QUOTE AND NEWS
Market Intelligence Center  Jul 21  Comment 
The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artifical Intelligence Center found a trading opportunity with Microchip Technology Inc (MCHP) that should provide a 2.92% return in just 89 days. Sell one Oct....
newratings.com  Jul 14  Comment 
CHANDLER (dpa-AFX) - Microchip Technology Inc (MCHP), Monday announced the successful completion of its tender offer to acquire the outstanding shares of Taiwan-based ISSC Technologies Corp. As of the expiration date of the tender offer on July...
Forbes  Jul 11  Comment 
The most recent short interest data has been released by the NASDAQ for the 06/30/2014 settlement date, and we here at Dividend Channel like to sift through this fresh data and order the underlying components of the S&P 500 by "days to cover."...
DailyFinance  Jun 25  Comment 
Microchip Technology Inc. (NASDAQ: MCHP), a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, today announced a new family of PIC32MX1/2 microcontrollers (MCUs) in 256/64 KB Flash/Ram...
Motley Fool  Jun 21  Comment 
Microchip Technology posted 20% growth in 2013, compared to just 5.2% for the whole semiconductor industry. Can the embedded and analog chipmaker continue to outperform?
DailyFinance  Jun 18  Comment 
Microchip Technology Inc. (NASDAQ: MCHP), a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, today expanded its 36V digital potentiometer (digipot) portfolio with two new volatile, I2C™ ...
Market Intelligence Center  Jun 5  Comment 
Microchip Technology Inc (MCHP) traded between $47.11 and $47.78 before closing at $47.76 Wednesday and presents some attractive trading opportunities today. MarketIntelligenceCenter.com’s algorithms have picked a Oct. '14 $47.00 covered call...
TheStreet.com  Jun 2  Comment 
NEW YORK (TheStreet) -- Shares of Microchip Technology Inc. are lower -1.28% to $46.99 in pre-market trading on Monday due to a ratings downgrade to "neutral" from "buy" at Goldman Sachs . The firm said it lowered its rating on the company,...
SeekingAlpha  May 28  Comment 
By Stephen Simpson, CFA: I'll state off the top that I like Microchip Technology (MCHP) as a company. The company has established itself as a top five player in microcontrollers (or MCUs) and is poised to benefit from the growing Internet of...
newratings.com  May 22  Comment 
CHANDLER (dpa-AFX) - Semiconductor company Microchip Technology Inc. (MCHP) Thursday said it will acquire ISSC Technologies Corp., a provider of low power blue-tooth and advanced wireless solutions for the Internet Of Things market, for a total...




 

Microchip Technology (NASDAQ: MCHP) makes analog microcontrollers, memory, and other electronic components for embedded systems, which are small, low-power computers designed to perform specific tasks. The company primarily competes in the microcontroller market.

MCHP primarily competes with STMicroelectronics and Atmel.[1] In April 2009, Microchip Technology acquired R&E International, a privately-held developer of integrated circuits. [2]

Business Overview

Business & Financial Metrics[3]

In FY2010, MCHP generated a net income of $217 million on revenues of $947.7 million. This represents an 11.6% decrease in net income and a 4.9% increase in total sales from FY2009, when the company earned $245.6 million on $903. million in total revenues.

Business Segments[4]

MCHP operates through one reportable segment that engages in the design, development, manufacture, and marketing of semiconductors.

Microcontrollers (81.0% of FY2010 sales)

Microcontrollers are essentially computers condensed to a single chip, containing a processor, memory, and a input/output interface. MCHP produces microcontrollers under its PIC brand name. PIC microcontrollers are designed for high performance, low power and cost effectiveness. MCHP microcontrollers use a dual-bus architecture, which has separate pathways for data and instruction, making them faster than the majority of other microcontroller products on the market that tend to use single-bus architectures. MCHP manufactures products in the 8-bit, 16-bit, and 32-bit microcontroller markets and has the largest market share in the 8-bit market.[5] The 8-bit microcontroller is the smallest and most popular of the three, as an estimated 55% of all computers use 8-bit microcontrollers.[6] The 16-bit and 32-bit microcontrollers are more computationally powerful and physically bigger.

MCHP also makes the Development Tools that system designers use to program PIC microcontrollers. These tools are hardware products that let these designers program MCHP's microcontrollers and other electronics products.

Memory Products (8.5% of FY2010 sales)

Memory products consist of Serial EEPROMs (Electrically Erasable Programmable Read-Only Memory), which are useful in embedded devices because they do not require power to keep data stored. MCHP is the largest manufacturer of EEPROMs.

Analog and Interface Products (10,5% of FY2010 sales)

Analog and Interface Products consist of MCHP's power management, linear, mixed-signal, thermal management and interface products, which number over 500. Its line of mixed-signal products primarily includes data converters that convert data from analog to digital or vice versa. Linear products refer to Microchip's products that transfer either analog or digital data, without any conversions.[7]

IMAGE:MCHP-Segments2009.jpg[4]

Key Trends and Forces

Microchip's business has suffered from decreasing demand for its products

Products in the semiconductor industry tend to have short shelf lives, with their selling prices decreasing rapidly over the course of their existence. In the case of Microchip, the average selling prices of its microcontroller and analog and interface products remained relatively constant, but average selling prices of its memory products and non-proprietary analog and interface products have decreased.

Weak U.S. Dollar benefits Microchip's international sales

Because MCHP reports its revenues in U.S. dollars but most of its business is international, it is affected by exchange rates. When the value of the dollar depreciates, MCHP's international sales grow in dollar terms. From 2006-2008, the dollar depreciated relative to the Euro and Japanese Yen.[8][9]

Competitors

  • Atmel (ATML) competes with all three of MCHP's segments and is most notably successful for its business in the smart card market.[10][11]
  • STMicroelectronics (STM) manufactures a wide variety of products in its 3 segments: application specific product group, industrial and multi-segment group, and flash memory group. In the application specific product group, STM competes with Microchip in the production of mixed signal and power technologies. STM's industrial and multi-segment group, on the other hand, competes with MCHP in the production of microcontrollers and memory products.[12][13]

References

  1. MCHP Press Release, 8 Apr 2090
  2. MCHP 2009 10-K pg. F-3  
  3. 4.0 4.1 MCHP 2009 10-K pg. 31  
  4. Wikipedia: 8-bit
  5. EUR to USD Exchange Rates
  6. USD to JPY Exchange Rates
  7. Wikinvest: Atmel
  8. Atmel: Products
  9. Wikinvest: STMicroelectronics
  10. STMicroelectronics: Company Profile
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