Microchip Technology Inc
Q4 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: −1.65%.
Did MCHP Beat Earnings? Q4 2026 Results
Microchip Technology closed fiscal year 2026 on a strong note, posting fourth-quarter revenue of $1.31 billion and non-GAAP EPS of $0.57, both ahead of the company's own guidance and extending what is now a four-consecutive-quarter streak of beating consensus EPS estimates. Revenue grew 35.1% year over year, clearing the guidance midpoint of $1.26 billion by 3.78%, as broad-based demand recovery combined with disciplined inventory reduction gave management meaningful operating leverage to work with. The most material driver was the company's ongoing nine-point recovery plan; distributor inventory fell to just 26 days, near the low end of historical norms, while total inventory was trimmed by $22.30 million in the quarter alone. Growing institutional confidence has tracked the operational turnaround, with at least one major asset manager significantly enlarging its MCHP stake in recent months. Looking ahead, Microchip guided Q1 fiscal 2027 net sales of $1.44 billion to $1.47 billion, up roughly 35.3% year over year, with non-GAAP EPS of $0.67 to $0.71, signaling continued momentum as booking activity strengthens heading into the seasonally favorable June quarter.
- Broad-based improvement across product lines with 35.1% YoY and 10.6% sequential revenue growth
- Disciplined inventory reduction — $320.9 million reduced from December 2024 peak, days of inventory down from 201 to 185
- Distributor inventory declined to 26 days, near low end of historical range
- Meaningful operating leverage from disciplined execution against nine-point recovery plan
- Improving booking and sell-through trends with strong expedite activity
- Non-GAAP operating margin expanded to 30.6% from 14.0% in the year-ago quarter
“Our March quarter results significantly exceeded our expectations, with revenue of $1.311 billion coming in above the high end of our guidance and increasing 10.6% sequentially and 35.1% year over year, reflecting broad‑based improvement across Microchip's business. We ended the fiscal year with strong momentum, representing meaningful progress from the challenging conditions we were navigating just a few quarters ago. As demand conditions have improved and customer inventory has normalized, we are seeing increasing momentum across our product lines, improving booking and sell‑through trends, strong expedite activity, and meaningful operating leverage, reflecting disciplined execution against our nine‑point recovery plan.”
Microchip Technology CEO, on the earnings call
Forward Guidance & Outlook
For Q1 fiscal 2027 (June 2026 quarter), Microchip guided net sales of $1.442 billion to $1.469 billion, up approximately 35.3% year over year and 11% sequentially at the midpoint. Non-GAAP gross margin is expected at 62.25% to 63.25%, non-GAAP operating expenses at 28.75% to 29.25% of sales, non-GAAP operating profit at 33.00% to 34.50%, and non-GAAP EPS of $0.67 to $0.71. GAAP EPS is guided at $0.28 to $0.29. Capital expenditures are expected at approximately $20 million for Q1 and approximately $100 million for all of fiscal 2027. The company is ramping front-end and back-end factories as inventory corrects toward longer-term targets, and sees continued strengthening in booking activity and improved visibility heading into the seasonally stronger June and September quarters.
MCHP YoY Financials
Figures from SEC filings and company reports. Not investment advice.