Wall Street Transcript Interview with Steve Sanghi, Chairman, President and CEO of Microchip Technology Inc. (MCHP)

Wall Street Transcript

67 WALL STREET, New York - May 28, 2013 - The Wall Street Transcript has just published its Semiconductors Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Semiconductor Capital Equipment - Cloud Computing, Mobile Device Consumer Demand - Semiconductor Inventory Burnoff - Improvement from Cyclical Bottom - Semiconductor Capital Equipment Spending - New Computing Platform Demand

Companies include: Microchip Technology Inc. (MCHP) and many more.

In the following excerpt from the Semiconductors Report, the Chairman, President and CEO of Microchip Technology Inc. (MCHP) discusses company strategy and the outlook for this vital industry:

TWST: What metrics do you believe are most meaningful for evaluating your business performance and how did you perform on those key metrics in the fourth quarter?

Mr. Sanghi: We look at a larger number of different metrics inside. We look at sequential growth of the business across all of our divisions. Microchip has at least 13 divisions in the company today. And we would like to grow each division every quarter and that's not always possible. About 10 out of the 13 divisions were sequentially up last quarter.

The other thing we look at is the gross margin of each division against targets that we have established. The industry is going through a recovery. So not all gross margins were at our target. However, we exceeded the overall gross margin estimate.

Actually, we exceeded the range; we were higher than the high end of the range. And then, we look at the operating expenses of the company against an established plan. And there again, the operating expenses were much lower than the range we had guided to the Street. And then, we look at operating profit, which again exceeded the high end of the range. With regards to the earnings per share, we beat the earnings per share Street estimates by $0.05. So those are some of the more quarter-after-quarter publicly known financial metrics.

But we look at a large number of metrics that we largely keep inside. One is the market share. We look at our market share of microcontrollers by bit density - 8-bit, 16-bit, 32-bit - and we compare against the market data. We also look at Microchip's growth in key segments like microcontrollers and analog, and compare them to our industry competitors. We also look at capital invested, how much capital we're deploying, what the return on capital is...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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