Overview

* Microchip Q2 sales of $1.14 bln meet analyst expectations, up 6% sequentially

* Adjusted EPS for Q2 beats analyst expectations at $0.35

* Company returned $245.8 mln to shareholders through dividends in Q2

Outlook

* Microchip expects Q3 net sales of $1.109 bln to $1.149 bln

* Company anticipates Q3 GAAP gross profit margin of 56.2% to 58.1%

* Capital expenditures for Q3 expected between $15 mln and $25 mln

Result Drivers

* OPERATIONAL IMPROVEMENTS - CEO Steve Sanghi attributes sequential sales growth to operational improvements and strategic initiatives

* MARKET DEMAND - Co sees strong customer engagement in data center and aerospace markets, driving demand for integrated solutions

* TECHNOLOGICAL MILESTONE - Launch of 3nm PCIe Gen 6 switch for AI and enterprise data centers marks significant tech advancement

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Sales Meet $1.14 $1.14

bln bln (19

Analysts

)

Q2 Beat $0.35 $0.33

Adjusted (21

EPS Analysts

)

Q2 EPS $0.03

Q2 $199.10

Adjusted mln

Net

Income

Q2 Net $13.90

Income mln

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 19 "strong buy" or "buy", 8 "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the semiconductors peer group is "buy"

* Wall Street's median 12-month price target for Microchip Technology Inc ( MCHP ) is $78.50, about 22.5% above its November 5 closing price of $60.80

* The stock recently traded at 29 times the next 12-month earnings vs. a P/E of 37 three months ago

Press Release:

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)