Microchip Technology Lifts Mid-point Of Q1 Outlook Range

(RTTNews) - Microchip Technology Inc. (MCHP), a provider of microcontroller, mixed signal, analog and Flash-IP solutions, on Monday lifted its the range of its prior guidance for net sales and earnings per share for its fiscal first quarter of 2018 ending June 30.

The company now expects first-quarter GAAP earnings per share to be between 62 cents and 64 cents, and adjusted earnings per share to be between $1.22 and $1.26. The original guidance for GAAP earnings per share was between 59 cents and 64 cents and adjusted earnings per share was between $1.17 and $1.27.

Further, Microchip now expects consolidated net sales to be up 4.5% to 6% with a mid-point of up 5.25%, compared to previous guidance of up 2% to 7%, with a midpoint of 4.5%.

At the mid-point of new guidance, net sales in the fiscal first quarter of 2018 are expected to grow 12.6% from non-GAAP sales of the same quarter of a year ago. Net sales are expected to be up 18.8% from GAAP net sales of the same quarter of a year ago.

Steve Sanghi, Microchip's CEO, said, "Our business for the first two months of the June 2017 quarter is tracking higher than the midpoint of our original guidance provided on May 9, 2017. … With such growth driven by our own initiatives as well as strong industry conditions, our inventory internally as well as at distributors is extremely low and lead times are stretching out. While we are adding capacity in numerous areas, we expect that it could take another year for our inventories and lead times to return to more normal levels. As a result, revenue opportunities are moving from one quarter to another and will likely continue to do so for several quarters."

In the after hours trading on Monday, Microchip shares gained 1.15 percent to $85.48.