Microchip Technology reported Q2 FY2025 revenue of $1.16B, down 48.4% YoY, as customers reduced inventory amid economic uncertainty. Net income fell to $146.6M from $546.2M last year. Gross margin declined to 57.4% from 67.8% due to lower sales volumes and unabsorbed capacity charges.The company saw weakness across most end markets, with mixed-signal microcontrollers revenue down 53.6% YoY to $594.6M. Analog product sales decreased 53.1% to $292.1M. Management cited slowing economic activity, high interest rates, and shorter lead times as factors impacting customer demand and inventory reduction efforts.Microchip is managing costs and pausing most factory expansions given the weak environment. It expects Q3 revenue of $1.225B-$1.425B, implying a potential sequential increase. The company remains focused on its Total System Solution strategy and expanding its served markets long-term despite near-term headwinds.

Microchip Technology reported Q2 FY2025 revenue of $1.16B, down 48.4% YoY, as customers reduced inventory amid economic uncertainty. Net income fell to $146.6M from $546.2M last year. Gross margin declined to 57.4% from 67.8% due to lower sales volumes and unabsorbed capacity charges.The company saw weakness across most end markets, with mixed-signal microcontrollers revenue down 53.6% YoY to $594.6M. Analog product sales decreased 53.1% to $292.1M. Management cited slowing economic activity, high interest rates, and shorter lead times as factors impacting customer demand and inventory reduction efforts.Microchip is managing costs and pausing most factory expansions given the weak environment. It expects Q3 revenue of $1.225B-$1.425B, implying a potential sequential increase. The company remains focused on its Total System Solution strategy and expanding its served markets long-term despite near-term headwinds.