Microchip Technology Incorporated · NASDAQ:MCHP
Microchip Technology — Investor Presentation (June 2024)
21 slides from Microchip Technology's investor presentation, June 2024
Slide 1: Investor Presentation June 2024
Investor Presentation June 2024 A Leading Provider of Smart, Connected and Secure Embedded Solutions
Slide 2: Safe Harbor
SAFE HARBOR Forward Looking Statement Safe Harbor: During the course of this presentation, we will make projections or other forward-looking statements regarding the future financial performance of the company (including our guidance) or future events, including our strategy, growth drivers, industr
Slide 3: Corporate Overview
Corporate Overview Leading Total Systems Solutions Provider • High-performance standard and • Wireless and Wired Connectivity specialized Mixed-Signal solutions Microcontroller, Digital Signal Controller • FPGA solutions and Microprocessor solutions $6.8 • Non-volatile EEPROM and Flash • Mixed-Signa
Slide 4: Revenue By End Market
Revenue By End Market* FY23 Durable End Markets FY24 12% 11% 11% 10% 41% 43% 17% 18% 19% 18% Industrial Data Center & Computing Automotive Communication Consumer Appliance 4 *Based on Microchip Internal Microchip Proprietary and Confidential
Slide 5: Net Sales Growth
Net Sales Growth 10,000 9,000 134 consecutive quarters of Non-GAAP 8,000 profitability! 7,000 $ Million 6,000 15.5% CAGR 5,000 4,000 3,000 2,000 1,000 0 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY
Slide 6: Fourth Quarter FY2024 Revenue Mix
Fourth Quarter FY2024 Revenue Mix Net Sales by Net SalesEurope by Net Sales by Product Line Geography24% Channel Oth Mix er ed Am Direct 23% Sign eric 53% al as MCU Distr 31 s Asia ibuti % Anal 52% 45% on og 47% 25% Organic growth efforts focused on TSS and Megatrends Synergistic product portfol
Slide 7: Fiscal 4th Quarter 2024 Results (non-GAAP)
Fiscal 4th Quarter 2024 Results (non-GAAP) Revenue of $1.33 billion; declined 24.9% QoQ and 40.6% YoY Gross Profit: $799.6 million (60.3% Gross Margin) Operating Income: $436.0 million (32.9% Operating Margin) Earnings per share of $0.57 Cumulatively paid down ~$6.8 billion of debt over th
Slide 8: Fiscal Year 2024 Results (non-GAAP)
Fiscal Year 2024 Results (non- GAAP) Revenue of $7.63 billion; declined 9.5% YoY ‒ MCU and Analog revenue decreased 10.2% and 15.2% YoY but FPGA revenue was up 22% YoY Gross Profit: $5,025.6 billion (65.8% Gross Margin) Operating Income: $3,349.2 billion (43.9% Operating Margin) Earnings per
Slide 9: Fiscal Q1 2025 Guidance (non-GAAP)
Fiscal 1 Quarter 2025 Guidance st (non-GAAP)* FY24 Q4 Q1 FY25 Long Term Actual FY24 Guide @ Model Revenue ($ Actual mid-point $7.634B $1,325.8 $1,240 Million) Gross Margins 65.8% 60.3% 60.0% 67.5% to Operating 68.5% 22.0% 27.4% 28.5% 22.5% to Expenses 23.5% Operating 43.9% 32.9% 31.5% 44% to Margins
Slide 10: Semi Industry Sales Y/Y Growth Through Cycles
Semi Industry Sales YoY Growth Through 35% Cycles 31.8% 30% 26.2% 25% 21.6% Semi Industry Sales Y/Y 20% Growth Rates 15% 13.7% 10% 9.9% 5%3.2% 6.8% 4.8% 3.2% 4.0% 0% -2.0% -1.1% -5% -2.8% -2.7% -10% -9.0% -12.0% -9.4% -15% 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 20 20 20 20 20 20 20 20 20
Slide 11: Strong Cash Generation Through Cycles
Strong Cash Generation Through Cycles 35% 30% 12.2 $3,150 $2,650 25% % $2,150 Semi Industry Sales Y/Y Growth ADJ. FCF* Adj. Microchip Free Cash Flow* 20% CAGR since $1,650 15% 2007 $1,150 10% ($ in millions) $650 Rates 5% $150 0% -5% -$350 -10% -$850 -15% -$1,350 Adj. MCHP FCF - Semi Sales Y/Y Growt
Slide 12: Resilient Profitability Through Cycles
Resilient Profitability Through Cycles 35% 30% MCHP LT Non-GAAP Gross Margin Target* 67.8% 70% 68% 25% 66% Semi Industry Sales Y/Y Growth 65.7% Microchip NG Gross Margin % 65.8% 20% 62.8% 64% 62.0% 15%60.9% 62% 60.1% 58.8% 61.9% 10% 58.8% 60% 58.2% 57.6% 61.1% 57.4% Rates 5% 58% 57.9% 58.1% 0% 57.2%
Slide 13: Improving Efficiency Through Cycles
Improving Efficiency Through Cycles 35% 30% MCHP LT Non-GAAP Operating 46.9% 50% 45% Margin Target* 43.5% 43.9% 25% Semi Industry Sales Y/Y Growth 39.6% 40% Microchip NG Operating Margin % 37.1% 20% 34.9% 32.5% 38.7% 35% 15% 36.6% 32.3% 31.8% 32.6% 36.2% 10% 31.5% 30% 30.2% 30.3% Rates 29.1% 5% 25%
Slide 14: Microchip Organic Growth Strategy
Microchip Organic Growth Strategy Focus on Total System Solutions (TSS) ‒ Diversified portfolio of Smart, Connected and Secure Solutions ‒ Software, firmware, reference designs to speed customer’s time to market Provide solutions in Megatrend growth areas ‒ Drives innovation Empowering growth ≥
Slide 15: Empowering Innovation In Diverse, Durable Markets
Empowering Innovation In Diverse, Durable Markets Consum Industri Spac er al e Sustainabil Automoti Medic Data ity ve al Center Defens Communication Infrastructure Aviatio e n 15
Slide 16: Providing Total System Solutions
Providing Total System Solutions Portfolio of Hardware, Software and Services Power Management RFICs MMICs DC-DC Converters Encryption Supervisors & Ref. & High Voltage Precision LDOs, Battery Mgt. Digital Security I/Os Voltage Discretes & Modules Potentiometer Reference Motor Sensors Drivers Amplif
Slide 17: Market Megatrends
Market Megatrends Industrial 5G AI/ML IoT/Edge Computing Computin g AI/ML Data Centers Automotiv e E-Mobility Communications Sustainability Consumer AI/ML ADAS/Autonomous Driving 17
Slide 18: Revenue By Megatrend
Revenue By Megatrend FY23 FY24 5G 5% 5% IoT Data 12 13 Center % % EV 16 ADAS 18 % 55 53 Sustainabil % % % 3% ity 6% Other 4% 3% 3% 4% *Based on Microchip’s internal estimates. 18
Slide 19: Consistent, Disciplined and Balanced Capital Return Strategy
Consistent, Disciplined and Balanced Capital Return Strategy ‒ Continuing to reduce debt after increasing Debt Paydown leverage for M&A ‒ Reduced debt over the Adjusted Free last 21 out of 23 quarters $6.8 Cash Flow (FCF)* Dividends Paid ‒ ‒ 87 consecutive Current quarters leverage ratio Billion of
Slide 20: Environmental Stewardship
Environmental Stewardship Waste Water Energy GHG Reduction Manageme Consumpti Emissions and Reuse nt on 20 Click Here for Microchip’s 2022 Sustai nability Report
Slide 21: Thank You
THANK YOU A Leading Provider of Smart, Connected and Secure Embedded Control Solutions
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