Date: 30/01/2009

8-bit microcontroller leader Microchip's revenue for 3Q 09(fiscal) decline by 28.8%

Microcontroller and analog semiconductor expert, Microchip reported results for the three months ended December 31, 2008. Net sales for the third quarter of fiscal 2009 were $192.2 million, down 28.8% sequentially from net sales of $269.7 million in the immediately preceding quarter, and down 23.9% from net sales of $252.6 million in the prior year's third quarter.


"General economic and semiconductor industry conditions continued to decline during the December quarter," said Steve Sanghi, Microchip's President and CEO. "Our December earnings results are reflective of these conditions, and we have taken actions to moderate expense levels and adjust our capacity. We have instituted pay cuts for all of our employees worldwide, and we are substantially reducing or eliminating discretionary expenses. We were able to reduce non-GAAP operating expenses in the quarter ended December 31, 2008 by $14 million, or 20%, over the operating expenses in the quarter ended September 30, 2008."

"We are continuing actions to reduce production levels in our wafer fabrication facilities in the U.S. and our assembly and test facility in Thailand to moderate inventory growth. We are lowering our production levels by about 40% in the March quarter from peak levels in the September 2008 quarter. We are charging the underutilization to cost of goods sold to reflect lower than normal production levels. We are also implementing various other actions to further reduce operating expenses," continued Mr. Sanghi.