Microchip (MCHP) to Report Q3 Earnings: What's in the Cards?
Microchip Technology MCHP is set to release its third-quarter fiscal 2024 results on Feb 1.
Microchip had originally expected net sales to be $1.8-$1.916 billion for the third quarter of fiscal 2024, suggesting a decline between 15% and 20% on a sequential basis. Non-GAAP earnings were anticipated between $1.09 per share and $1.17.
The company later revised its guidance on Jan 8, 2024, and announced that it now expects its revenue to decline by 22% sequentially in the third quarter of fiscal 2024.
The Zacks Consensus Estimate for fiscal third-quarter earnings is currently pegged at $1.06 per share, down 6.2% in the past 30 days and suggesting a 32.05% year-over-year decline.
Microchip Technology Incorporated Price and EPS Surprise
Microchip Technology Incorporated price-eps-surprise | Microchip Technology Incorporated Quote
The consensus estimate for revenues is pegged at $1.79 billion, suggesting a decline of 17.44% year over year.
Microchip’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and are in line in the remaining two, delivering an earnings surprise of 0.47%, on average.
Let’s see how things have shaped up for the company prior to this announcement.
Factors to Note
Microchip expects third-quarter fiscal 2024 revenues to decline.
It has been suffering from a slowdown in business due to increasing uncertainty, slowing economic activity and an increase in inventory. Persistent inflation and high interest rates have been detrimental to the company’s prospects.
Despite these challenges, Microchip’s consistent strength in its analog and mixed-signal microcontroller businesses is expected to have contributed in the to-be-reported quarter.
MCHP's robust portfolio of its 8, 16, and 32-bit microcontrollers and its widespread adoption is expected to have bolstered MCHP's performance in the fiscal third quarter.
Microchip's expanded portfolio, including the PIC16F13145 MCU family, PIC18-Q24 MCU family, PIC18 Q20 product line, and MPLAB Machine Learning Development suite, is poised to enhance its long-term prospects.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Microchip has an Earnings ESP of -3.64% and a Zacks Rank #5 (Strong Sell) currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Meta Platform META has an Earnings ESP of +0.51% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Meta Platform is set to announce fourth-quarter 2023 results on Feb 1. META’s shares are up 25.9% in the past six months.
Twilio TWLO has an Earnings ESP of +31.37% and a Zacks Rank #2.
Twilo is set to announce fourth-quarter 2023 results on Feb 14. TWLO’s shares have gained 13% in the past six months.
Bill Holdings BILL has an Earnings ESP of +6.17% and a Zacks Rank #3.
Bill Holdings is set to announce second-quarter fiscal 2024 results on Feb 8. BILL’s shares have declined 36.2% in the past six months.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Microchip Technology Incorporated (MCHP) : Free Stock Analysis Report
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