Microchip Technology Incorporated reported results for the three months ended June 30. GAAP net sales for the first quarter of fiscal 2016 were $534.0 million, up 1.0% from GAAP net sales of $528.9 million in the prior year's first fiscal quarter. GAAP net income for the first quarter of fiscal 2016 was $130.7 million, or 60 cents per diluted share, up 45.3% from GAAP net income of $89.9 million, or 40 cents per diluted share, in the prior year's first fiscal quarter.
Non-GAAP net sales for the first quarter of fiscal 2016 were $534.0 million, up 0.5% from non-GAAP net sales of $531.3 million in the prior year's first fiscal quarter. Non-GAAP net income for the first quarter of fiscal 2016 was $148.9 million, or 69 cents per diluted share, down 1.8% from non-GAAP net income of $151.6 million, or 68 cents per diluted share, in the prior year's first fiscal quarter. For the first quarters of fiscal 2016 and fiscal 2015, non-GAAP results exclude the effect of share-based compensation, expenses related to the acquisition activities (including intangible asset amortization, inventory valuation costs, severance costs, and legal and other general and administrative expenses associated with acquisitions), GAAP non recognition of revenue for inventory in the distribution channel at the acquisition date for various acquisitions, gains from equity securities and equity method investment, non-cash interest expense on our convertible debentures, and non-recurring tax events.
Microchip announced today that its Board of Directors declared a quarterly cash dividend on its common stock of 35.80 cents per share. The quarterly dividend is payable on September 25, 2015 to stockholders of record on September 11, 2015. Microchip also announced today that it has completed its acquisition of Micrel Incorporated for a combination of approximately $430 million in cash and the issuance of 8,626,795 shares of Microchip common stock.
"Our June quarter revenue was below our guidance but was consistent with industry conditions as evidenced by what others in the semiconductor industry have reported," said Steve Sanghi, President and CEO. "The June quarter started out well, but the negative effects of a very weak economy in China and challenges in Europe, led by a very weak Euro caused us to finish the quarter below our revenue guidance provided on May 7, 2015."
Mr. Sanghi added, "Our non-GAAP gross margin percentage and our operating profit percentage were within our guidance and we achieved record non-GAAP earnings per share. The June quarter was our 99th consecutive quarter of profitability."
"Our microcontroller revenue was up 1.3% in the June quarter compared to the year ago quarter and we experienced the same broad-based weakness that has been reported by many other companies in the industry," said Ganesh Moorthy, Chief Operating Officer. "In the aggregate over the last four rolling quarters, our microcontroller business was up 8% over the prior four quarters. We are continuing to deliver innovative new 8-bit, 16-bit and 32-bit microcontrollers that we believe will enable us to continue to gain market share."
Mr. Moorthy added, "Our analog business was down 0.6% in the June quarter compared to the year ago quarter and experienced the same weakness we saw in our microcontroller business. In the aggregate over the last four rolling quarters, our analog business was up 11% over the prior four quarters. We continue to develop and introduce a wide range of innovative and proprietary new products to help fuel the future growth of our analog business."
Eric Bjornholt, Microchip's Chief Financial Officer, said, "Our cash generation in the June quarter excluding the purchase of the remaining outstanding shares of ISSC, our dividend payment, and changes in borrowing levels, was $143.8 million. As of June 30, 2015, our consolidated cash and total investment position was approximately $2.43 billion. The dividend that we announced today marks the 46th occasion that we have increased our dividend payment, and cumulative dividends paid are now $2.59 billion."
Mr. Sanghi concluded, "We have evaluated the current global economic environment, semiconductor industry conditions, our backlog position and customer designs coming to production and expect our revenue to be between $497 million and $534 million in the September quarter, excluding any revenue from our Micrel acquisition for the partial quarter after the closing of the acquisition. From the date of acquisition, we expect non-GAAP revenue from Micrel to add an additional $35 million to our September results."
