Microchip Technology Inc. Falls Sharply On Lowered Guidance

Microchip Technology Inc. MCHP lowered guidance Thursday and announced that it expects net sales for its second quarter of fiscal 2015, ending September 30, 2014, to be about $546.2 million, which includes about $16.9 million from its recent ISSC acquisition. 

The company had provided guidance on July 31 of $560.0 million to $575.9 million for the 2Q FY2015.

The lowered expectations hit the stock in after-hours trading with shares falling over 8 percent.

“We were disappointed with the level of business activity in the September quarter. The September quarter is usually a back-end weighted quarter because of a traditional weak August due to holidays in various parts of the world. The month of September is usually a strong month for our revenue after the summer holiday period. This time, the September sales did not materialize to our expectations. The revenue miss was led by China where the September quarter is traditionally the strongest. This time, sales in China, excluding ISSC, are expected to be down sequentially,” according to Steve Sanghi, Microchip’s President and CEO.

Microchip Technology Inc. traded after-hours at $41.50, down 8.87 percent.