S&P 500
7,226.20
+0.01%
Dow Jones
49,494.60
-0.62%
Nasdaq 100
27,685.40
+0.66%
Russell 2000
2,804.78
-0.02%
FTSE 100
10,364.50
0.00%
Nikkei 225
59,260.50
-0.78%
Microchip Technology

MCHP Q1 2026 Earnings

Reported Aug 7, 2025 at 4:20 PM ET · SEC Source

Q1 26 EPS

$0.27

BEAT +13.16%

Est. $0.24

Q1 26 Revenue

$1.08B

BEAT +1.87%

Est. $1.06B

vs S&P Since Q1 26

+42.4%

BEATING MARKET

MCHP +55.5% vs S&P +13.1%

Market Reaction

Did MCHP Beat Earnings? Q1 2026 Results

Microchip Technology kicked off its fiscal 2026 with a recovery narrative gaining traction, posting Q1 results that beat analyst expectations on both the top and bottom lines despite a still-challenging year-over-year backdrop. The Chandler, Arizona-… Read more Microchip Technology kicked off its fiscal 2026 with a recovery narrative gaining traction, posting Q1 results that beat analyst expectations on both the top and bottom lines despite a still-challenging year-over-year backdrop. The Chandler, Arizona-based chipmaker reported revenue of $1.08 billion, ahead of the $1.06 billion consensus by 1.87%, while non-GAAP EPS of $0.27 topped the $0.24 estimate by 13.16%; revenue nonetheless fell 13.4% from the year-ago quarter, reflecting the lingering weight of an industry-wide inventory correction. The key driver behind the beat was what CEO Steve Sanghi called a "trifecta effect," as distributor sell-through recovered, sell-in and sell-out gaps narrowed, and direct customer inventory normalized, combining to push sequential revenue up 10.8%. Non-GAAP incremental gross margins hit 76% in the period, underscoring improving operating leverage as utilization charges and inventory write-offs eased. Looking ahead, Microchip guided Q2 net sales to a midpoint of $1.13 billion with non-GAAP EPS of $0.30 to $0.36, bolstered by July bookings that management described as the strongest since July 2022.

Key Takeaways

  • • 10.8% sequential revenue growth exceeding revised guidance
  • • Trifecta effect: recovery in distributor sell-through, narrowing sell-in/sell-out gaps, and normalization of direct customer inventory
  • • Inventory reduction of $124.4 million in the quarter; distribution inventory days down 4 days to 29 days
  • • Incremental non-GAAP gross margins of 76% and incremental non-GAAP operating margins of 82%
  • • Declining inventory write-offs and reduced underutilization charges driving margin expansion
24/7 Wall St

MCHP YoY Financials

Q1 2026 vs Q1 2025, source: SEC Filings

“Fiscal 2026 is off to a strong start as revenue grew 10.8% sequentially to approximately $1.0755 billion, well ahead of our revised guidance. As we execute our strategic imperatives under our nine-point recovery plan, we are seeing improvements across key financial metrics and emerging from the prolonged industry downturn with enhanced operational capabilities and a strengthened financial position. The momentum from the March quarter has accelerated into fiscal 2026, validating our strategic plan and positioning us well to capitalize on the recovery.”

— Steve Sanghi, Q1 2026 Earnings Press Release

Back to MCHP Stock Page