Simply Wall St
4 min read
Microchip Technology recently expanded its edge AI offering with full-stack solutions built around its long-established MCUs and MPUs, adding pre-trained models and development tools for applications such as arc fault detection, predictive maintenance, facial recognition with liveness detection, and keyword spotting at the edge.
This push turns Microchip’s embedded controllers into more complete platforms for secure, power-efficient on-device intelligence, potentially deepening its role in emerging edge AI ecosystems that seek to reduce latency, enhance data privacy, and lessen reliance on cloud computing.
We’ll now examine how Microchip’s expanded full-stack edge AI platform could reshape its investment narrative around AI-driven embedded control.
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To own Microchip, you need to believe its embedded control franchise can translate rising demand for connected, AI-capable devices into durable, higher quality earnings while it works through elevated inventory and a still-leveraged balance sheet. The new full-stack edge AI platform supports the AI-driven embedded control catalyst story, but does not change that the key near term swing factor is how quickly inventories normalize and factory underutilization charges ease, with high debt remaining a central risk.
Among recent announcements, the launch of the MCPF1525 high density power module for PCIe switches and AI servers ties directly into the same AI and edge compute theme as the MCU and MPU edge AI stack. Together, they broaden Microchip’s participation in AI related workloads, from ultra low power endpoints to data center infrastructure, which could matter for revenue momentum if the current recovery in industrial, auto and data center demand holds.
Yet, while edge AI expansion looks promising, investors should still be aware of the company’s high leverage and the possibility that prolonged inventory normalization could…
Read the full narrative on Microchip Technology (it’s free!)
Microchip Technology’s narrative projects $6.6 billion revenue and $1.4 billion earnings by 2028. This requires 15.9% yearly revenue growth and an earnings increase of about $1.6 billion from -$178.4 million today.
Uncover how Microchip Technology’s forecasts yield a $86.96 fair value, a 8% upside to its current price.
MCHP 1-Year Stock Price Chart
Some of the most optimistic analysts were already modeling Microchip to reach about US$8.4 billion in revenue and US$2.1 billion in earnings by 2028, and they lean heavily on faster growth from AI centric tools and advanced controllers compared with the baseline focus on inventory and leverage; the latest edge AI news could reinforce that view or prompt a rethink, and as a shareholder you should weigh these very different narratives side by side.
Explore 5 other fair value estimates on Microchip Technology – why the stock might be worth less than half the current price!
Disagree with existing narratives? Create your own in under 3 minutes – extraordinary investment returns rarely come from following the herd.
A great starting point for your Microchip Technology research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.
Our free Microchip Technology research report provides a comprehensive fundamental analysis summarized in a single visual – the Snowflake – making it easy to evaluate Microchip Technology’s overall financial health at a glance.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include MCHP.
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