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Microchip Technology Incorporated (MCHP-4.35%) has submitted its 10-Q filing for the quarterly period ended December 31, 2024.
The filing reports net sales of $1,026.0 million for the quarter, a decrease from $1,765.7 million in the same quarter the previous year. This decline is attributed to adverse economic conditions, including slowing economic activity and high inventory levels at customers.
Gross profit for the quarter was $561.4 million, representing 54.7% of net sales, compared to 63.4% in the previous year. The decrease in gross margin is due to unfavorable product mix and increased inventory reserve charges.
Research and development expenses were $246.2 million, or 24.0% of net sales, down from $266.0 million, or 15.1% of net sales, in the previous year. The decrease is primarily due to lower employee compensation costs.
Selling, general, and administrative expenses totaled $158.2 million, or 15.4% of net sales, compared to $172.2 million, or 9.8% of net sales, in the previous year. The decrease is attributed to reduced employee compensation costs.
Net loss for the quarter was $53.6 million, compared to a net income of $419.2 million in the previous year. The loss is primarily due to decreased sales and gross profit margins.
Cash provided by operating activities was $692.2 million for the nine months ended December 31, 2024, compared to $2,462.7 million for the same period in the previous year.
The company reported cash and cash equivalents of $586.0 million as of December 31, 2024, an increase from $319.7 million at the beginning of the fiscal year.
Microchip Technology announced the closure of its Tempe, Arizona wafer fabrication facility, expected to occur in the second quarter of fiscal 2026, with anticipated annual cash savings of approximately $90 million.
The filing also discusses the impact of global economic conditions, including high interest rates and inflation, on the company's operations and financial performance.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Microchip Technology Incorporated quarterly 10-Q report dated February 6, 2025. To report an error, please email earnings@qz.com.