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Research Alert: Mchp: Solid Beat And Raise; Cyclical Recovery Gains Traction

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

MCHP delivered standout Mar-Q results with revenue of $1.31B (+35% Y/Y, +10.6% Q/Q) beating $1.263B consensus, while non-GAAP EPS of $0.57 exceeded $0.50 expectation. The strong sequential growth demonstrates meaningful momentum as semiconductor recovery gains traction with broad-based improvement across product lines and end markets. We are encouraged by impressive operational leverage as non-GAAP gross margins expanded to 61.6% and operating margins reached 30.6%, reflecting cumulative benefits of MCHP's disciplined nine-point recovery plan execution. Jun-Q guidance indicates continued strong momentum with revenue midpoint of $1.46B (+35.3% Y/Y, +11.0% Q/Q) ahead of $1.35B expectation and EPS guidance of $0.67-$0.71 vs $0.59 consensus. We believe inventory normalization continues progressing at accelerated pace, with days declining from 201 to 185 and $320.9M reduction from December peak, while connectivity business shows particular strength in data center and AI applications supporting market share gains.

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