Microchip Technology Inc (NASDAQ:MCHP) stock fell 0.57% (As on May 7, 11:24:57 AM UTC-4, Source: Google Finance) after the company forecast first-quarter net sales and profit below Wall Street estimates, signaling weak demand as customers continue to clear excess inventory. Non-GAAP net income for the fourth quarter of fiscal 2024 was $310.3 million, down from non-GAAP net income of $907.8 million, in the prior year’s fourth fiscal quarter. On a Non-GAAP basis the company reported gross profit of 60.3%; operating income of $436.0 million and 32.9% of net sales.
MCHP in the fourth quarter of FY 24 has reported the adjusted earnings per share of 57 cents, which is inline with the analysts’ estimates for the adjusted earnings per share of 57 cents. The company had reported 40.6 percent decline in the adjusted revenue growth to $1.33 billion in the fourth quarter of FY 24, missing the analysts’ estimates for revenue of $1.34 billion.
Additionally, the company declared a quarterly cash dividend on its common stock of 45.2 cents per share, an increase of 18.0% from the year ago quarter. The dividend is payable on June 5, 2024, to stockholders of record on May 22, 2024. The company has returned a record $629.9 million to shareholders in the March quarter through dividends of $242.5 million and the repurchase of $387.4 million, or 4.5 million shares of the common stock, at an average price of $85.38 per share under the previously announced $4.0 billion stock buyback program. Cumulatively repurchased $2.354 billion, or 30.4 million shares, over the last ten quarters. The company continued to work on optimizing our capital structure by issuing $1 billion in senior notes due in 2029 at an interest rate of 5.05%. During fiscal year 2024, the company had reduced gross debt by $447.4 million.
Microchip forecasts net sales in the range of $1.22 billion to $1.26 billion for the first quarter ending in June 30, compared with analysts’ average estimate of $1.34 billion, according to LSEG data. The Chandler, Arizona-based company expects adjusted profit per share between 29 cents and 32 cents, compared with an estimate of 59 cents.
On the other hand, the company continued to reduce inventory. This situation has required them to implement ongoing austerity measures, including taking actions to reduce factory utilization, that will persist into the June quarter. The company in the quarter has launched 10 multi-channel remote temperature sensors with the MCP998x family, increased the TrustFLEX family etc.