Microchip Technology Incorporated stock research
FY2025 Q4
Microchip Technology (MCHP) Gross Margin — Quarter Ended Mar 31, 2025
Revenue declined compared to both the preceding quarter and the same quarter one year earlier. Gross profit fell more sharply, resulting in a lower gross margin, as cost of revenue did not decrease proportionally.
Gross margin takeaway
Quarter ended Mar 31, 2025 · FY2025 Q4
Revenue declined compared to both the preceding quarter and the same quarter one year earlier. Gross profit fell more sharply, resulting in a lower gross margin, as cost of revenue did not decrease proportionally.
- The relationship between cost of revenue and revenue shifted unfavorably, with cost of revenue rising relative to revenue compared to both prior periods.
- Compared to the preceding quarter, revenue and gross profit were lower while cost of revenue was slightly higher, leading to a weakened gross margin. Versus the same quarter one year earlier, all three metrics were lower, but gross margin declined more sharply due to a smaller reduction in cost of revenue relative to revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
51.6%
Gross profit
$501.1M
Revenue
$970.5M
Cost of revenue
$469.4M
Quarter-over-quarter change
-3.1 pts
Year-over-year change
-7.9 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jun 30, 2024 | $1.2B | $736.9M | $504.4M | 59.4% |
| Sep 30, 2024 | $1.2B | $668.5M | $495.3M | 57.4% |
| Dec 31, 2024 | $1.0B | $561.4M | $464.6M | 54.7% |
| Mar 31, 2025 | $970.5M | $501.1M | $469.4M | 51.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2024
-3.1 pts
Year-over-year change
Mar 31, 2024
-7.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The relationship between cost of revenue and revenue shifted unfavorably, with cost of revenue rising relative to revenue compared to both prior periods.
Compared to the preceding quarter, revenue and gross profit were lower while cost of revenue was slightly higher, leading to a weakened gross margin. Versus the same quarter one year earlier, all three metrics were lower, but gross margin declined more sharply due to a smaller reduction in cost of revenue relative to revenue.
Monitor the trajectory of cost of revenue relative to revenue, particularly whether it continues to rise as revenue changes.