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Looking back on analog semiconductors stocks’ Q4 earnings, we examine this quarter’s best and worst performers, including Microchip Technology (NASDAQ:MCHP) and its peers.
Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.
The 15 analog semiconductors stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.7% while next quarter’s revenue guidance was above.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.8% since the latest earnings results.
Weakest Q4: Microchip Technology (NASDAQ:MCHP)
Spun out from General Instrument in 1987, Microchip Technology (NASDAQ: MCHP) is a leading provider of microcontrollers and integrated circuits used mainly in the automotive world, especially in electric vehicles and their charging devices.
Microchip Technology reported revenues of $1.03 billion, down 41.9% year on year. This print fell short of analysts’ expectations by 1.8%. Overall, it was a disappointing quarter for the company with a miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EPS estimates.
"Our December quarter performance reflects the need for the decisive steps we are taking to realign our business, as revenue declined to $1.026 billion and inventory levels reached 266 days," said Steve Sanghi, Microchip's CEO and President.
Microchip Technology delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $53.50.
Read our full report on Microchip Technology here, it’s free.
Best Q4: Himax (NASDAQ:HIMX)
Taiwan-based Himax Technologies (NASDAQ:HIMX) is a leading manufacturer of display driver chips and timing controllers used in TVs, laptops, and mobile phones.
Himax reported revenues of $237.2 million, up 4.2% year on year, outperforming analysts’ expectations by 7.3%. The business had a stunning quarter with a significant improvement in its inventory levels and an impressive beat of analysts’ EPS estimates.
Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 5% since reporting. It currently trades at $8.66.