2024-12-03 04:15:57 :
Dec 2 (Reuters) – Microchip Technology on Monday lowered its third-quarter revenue forecast and announced the closure of a wafer fabrication plant in Arizona, which the chipmaker hopes to do under interim Chief Executive Steve Sanghi. Reorganization.
Microchip has endured a tumultuous few quarters, grappling with slowing auto chip orders as automakers navigate an uncertain macroeconomic and clear existing inventories they’ve built to avoid a supply crunch.
The company now expects revenue to be near the lower end of its previous forecast of $1.03 billion, below the $1.06 billion analysts expected based on data compiled by LSEG.
Microchip shares fell more than 3.5% in after-hours trading after closing up about 3%. The company’s shares have fallen 22% so far this year.
Microchip expects to close the Arizona facility in the September 2025 quarter, saving approximately $90 million in annual cash.
“Due to high inventory levels and sufficient capacity, we have decided to close our Tempe wafer fabrication facility, known as Fab 2,” said interim CEO Sanghi, who took over after Ganesh Moorthy retired. Late November.
The company said the closures will help the company ease inventory levels starting in the fourth quarter and will affect about 500 employees.
The company said it has ample room for expansion at its other facilities in Oregon and Colorado and plans to move product manufacturing from its Arizona facility to other such facilities.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Krishna Chandra Eluri)
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