAP RESEARCH AND DEVELOPMENT EXPENSES
RECONCILIATION OF GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSES TO NON-GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
(1) Amortization of acquired intangible assets consists of core and developed technology and customer-related acquired intangible assets in connection with business combinations. Such charges are excluded for purposes of calculating certain non-GAAP measures.
(1) Amortization of acquired intangible assets consists of core and developed technology and customer-related acquired intangible assets in connection with business combinations. Such charges are excluded for purposes of calculating certain non-GAAP measures. The use of acquired intangible assets contributed to our revenues earned during the periods presented. - - more - - Page 12
RECONCILIATION OF GAAP INCOME TAX PROVISION (BENEFIT) TO NON-GAAP INCOME TAX PROVISION
RECONCILIATION OF GAAP NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS AND GAAP DILUTED NET INCOME (LOSS) PER COMMON SHARE TO NON-GAAP NET INCOME AND NON- GAAP DILUTED NET INCOME PER COMMON SHARE
RECONCILIATION OF GAAP DILUTED COMMON SHARES OUTSTANDING TO NON-GAAP DILUTED COMMON SHARES OUTSTANDING
Three Six Months Months Ended Ended Septemb… September 30, 30, 2026 2025 2026 2025 Diluted common shares 550.6 545.0 550.6 539.6 outsta… as report… Diluti… effect — — — 3.8 of RSUs(1) Diluti… effect of 2017 — — — 0.4 Senior Conver… Debt(1) Diluti… effect of Series 23.8 23.8 23.8 25.4 A Prefer… Stock(… Diluted common shares 574.4 568.8 574.4 569.2 outsta… non-GA…
(1) The non-GAAP adjustment includes the impact that is anti-dilutive on a GAAP basis for the periods shown in the table above.
Microchip will host a conference call today, November 5, 2026 at 5:00 p.m. (Eastern Time) to discuss this release. This call will be simulcast over the Internet at www.microchip.com . The webcast will be available for replay until December 3, 2026.
A telephonic replay of the conference call will be available at approximately 8:00 p.m. (Eastern Time) on November 5, 2026 and will remain available until 5:00 p.m. (Eastern Time) on December 3, 2026. Interested parties may listen to the replay by dialing 201-612-7415/877-660-6853 and entering access code 13761638.
The statements in this release relating to the momentum from the start of fiscal 2027, broad-based growth across our end markets driven by industrial and data center applications, growth being increasingly supported by new design wins and product innovations which we believe positions us well for the opportunities ahead, that we are winning new designs across our end markets, that we have a steady cadence of product and technology introductions across data center, aerospace and defense, automotive and industrial applications which expands the foundation for future design wins, ongoing operational improvements with non- GAAP operating expenses growing well below net sales and supporting higher profitability, that we believe our existing manufacturing footprint enables us to grow with modest incremental capital investment, that we remain focused on strengthening our balance sheet while making targeted investments that accelerate our product roadmap, that we are experiencing some normal seasonal factors in our business, normal seasonality is for our revenue to be down sequentially 3% to 5% in the December quarter, that we expect net sales for the December quarter to be between down 3% and up 1% sequentially, with a midpoint of down 1%, that the midpoint of our December quarter guidance represents year- over-year growth of approximately 35.4%, that the infrequent revenue items in the September quarter do not repeat in the December quarter, that the midpoint of our guidance for the December quarter represents guidance that is 5% to 7% better than normal seasonality, that lead times are lengthening across our supply chain, that we are working to expand capacity and secure additional wafer allocation, that we expect non-GAAP gross margin to be between 64% and 65% and GAAP gross margin to be between 62.9% and 63.9%, that together, data center, aerospace and defense, industrials, robotics, automotive and the intelligent edge are the secular trends we see driving growth over the long-term, our third quarter fiscal 2027 guidance for net sales and GAAP and non-GAAP gross profit, operating expenses, operating income, other expense, net, income tax provision, net income, dividends on Series A Preferred Stock, net income attributable to common stockholders, diluted common shares outstanding, diluted net income per common share, capital expenditures for the December 2026 quarter and for all of fiscal 2027, adding capital equipment to selectively expand our production capacity and add research and development equipment, our belief that non-GAAP measures are useful to investors and our assumed average stock price in the December 2026 quarter are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause our actual results to differ materially, including, but not limited to: any continued uncertainty, fluctuations or weakness in the U.S. and world economies (including China and Europe) due to changes in interest rates or high inflation, actions taken or which may be taken by the Trump administration or the U.S. Congress, the impact of the November elections in the U.S., monetary policy, political, geopolitical, trade or other issues in the U.S. or internationally (including the military conflicts in the Middle East and Ukraine-Russia), the scope and level of tariffs; further changes in demand or market acceptance of our products and the products of our customers - - more - - Microchip Technology Reports
and our ability to respond to any increases or decreases in market demand or customer requests to increase orders or reschedule or cancel orders; the mix of inventory we hold, our ability to satisfy any short-term orders from our inventory and our ability to effectively manage our inventory levels; changes or fluctuations in customer order patterns and seasonality; changes in utilization of our manufacturing capacity and our ability to effectively manage our production levels to meet any increases or decreases in market demand or any customer requests to reschedule or cancel orders; the impact of inflation on our business; competitive developments including pricing pressures; the level of orders that are received and can be shipped in a quarter; our ability to realize the expected benefits of our long-term supply assurance program; our ability to effectively manage our supply of wafers from third party wafer foundries to meet any increases or decreases in our needs and the cost of such wafers, our ability to obtain additional capacity from our suppliers to increase production to meet any future increases in market demand; our ability to successfully integrate the operations and employees, retain key employees and customers and otherwise realize the expected synergies and benefits of our acquisitions; the impact of any future significant acquisitions or strategic transactions we may make; the costs and outcome of any current or future litigation or other matters involving our acquisitions (including the acquired business, intellectual property, customers, or other issues); foreign currency effects on our business; the costs and outcome of any current or future tax audit or investigation regarding our business or our acquired businesses; the impact that the CHIPS Act will have on increasing manufacturing capacity in our industry by providing incentives for us, our competitors and foundries to build new wafer manufacturing facilities or expand existing facilities; the amount and timing of any incentives we may receive under the CHIPS Act, the impact of current and future changes in U.S. corporate tax laws (including the One Big Beautiful Bill Act, the Inflation Reduction Act of 2022 and the Tax Cuts and Jobs Act of 2017); fluctuations in our stock price and trading volume which could impact the number of shares we acquire under our share repurchase program and the timing of such repurchases; disruptions in our business or the businesses of our customers or suppliers due to natural disasters (including any floods in Thailand), terrorist activity, armed conflict, war, worldwide oil prices and supply, public health concerns or disruptions in the transportation system; and general economic, industry or political conditions in the United States or internationally.
For a detailed discussion of these and other risk factors, please refer to Microchip's filings on Forms 10-K and 10-Q. You can obtain copies of Forms 10-K and 10-Q and other relevant documents for free at Microchip's website ( www.microchip.com ) or the SEC's website ( www.sec.gov ) or from commercial document retrieval services.
Stockholders of Microchip are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. Microchip does not undertake any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this November 5, 2026 press release, or to reflect the occurrence of unanticipated events. - - more - - Microchip Technology Reports
Microchip Technology Inc. is a broadline supplier of semiconductors committed to making innovative design easier through total system solutions that address critical challenges at the intersection of emerging technologies and durable end markets. Its easy-to-use development tools and comprehensive product portfolio support customers throughout the design process, from concept to completion. Headquartered in Chandler, Arizona, Microchip offers outstanding technical support and delivers solutions across the industrial, automotive, consumer, aerospace and defense, communications and computing markets. For more information, visit the Microchip website at www.microchip.com .
Note: The Microchip name and logo are registered trademarks of Microchip Technology Incorporated in the U.S.A. and other countries. All other trademarks mentioned herein are the property of their respective companies. - - end - -
Full text with the tables
EXHIBIT 99.1
NEWS RELEASE
INVESTOR RELATIONS CONTACT:
Sajid Daudi -- Head of Investor Relations..... (480) 792-7385
MICROCHIP TECHNOLOGY ANNOUNCES FINANCIAL RESULTS FOR
SECOND QUARTER OF FISCAL YEAR 2027
•
Net sales of $1.622 billion, increased
42.2%
from the year-ago quarter and up 9.2%
sequentially. The midpoint of our guidance provided on August 6, 2026 was net
sales of $1.604 billion.
•
On a GAAP basis: gross profit of 65.9%; operating income of $464.5 million and
28.6% of net sales; net income attributable to common stockholders of $373.6
million; and EPS of $0.68 per diluted share. Our guidance provided on August 6,
2026 was GAAP EPS per diluted share of $0.53 to $0.54.
•
On a Non-GAAP basis: gross profit of 66.5%; operating income of $639.9 million
and 39.5% of net sales; net income of $559.2 million; and EPS of $0.97 per
diluted share. Our guidance provided on August 6, 2026 was Non-GAAP EPS per
diluted share of $0.91 to $0.95.
•
Returned approximately $247.6 million to common stockholders in the September
quarter through dividends.
•
Quarterly dividend on common stock declared for the December quarter of 45.5
cents per share.
•
Completed acquisitions of Hailo, a provider of accelerated edge AI processors,
on September 17th, and Vorago Technologies, a provider of radiation-hardened
microcontrollers and microprocessors, on October 8th.
CHANDLER, Arizona - November 5, 2026 - (NASDAQ: MCHP) - Microchip Technology
Incorporated, a broadline supplier of semiconductors committed to making
innovative design easier through total system solutions, today reported results
for the three months ended September 30, 2026.
"Our September quarter net sales were above the high end of our guidance,
increasing 42.2% year over year and 9.2% sequentially to $1.622 billion," said
Steve Sanghi, Microchip’s President and Chief Executive Officer. "The momentum
from the start of fiscal 2027 continued in the September quarter, with broad-
based growth across our end markets, driven by industrial and data center
applications. Our growth is increasingly supported by new design wins and
product innovations, which we believe positions us well for the opportunities
ahead."
- - more - -
Microchip Technology Incorporated 2355 West Chandler Blvd. Chandler, AZ
85224-6199 Main Office 480•792•7200
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 2
Mr. Sanghi added, “Bookings remained robust, with book-to-bill well above one,
consistent with recent quarters. We are winning new designs across our end
markets, including data center, where our PCIe Gen6 switch and retimer design
wins have grown to 24 to date, up from 12 at the end of the June quarter. We
also broadened our portfolio, with a steady cadence of product and technology
introductions across data center, aerospace and defense, automotive and
industrial applications, which expands the foundation for future design wins."
Eric Bjornholt, Microchip's Corporate Senior Vice President and Chief Financial
Officer, said, "Our September quarter results reflect ongoing operational
improvements, with non-GAAP operating expenses growing well below net sales and
supporting higher profitability. We believe our existing manufacturing footprint
enables us to grow with modest incremental capital investment, and we remain
focused on strengthening our balance sheet while making targeted investments
that accelerate our product roadmap.”
Mr. Sanghi concluded, “As we enter the December quarter, we are experiencing
some normal seasonal factors in our business. Normal seasonality is for our
revenue to be down sequentially 3% to 5% in the December quarter. We expect net
sales for the December quarter to be between down 3% and up 1% sequentially,
with a midpoint of down 1%. The midpoint of our December quarter guidance
represents year-over-year growth of approximately 35.4%. Our guidance of down 1%
at the midpoint needs to be considered with the fact that we had about $53
million of infrequent revenue items in the September quarter which do not repeat
in the December quarter. Taking this into consideration, the midpoint of our
guidance for the December quarter represents guidance that is 5% to 7% better
than normal seasonality. Lead times are lengthening across our supply chain, and
we are working to expand capacity and secure additional wafer allocation. We
expect non-GAAP gross margin to be between 64% and 65% and GAAP gross margin to
be between 62.9% and 63.9%. Together, data center, aerospace and defense,
industrials, robotics, automotive and the intelligent edge are the secular
trends we see driving growth over the long-term.”
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 3
The following table summarizes Microchip's reported results for the three months
ended September 30, 2026.
Three Months Ended
September 30,
2026(1)
Net sales $1,621.5
GAAP % Non-GAAP(2) %
Gross profit $1,068.0 65.9% $1,077.8 66.5%
Operating income $464.5 28.6% $639.9 39.5%
Other expense $(47.0) $(47.0)
Income tax $16.1 $33.7
provision
Net income $401.4 $559.2
Dividends on Series $(27.8) —
A Preferred Stock
Net income
attributable to $373.6 23.0% $559.2 34.5%
common
stockholders
Diluted net income $0.68 $0.97
per common share
(1) In millions, except per share amounts and percentages of net sales.
(2) See the "Use of Non-GAAP Financial Measures" section of this release.
Net sales for the second quarter of fiscal 2027 were $1.622 billion, up 42.2%
from net sales of $1.140 billion in the prior year's second fiscal quarter.
GAAP net income attributable to common stockholders for the second quarter of
fiscal 2027 was $373.6 million, or $0.68 per diluted share, up from GAAP net
income attributable to common stockholders of $13.9 million, or $0.03 per
diluted share, in the prior year's second fiscal quarter. For the second
quarters of fiscal 2027 and fiscal 2026, GAAP results were adversely impacted by
amortization of acquired intangible assets associated with our previous
acquisitions.
Non-GAAP net income for the second quarter of fiscal 2027 was $559.2 million, or
$0.97 per diluted share, up from non-GAAP net income of $199.1 million, or $0.35
per diluted share, in the prior year's second fiscal quarter. For the second
quarters of fiscal 2027 and fiscal 2026, our non-GAAP results exclude the effect
of share-based compensation, restructuring charges, expenses related to our
acquisition activities (including intangible asset amortization, severance,
other restructuring costs, and legal and other general and administrative
expenses including legal fees and expenses for litigation related to our
Microsemi acquisition), professional services associated with certain legal
matters, (gain) loss on available-for-sale investments, and dividends on our
Series A Mandatory Convertible Preferred Stock. For the second quarters of
fiscal 2027 and fiscal 2026, our non-GAAP income tax expense is presented based
on projected cash taxes for the applicable fiscal year, excluding transition tax
payments under the Tax Cuts and Jobs Act. A reconciliation of our non-GAAP and
GAAP results is included in this press release.
Microchip announced today that its Board of Directors declared a quarterly cash
dividend on its common stock of 45.5 cents per share, which is payable on
December 8, 2026 to stockholders of record on November 23, 2026. Our Board also
declared a quarterly cash dividend on Microchip's 7.50% Series A Mandatory
Convertible Preferred Stock of $18.750 per share (which represents $0.9375 per
depositary share) which is payable on December 15, 2026 to stockholders of
record on December 1, 2026.
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 4
Microchip also announced that, on November 3, 2026, Victor Peng informed our
Board of Directors of his decision to step down from the Board due to his time
commitments on other matters including serving as Chief Executive Officer of
PsiQuantum. The Board thanks Mr. Peng for his service and contributions during
his tenure on the Board.
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 5
Third Quarter Fiscal Year 2027 Outlook:
The following statements are based on current expectations. These statements are
forward-looking, and actual results may differ materially.
Microchip
Consolidated
Guidance
Net Sales $1.573 to $1.638
billion
GAAP(5) Non-GAAP Non-GAAP(1)
Adjustments(1)
Gross Profit 62.9% to 63.9% $17.7 to $18.7 64.0% to 65.0%
million
Operating 36.7% to 37.4% $163.0 to $167.0 26.5% to 27.0%
Expenses(2) million
Operating 25.5% to 27.2% $180.8 to $185.8 37.0% to 38.5%
Income million
Other Expense, $47.7 to $48.3 $(0.2) to $0.2 $47.5 to $48.5
net million million million
Income Tax $67.1 to $91.3 $(53.4) to $34.7 to $37.9
Provision million(3) $(32.4) million million(4)
Net income $285.9 to $305.8 $212.9 to $239.3 $498.8 to $545.1
million million million
Dividends on
Series A $(27.8) million $27.8 million —
Preferred Stock
Net income
attributable to $258.1 to $278.0 $240.7 to $267.1 $498.8 to $545.1
common million million million
stockholders
Diluted Common Approximately 23.8 million Approximately
Shares 551.0 to 552.0 shares 574.8 to 575.8
Outstanding million shares million shares
Diluted net
income per $0.47 to $0.50 $0.40 to $0.45 $0.87 to $0.95
common share
(1) See the "Use of Non-GAAP Financial Measures" section of this release for
information regarding our non-GAAP guidance.
(2) We are not able to estimate the amount of certain Special Charges and Other,
net that may be incurred during the quarter ending December 31, 2026. Therefore,
our estimate of GAAP operating expenses excludes certain amounts that may be
recognized as Special Charges and Other, net in the quarter ending December 31,
2026.
(3) The forecast for GAAP tax expense excludes any unexpected tax events that
may occur during the quarter, as these amounts cannot be forecasted.
(4) Represents the expected cash tax rate for fiscal 2027, excluding any
transition tax payments associated with the Tax Cuts and Jobs Act.
(5) Our GAAP guidance excludes the impact of any potential gains or charges
related to our ongoing evaluation of restructuring activities including the sale
of our Fab 2 wafer fabrication facility in Tempe, Arizona.
Capital expenditures for the quarter ending December 31, 2026 are expected to be
about $35 million. Capital expenditures for all of fiscal 2027 are expected to
be approximately $100 million. Consistent with the slow macroeconomic
environment in fiscal 2025, we have paused most of our factory expansion actions
and reduced our planned capital investments through fiscal 2027. However, we are
adding capital equipment to selectively expand our production capacity and add
research and development equipment.
Under the GAAP revenue recognition standard, we are required to recognize
revenue when control of the product changes from us to a customer or
distributor. We focus our sales and marketing efforts on creating demand for our
products in the end markets we serve and not on moving inventory into our
distribution network. We also manage our manufacturing and supply chain
operations, including our distributor relationships, towards the goal of having
our products available at the time and location the end customer desires.
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 6
Use of Non-GAAP Financial Measures: Our non-GAAP adjustments, where applicable,
include the effect of share-based compensation, restructuring charges, expenses
related to our acquisition activities (including intangible asset amortization,
severance, other restructuring costs, and legal and other general and
administrative expenses including legal fees and expenses for litigation related
to our Microsemi acquisition), professional services associated with certain
legal matters, (gain) loss on available-for-sale investments, and dividends on
our Series A Mandatory Convertible Preferred Stock. For the second quarters of
fiscal 2027 and fiscal 2026, our non-GAAP income tax expense is presented based
on projected cash taxes for the fiscal year, excluding transition tax payments
under the Tax Cuts and Jobs Act.
We are required to estimate the cost of certain forms of share-based
compensation, including restricted stock units and our employee stock purchase
plan, and to record a commensurate expense in our income statement. Share-based
compensation expense is a non-cash expense that varies in amount from period to
period and is affected by the price of our stock at the date of grant. The price
of our stock is affected by market forces that are difficult to predict and are
not within the control of management. Our other non-GAAP adjustments are either
non-cash expenses, unusual or infrequent items, or other expenses related to
transactions. Management excludes all of these items from its internal operating
forecasts and models.
We are using non-GAAP operating expenses in dollars, including non-GAAP research
and development expenses and non-GAAP selling, general and administrative
expenses, non-GAAP other expense, net, and non-GAAP income tax rate, which
exclude the items noted above, as applicable, to permit additional analysis of
our performance.
Management believes these non-GAAP measures are useful to investors because they
enhance the understanding of our historical financial performance and
comparability between periods. Many of our investors have requested that we
disclose this non-GAAP information because they believe it is useful in
understanding our performance as it excludes non-cash and other charges that
many investors feel may obscure our underlying operating results. Management
uses non-GAAP measures to manage and assess the profitability of our business
and for compensation purposes. We also use our non-GAAP results when developing
and monitoring our budgets and spending. Our determination of these non-GAAP
measures might not be the same as similarly titled measures used by other
companies, and it should not be construed as a substitute for amounts determined
in accordance with GAAP. There are limitations associated with using these non-
GAAP measures, including that they exclude financial information that some may
consider important in evaluating our performance. Management compensates for
this by presenting information on both a GAAP and non-GAAP basis for investors
and providing reconciliations of the GAAP and non-GAAP results.
Generally, gross profit fluctuates over time, driven primarily by the mix of
products sold and licensing revenue; variances in manufacturing yields; fixed
cost absorption; wafer fab loading levels; costs of wafers from foundries;
inventory reserves; pricing pressures in our non-proprietary product lines; and
competitive and economic conditions. Operating expenses fluctuate over time,
primarily due to net sales and profit levels.
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 7
Diluted Common Shares Outstanding can vary for, among other things, the trading
price of our common stock, the vesting of restricted stock units, the potential
for incremental dilutive shares from our convertible debentures and our
mandatory convertible preferred stock (additional information regarding our
share count is available in the investor relations section of our website under
the heading "Supplemental Information"), and repurchases or issuances of shares
of our common stock. The diluted common shares outstanding presented in the
guidance table above assumes an average Microchip stock price in the December
2026 quarter between $75 and $85 per share (however, we make no prediction as to
what our actual share price will be for such period or any other period).
- - more - -
Page 8
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts, unaudited)
Three Six
Months Months
Ended Ended
Septemb… Septem…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Net $ 1,621.5 $ 1,140.4 $ 3,106.2 $ 2,215.9
sales
Cost of 553.5 502.5 1,099.3 1,001.3
sales
Gross 1,068.0 637.9 2,006.9 1,214.6
profit
Resear…
and 318.5 262.3 627.4 517.8
develo…
Sellin…
general 186.9 172.3 371.2 331.6
and
admini…
Amorti…
of
acquir… 90.2 108.1 180.2 215.7
intang…
assets
Special
charges
and 7.9 6.3 26.8 28.5
other,
net
Operat… 603.5 549.0 1,205.6 1,093.6
expens…
Operat… 464.5 88.9 801.3 121.0
income
Other
expens… -47.0 -57.1 -93.9 -105.0
net
Income
before 417.5 31.8 707.4 16.0
income
taxes
Income
tax 16.1 -9.9 76.2 -7.1
provis…
(benef…
Net 401.4 41.7 631.2 23.1
income
Divide…
on
Series -27.8 -27.8 -55.6 -55.6
A
Prefer…
Stock
Net
income
(loss)
attrib… $ 373.6 $ 13.9 $ 575.6 $ -32.5
to
common
stockh…
Basic
net
income
(loss) $ 0.69 $ 0.03 $ 1.06 $ -0.06
per
common
share
Diluted
net
income
(loss) $ 0.68 $ 0.03 $ 1.05 $ -0.06
per
common
share
Basic
common 543.6 540.0 543.1 539.6
shares
outsta…
Diluted
common 550.6 545.0 550.6 539.6
shares
outsta…
- - more - -
Page 9
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, unaudited)
ASSETS 2026 September 30, 2026 March 31,
──────────────────────────────────────────────────────────────────────────────
Cash and short-term investments $ 457.0 $ 240.3
Accounts receivable, net 963.1 894.7
Inventories 1,117.3 1,035.4
Other current assets 208.9 207.2
Total current assets 2,746.3 2,377.6
Property, plant and equipment, net 1,074.3 1,106.7
Other assets 10,839.8 10,885.8
Total assets $ 14,660.4 $ 14,370.1
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable and accrued $ 1,224.7 $ 1,136.3
liabilities
Total current liabilities 1,224.7 1,136.3
Long-term debt 5,517.2 5,496.4
Long-term income tax payable 592.8 570.9
Long-term deferred tax liability 24.1 25.1
Other long-term liabilities 660.8 709.0
Stockholders' equity 6,640.8 6,432.4
Total liabilities and
stockholders' $ 14,660.4 $ 14,370.1
equity
- - more - -
Page 10
MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(in millions, except per share amounts and percentages; unaudited)
RECONCILIATION OF GAAP GROSS PROFIT TO NON-GAAP GROSS PROFIT
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Gro…
pro… $ 1,06… $ 637.9 $ 2,00… $ 1,21…
as
rep…
Sha…
com… 9.8 8.3 18.5 16.0
exp…
Non…
gro… $ 1,07… $ 646.2 $ 2,02… $ 1,23…
pro…
GAAP
gro… 65.9 % 55.9 % 64.6 % 54.8 %
pro…
per…
Non…
gro… 66.5 % 56.7 % 65.2 % 55.5 %
pro…
per…
RECONCILIATION OF GAAP RESEARCH AND DEVELOPMENT EXPENSES TO NON-GAAP
RESEARCH AND DEVELOPMENT EXPENSES
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Res…
and
dev… $ 318.5 $ 262.3 $ 627.4 $ 517.8
exp…
as
rep…
Sha…
com… -39.5 -33.2 -80.6 -62.3
exp…
Oth… -4.5 — -4.5 —
adj…
Non…
res…
and $ 274.5 $ 229.1 $ 542.3 $ 455.5
dev…
exp…
GAAP
res…
and
dev…
exp… 19.6 % 23.0 % 20.2 % 23.4 %
as a
per…
of
net
sal…
Non…
res…
and
dev…
exp… 16.9 % 20.1 % 17.5 % 20.6 %
as a
per…
of
net
sal…
RECONCILIATION OF GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSES TO NON-GAAP
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Sel…
gen…
and
adm… $ 186.9 $ 172.3 $ 371.2 $ 331.6
exp…
as
rep…
Sha…
com… -22.7 -20.1 -47.9 -36.2
exp…
Oth… -0.8 — -0.8 —
adj…
Pro…
ser…
ass…
with — -12.3 -0.4 -19.8
cer…
leg…
mat…
Non…
sel…
gen… $ 163.4 $ 139.9 $ 322.1 $ 275.6
and
adm…
exp…
GAAP
sel…
gen…
and
adm…
exp… 11.5 % 15.1 % 12.0 % 15.0 %
as a
per…
of
net
sal…
Non…
sel…
gen…
and
adm…
exp… 10.1 % 12.3 % 10.4 % 12.4 %
as a
per…
of
net
sal…
- - more - -
Page 11
RECONCILIATION OF GAAP OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Ope…
exp… $ 603.5 $ 549.0 $ 1,20… $ 1,09…
as
rep…
Sha…
com… -62.2 -53.3 -128… -98.5
exp…
Oth… -5.3 — -5.3 —
adj…
Pro…
ser…
ass…
with — -12.3 -0.4 -19.8
cer…
leg…
mat…
Amo…
of
acq… -90.2 -108… -180… -215…
int…
ass…
Spe…
cha…
and -7.9 -6.3 -26.8 -28.5
oth…
net
Non…
ope… $ 437.9 $ 369.0 $ 864.4 $ 731.1
exp…
GAAP
ope…
exp…
as a 37.2 % 48.1 % 38.8 % 49.4 %
per…
of
net
sal…
Non…
ope…
exp…
as a 27.0 % 32.4 % 27.8 % 33.0 %
per…
of
net
sal…
(1) Amortization of acquired intangible assets consists of core and developed
technology and customer-related acquired intangible assets in connection with
business combinations. Such charges are excluded for purposes of calculating
certain non-GAAP measures.
RECONCILIATION OF GAAP OPERATING INCOME TO NON-GAAP OPERATING INCOME
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Ope…
inc… $ 464.5 $ 88.9 $ 801.3 $ 121.0
as
rep…
Sha…
com… 72.0 61.6 147.0 114.5
exp…
Oth… 5.3 — 5.3 —
adj…
Pro…
ser…
ass…
with — 12.3 0.4 19.8
cer…
leg…
mat…
Amo…
of
acq… 90.2 108.1 180.2 215.7
int…
ass…
Spe…
cha…
and 7.9 6.3 26.8 28.5
oth…
net
Non…
ope… $ 639.9 $ 277.2 $ 1,16… $ 499.5
inc…
GAAP
ope…
inc…
as a 28.6 % 7.8 % 25.8 % 5.5 %
per…
of
net
sal…
Non…
ope…
inc…
as a 39.5 % 24.3 % 37.4 % 22.5 %
per…
of
net
sal…
(1) Amortization of acquired intangible assets consists of core and developed
technology and customer-related acquired intangible assets in connection with
business combinations. Such charges are excluded for purposes of calculating
certain non-GAAP measures. The use of acquired intangible assets contributed to
our revenues earned during the periods presented.
- - more - -
Page 12
RECONCILIATION OF GAAP OTHER EXPENSE, NET TO NON-GAAP OTHER EXPENSE, NET
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Oth…
exp…
net, $ -47.0 $ -57.1 $ -93.9 $ -105…
as
rep…
(Ga…
loss
on — -0.1 — -0.1
ava…
inv…
Non…
oth… $ -47.0 $ -57.2 $ -93.9 $ -105…
exp…
net
GAAP
oth…
exp…
net,
as a -2.9 % -5.0 % -3.0 % -4.7 %
per…
of
net
sal…
Non…
oth…
exp…
net,
as a -2.9 % -5.0 % -3.0 % -4.7 %
per…
of
net
sal…
RECONCILIATION OF GAAP INCOME TAX PROVISION (BENEFIT) TO NON-GAAP INCOME TAX
PROVISION
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Inc…
tax
pro… $ 16.1 $ -9.9 $ 76.2 $ -7.1
(be…
as
rep…
Inc…
tax
rat… 3.9 % -31.1 % 10.8 % -44.4 %
as
rep…
Oth…
non… 17.6 30.8 -6.9 47.7
tax
adj…
Non…
inc… $ 33.7 $ 20.9 $ 69.3 $ 40.6
tax
pro…
Non…
inc… 5.7 % 9.5 % 6.5 % 10.3 %
tax
rate
RECONCILIATION OF GAAP NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS AND
GAAP DILUTED NET INCOME (LOSS) PER COMMON SHARE TO NON-GAAP NET INCOME AND NON-
GAAP DILUTED NET INCOME PER COMMON SHARE
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Net
inc…
(lo…
att…
to $ 373.6 $ 13.9 $ 575.6 $ -32.5
com…
sto…
as
rep…
Div…
on
Ser… 27.8 27.8 55.6 55.6
A
Pre…
Sto…
Sha…
com… 72.0 61.6 147.0 114.5
exp…
Oth… 5.3 — 5.3 —
adj…
Pro…
ser…
ass…
with — 12.3 0.4 19.8
cer…
leg…
mat…
Amo…
of
acq… 90.2 108.1 180.2 215.7
int…
ass…
Spe…
cha…
and 7.9 6.3 26.8 28.5
oth…
net
(Ga…
loss
on — -0.1 — -0.1
ava…
inv…
Oth…
non… -17.6 -30.8 6.9 -47.7
tax
adj…
Non…
net $ 559.2 $ 199.1 $ 997.8 $ 353.8
inc…
GAAP
net
inc…
(lo…
att…
to
com… 23.0 % 1.2 % 18.5 % -1.5 %
sto…
as a
per…
of
net
sal…
Non…
net
inc…
as a 34.5 % 17.5 % 32.1 % 16.0 %
per…
of
net
sal…
Dil…
net
inc…
(lo…
per $ 0.68 $ 0.03 $ 1.05 $ -0.06
com…
sha…
as
rep…
Non…
dil…
net
inc… $ 0.97 $ 0.35 $ 1.74 $ 0.62
per
com…
sha…
Dil…
com…
sha… 550.6 545.0 550.6 539.6
out…
as
rep…
Dil…
com…
sha… 574.4 568.8 574.4 569.2
out…
non…
- - more - -
Page 13
RECONCILIATION OF GAAP DILUTED COMMON SHARES OUTSTANDING TO NON-GAAP
DILUTED COMMON SHARES OUTSTANDING
Three Six
Months Months
Ended Ended
Septemb… September
30, 30,
2026 2025 2026 2025
Diluted
common
shares 550.6 545.0 550.6 539.6
outsta…
as
report…
Diluti…
effect — — — 3.8
of
RSUs(1)
Diluti…
effect
of 2017 — — — 0.4
Senior
Conver…
Debt(1)
Diluti…
effect
of
Series 23.8 23.8 23.8 25.4
A
Prefer…
Stock(…
Diluted
common
shares 574.4 568.8 574.4 569.2
outsta…
non-GA…
(1) The non-GAAP adjustment includes the impact that is anti-dilutive on a GAAP
basis for the periods shown in the table above.
RECONCILIATION OF GAAP CASH FLOW FROM OPERATIONS TO FREE CASH FLOW
Three Six
Mont… Mont…
Ended Ended
Sept… Sept…
2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
GAAP
cash
flow
from $ 419.2 $ 88.1 $ 930.7 $ 363.7
ope…
as
rep…
Cap… -23.1 -36.5 -37.0 -54.4
exp…
Free
cash $ 396.1 $ 51.6 $ 893.7 $ 309.3
flow
GAAP
cash
flow
from
ope… 25.9 % 7.7 % 30.0 % 16.4 %
as a
per…
of
net
sal…
Free
cash
flow
as a 24.4 % 4.5 % 28.8 % 14.0 %
per…
of
net
sal…
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 14
Microchip will host a conference call today, November 5, 2026 at 5:00 p.m.
(Eastern Time) to discuss this release. This call will be simulcast over the
Internet at www.microchip.com . The webcast will be available for replay until
December 3, 2026.
A telephonic replay of the conference call will be available at approximately
8:00 p.m. (Eastern Time) on November 5, 2026 and will remain available until
5:00 p.m. (Eastern Time) on December 3, 2026. Interested parties may listen to
the replay by dialing 201-612-7415/877-660-6853 and entering access code
13761638.
Cautionary Statement:
The statements in this release relating to the momentum from the start of fiscal
2027, broad-based growth across our end markets driven by industrial and data
center applications, growth being increasingly supported by new design wins and
product innovations which we believe positions us well for the opportunities
ahead, that we are winning new designs across our end markets, that we have a
steady cadence of product and technology introductions across data center,
aerospace and defense, automotive and industrial applications which expands the
foundation for future design wins, ongoing operational improvements with non-
GAAP operating expenses growing well below net sales and supporting higher
profitability, that we believe our existing manufacturing footprint enables us
to grow with modest incremental capital investment, that we remain focused on
strengthening our balance sheet while making targeted investments that
accelerate our product roadmap, that we are experiencing some normal seasonal
factors in our business, normal seasonality is for our revenue to be down
sequentially 3% to 5% in the December quarter, that we expect net sales for the
December quarter to be between down 3% and up 1% sequentially, with a midpoint
of down 1%, that the midpoint of our December quarter guidance represents year-
over-year growth of approximately 35.4%, that the infrequent revenue items in
the September quarter do not repeat in the December quarter, that the midpoint
of our guidance for the December quarter represents guidance that is 5% to 7%
better than normal seasonality, that lead times are lengthening across our
supply chain, that we are working to expand capacity and secure additional wafer
allocation, that we expect non-GAAP gross margin to be between 64% and 65% and
GAAP gross margin to be between 62.9% and 63.9%, that together, data center,
aerospace and defense, industrials, robotics, automotive and the intelligent
edge are the secular trends we see driving growth over the long-term, our third
quarter fiscal 2027 guidance for net sales and GAAP and non-GAAP gross profit,
operating expenses, operating income, other expense, net, income tax provision,
net income, dividends on Series A Preferred Stock, net income attributable to
common stockholders, diluted common shares outstanding, diluted net income per
common share, capital expenditures for the December 2026 quarter and for all of
fiscal 2027, adding capital equipment to selectively expand our production
capacity and add research and development equipment, our belief that non-GAAP
measures are useful to investors and our assumed average stock price in the
December 2026 quarter are forward-looking statements made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. These
statements involve risks and uncertainties that could cause our actual results
to differ materially, including, but not limited to: any continued uncertainty,
fluctuations or weakness in the U.S. and world economies (including China and
Europe) due to changes in interest rates or high inflation, actions taken or
which may be taken by the Trump administration or the U.S. Congress, the impact
of the November elections in the U.S., monetary policy, political, geopolitical,
trade or other issues in the U.S. or internationally (including the military
conflicts in the Middle East and Ukraine-Russia), the scope and level of
tariffs; further changes in demand or market acceptance of our products and the
products of our customers
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 15
and our ability to respond to any increases or decreases in market demand or
customer requests to increase orders or reschedule or cancel orders; the mix of
inventory we hold, our ability to satisfy any short-term orders from our
inventory and our ability to effectively manage our inventory levels; changes or
fluctuations in customer order patterns and seasonality; changes in utilization
of our manufacturing capacity and our ability to effectively manage our
production levels to meet any increases or decreases in market demand or any
customer requests to reschedule or cancel orders; the impact of inflation on our
business; competitive developments including pricing pressures; the level of
orders that are received and can be shipped in a quarter; our ability to realize
the expected benefits of our long-term supply assurance program; our ability to
effectively manage our supply of wafers from third party wafer foundries to meet
any increases or decreases in our needs and the cost of such wafers, our ability
to obtain additional capacity from our suppliers to increase production to meet
any future increases in market demand; our ability to successfully integrate the
operations and employees, retain key employees and customers and otherwise
realize the expected synergies and benefits of our acquisitions; the impact of
any future significant acquisitions or strategic transactions we may make; the
costs and outcome of any current or future litigation or other matters involving
our acquisitions (including the acquired business, intellectual property,
customers, or other issues); foreign currency effects on our business; the costs
and outcome of any current or future tax audit or investigation regarding our
business or our acquired businesses; the impact that the CHIPS Act will have on
increasing manufacturing capacity in our industry by providing incentives for
us, our competitors and foundries to build new wafer manufacturing facilities or
expand existing facilities; the amount and timing of any incentives we may
receive under the CHIPS Act, the impact of current and future changes in U.S.
corporate tax laws (including the One Big Beautiful Bill Act, the Inflation
Reduction Act of 2022 and the Tax Cuts and Jobs Act of 2017); fluctuations in
our stock price and trading volume which could impact the number of shares we
acquire under our share repurchase program and the timing of such repurchases;
disruptions in our business or the businesses of our customers or suppliers due
to natural disasters (including any floods in Thailand), terrorist activity,
armed conflict, war, worldwide oil prices and supply, public health concerns or
disruptions in the transportation system; and general economic, industry or
political conditions in the United States or internationally.
For a detailed discussion of these and other risk factors, please refer to
Microchip's filings on Forms 10-K and 10-Q. You can obtain copies of Forms 10-K
and 10-Q and other relevant documents for free at Microchip's website (
www.microchip.com ) or the SEC's website ( www.sec.gov ) or from commercial
document retrieval services.
Stockholders of Microchip are cautioned not to place undue reliance on our
forward-looking statements, which speak only as of the date such statements are
made. Microchip does not undertake any obligation to publicly update any
forward-looking statements to reflect events, circumstances or new information
after this November 5, 2026 press release, or to reflect the occurrence of
unanticipated events.
- - more - -
Microchip Technology Reports
Second Quarter Fiscal 2027
Financial Results
Page 16
About Microchip:
Microchip Technology Inc. is a broadline supplier of semiconductors committed to
making innovative design easier through total system solutions that address
critical challenges at the intersection of emerging technologies and durable end
markets. Its easy-to-use development tools and comprehensive product portfolio
support customers throughout the design process, from concept to completion.
Headquartered in Chandler, Arizona, Microchip offers outstanding technical
support and delivers solutions across the industrial, automotive, consumer,
aerospace and defense, communications and computing markets. For more
information, visit the Microchip website at www.microchip.com .
Note: The Microchip name and logo are registered trademarks of Microchip
Technology Incorporated in the U.S.A. and other countries. All other trademarks
mentioned herein are the property of their respective companies.
- - end - -