Microchip Technology has reported Q3 sales of $1.287bn, down 3.8% sequentially and down 6.4% from the year ago quarter. Net income for the third quarter of fiscal 2020 was $311.1 million.
“The end-market demand for our microcontroller business was down 1.1%, our analogue business was down 3.6% and our FPGA business was flat compared to the September 2019 quarter. Microcontrollers represented 53.6%, analogue represented 28.1% and FPGA represented 6.9% of our end-market demand in the December quarter. We continue to introduce a steady stream of new and innovative microcontroller, analogue and FPGA solutions that we believe position us well for future growth,” said Ganesh Moorthy, President and Chief Operating Officer.
“From a geographical perspective, we saw strength in the China market last quarter. But you would see the weakness in China market this quarter, driven by the Lunar New Year and nobody knows what’s going to happen with the Coronavirus. So this quarter, you would see stronger U.S. and Europe and weaker China.”continued Moorthy.
He added, “While our bookings and backlog trends have not changed since our business update press release on January 6, the Coronavirus situation is rapidly evolving and most Chinese provinces have extended the Chinese New Year holidays in response to the spread of the virus. We have taken preventive measures to help ensure the safety of our employees and have completed a first pass assessment of our supply chain and currently believe our risk is low. However, it is too early to determine the impact to our customers as many of them are still not back from their holidays. We continue to actively monitor the progression of the Coronavirus events and plan to take additional actions as needed.”
Steve Sanghi (pictured), Chief Executive Officer, Microchip Technology commented: “Our March quarter backlog is significantly higher than the December quarter backlog was at the same point in the quarter. We are experiencing an increased level of customer requested expedited shipments and we are calling the December 2019 quarter as the bottom of the cycle for Microchip barring any negative developments on the US/China trade front, or the impact of Coronavirus.”