Microchip Technology Incorporated (MCHP.US) reported a 35% year-on-year increase in revenue for Q4, exceeding expectations for Q1 performance guidance.

Embedded control solution provider Microchip Technology Incorporated (MCHP.US) announced its performance for the fourth quarter of the 2026 fiscal year, showing a 35% year-on-year revenue growth to $1.31 billion, higher than the analyst's average expectation of $1.26 billion; adjusted earnings per share were $0.57, higher than the analyst's average expectation of $0.50; adjusted gross margin was 61.6%, also higher than the analyst's average expectation of 61%. Microchip Technology Incorporated CEO Steve Sanghi stated: "Our performance in the fourth quarter significantly exceeded expectations, with revenue of $1.31 billion surpassing the upper end of guidance, representing a 10.6% sequential increase and a 35.1% year-on-year increase, reflecting broad-based improvement in all businesses." He added, "With the improving demand environment and the normalization of customer inventory levels, we are seeing momentum strengthening across all product lines, improvements in order and sales trends, robust expedite order activity, and significant operating leverage improvement, reflecting the rigorous execution of our nine-point recovery plan." Looking ahead, Microchip Technology Incorporated expects first-quarter revenue for the 2027 fiscal year to be between $1.44 billion and $1.47 billion, well above the market expectation of $1.34 billion; expects adjusted gross margin to be between 62.3% and 63.3%, compared to the market expectation of 61.6%. The company also disclosed that its board of directors has approved a quarterly cash dividend of $0.455 per common share. The latest performance and guidance of Microchip Technology Incorporated, along with other analog chip manufacturers such as Texas Instruments Incorporated (TXN.US), reflect the recovery of the analog chip industry under the boost of the artificial intelligence (AI) super cycle. As of the time of writing, Microchip Technology Incorporated's stock rose more than 2% after hours on Thursday.