Microchip Technology Q2 2027: Six Straight EPS Beats, but Guidance Clouds the Picture
As seen on the 24/7 Wall St. homepage on November 5, 2026.
The December quarter guidance midpoint lands below consensus, partly because roughly $53 million of infrequent September revenue does not repeat. That overshadowed a sixth straight EPS beat and non-GAAP gross margin of 66.5%.
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Microchip Technology reported adjusted EPS of $0.97 for its fiscal second quarter of 2027, beating the consensus estimate of $0.94. That extended the company's streak of topping analyst EPS expectations to six consecutive quarters, a run that stretches back to Q4 2025 when it reported $0.11 against an estimate of $0.10.
Net sales of $1.62 billion beat consensus and rose 42.2% from the same quarter a year earlier. CEO Steve Sanghi attributed the result to broad-based growth across industrial and data center end markets, and the company reported that PCIe Gen6 switch and retimer design wins doubled to 24 during the quarter.
Non-GAAP gross margin widened to 66.5% from 56.7% a year earlier, with operating margin also expanding. The quarter included the completed acquisitions of Hailo, an edge AI processor maker, and Vorago Technologies, a radiation-hardened chip specialist.
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The December quarter outlook put a shadow over the results. Microchip guided net sales of $1.573 billion to $1.638 billion, a midpoint that trailed consensus, and shares slipped on the news. Sanghi said infrequent September quarter revenue items will not repeat, leaving the guidance midpoint better than normal seasonality.
For the December quarter, the company also guided non-GAAP diluted EPS of $0.87 to $0.95 and said lead times are lengthening across its supply chain as it works to expand capacity and secure additional wafer allocation. A quarterly cash dividend of $0.455 per common share is set for payment on December 8, with a record date of November 23.