Microchip Tech forecasts quarterly revenue above estimates on strong chip demand

May 7 (Reuters) - Microchip ‌Technology forecast ​first-quarter ​revenue above estimates on Thursday, betting on strong demand for its chips used in industrial ‌and automotive sectors.

Shares of the Chandler, Arizona-based company ⁠rose more than 2% in extended trading.

The company has benefited ‌from a cyclical recovery ‌in key end-markets including industrial and automotive, as well as surging demand from artificial intelligence data centers.

Robust ​spending in the aerospace and defense markets, fueled by geopolitical tensions and increased government budgets, has ⁠also provided a stable source of revenue growth.

Microchip expects first-quarter revenue between $1.44 ​billion and $1.47 billion, above analysts' average estimate of $1.34 billion, according to data compiled by ​LSEG.

Adjusted profit per share is ‌expected to be between 67 cents and 71 cents, above estimates of 59 cents.

“We ⁠are seeing strong customer engagement and expanding design activity in data center and AI applications, driven by the breadth ⁠and performance of our high-speed connectivity and compute portfolio,” Chief ​Operating Officer Rich Simoncic said in a statement.

Peer Onsemi also forecast quarterly revenue above estimates on Monday, betting on demand for ‌its chips as the automotive industry recovers.

For the fourth quarter, Microchip reported revenue ‌of $1.31 billion, beating estimates of $1.26 billion. Adjusted profit came ⁠in at 57 cents ‌per share, compared ​with estimates of 51 cents per share.

(Reporting by Anhata Rooprai in Bengaluru; Editing by Sahal ‌Muhammed)

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