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Microchip Technology Announces Financial Results for First Quarter of Fiscal Year 2027

MCHP
  • Microchip Technology reported net sales of $1.485 billion for the quarter ended June 30, 2026, representing a 38.0% year-over-year increase & a 13.2% sequential increase.
  • GAAP results included gross profit of 63.2%, operating income of $336.8 million (22.7% of sales), net income attributable to common stockholders of $202.0 million, & diluted EPS of $0.37.
  • Non-GAAP results showed gross profit of 63.8%, operating income of $521.1 million (35.1% of sales), net income of $438.6 million, & diluted EPS of $0.76.
  • Both GAAP & Non-GAAP EPS figures exceeded the company's previous guidance range provided on May 7, 2026.
  • The company returned approximately $246.9 million to common stockholders via dividends during the quarter.
  • A quarterly dividend of 45.5 cents per share on common stock was declared for the September quarter, payable on September 9, 2026.
  • The company also declared a quarterly dividend of $18.750 per share on its 7.50% Series A Mandatory Convertible Preferred Stock, payable on September 15, 2026.
  • Net debt was reduced by approximately $170 million during the quarter as part of continued balance sheet deleveraging.
  • Inventory days declined from 185 days at the end of March to 175 days at the end of June.
  • PCIe Gen6 connectivity design wins doubled sequentially from six programs to 12 programs.
  • Management expects net sales for the September quarter to increase sequentially by 7% to 9%, with a midpoint implying approximately 40.6% year-over-year growth.
  • Second quarter fiscal 2027 guidance projects net sales between $1.589 billion & $1.618 billion.
  • Fiscal 2027 guidance for Non-GAAP diluted EPS is set between $0.91 & $0.95.
  • Capital expenditures for the September quarter are expected to range from $20 million to $25 million.
  • Total capital expenditures for all of fiscal 2027 are anticipated to be approximately $100 million.
  • The company has paused most factory expansion actions but continues to add capital equipment for selective production capacity expansion & research and development.