Is the business good?
How good a business is MCHP?
Microchip Technology earns 5.4% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
5.4%
Return on invested capital · cost of capital 9.0% · 3.6 points below what the capital costs: growth destroys value
- Operating margin
- 16%
Operating margin · Semiconductors median 8.5% · 12 months to Q1 2027
- Cash conversion
- 2.32×
Cash conversion · every dollar of reported profit arrived as cash, and more
- Share count, year on year
- +2.1%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2021 | 18% |
| FY2022 | 27% |
| FY2023 | 37% |
| FY2024 | 34% |
| FY2025 | 6.7% |
| FY2026 | 10% |
Details›
- Gross margin12 months to Q1 2027
- 60%
- Operating margin12 months to Q1 2027
- 16%
- Net margin12 months to Q1 2027
- 9.3%
- Free cash flow margin
- 22%
- R&D as % of revenue
- 22%
- Revenue, trailing twelve months
- $5.12B
- Free cash flow, trailing twelve months
- $1.11B
- Net income, trailing twelve months
- $478M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 5.4%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.