Microchip Technology Inc (MCHP)

Gross profit margin

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Gross profit	US$ in thousands	2,467,900	4,995,700	5,697,900	4,449,600	3,378,800
Revenue	US$ in thousands	4,401,600	7,634,400	8,438,700	6,820,900	5,438,400
Gross profit margin		56.07%	65.44%	67.52%	65.23%	62.13%

March 31, 2025 calculation

Gross profit margin = Gross profit ÷ Revenue
= $2,467,900K ÷ $4,401,600K
= 56.07%

The gross profit margin of Microchip Technology Inc has displayed fluctuations over the past five years.

- As of March 31, 2021, the gross profit margin stood at 62.13%, indicating that out of every dollar in revenue, 62.13 cents were retained as gross profit after deducting the cost of goods sold.
- By March 31, 2022, the gross profit margin improved to 65.23%, demonstrating an increase in the efficiency of production and sales processes.
- The trend continued to improve in the following year, with the gross profit margin reaching 67.52% as of March 31, 2023. This suggests effective cost management and pricing strategies.
- However, there was a slight dip in performance by March 31, 2024, as the gross profit margin decreased to 65.44%. This could be attributed to changes in the cost structure or pricing pressures.
- The most recent data as of March 31, 2025, shows a significant decline in the gross profit margin to 56.07%. This drop may raise concerns about the company's ability to maintain profitability amidst various challenges.

Overall, fluctuations in the gross profit margin indicate the need for Microchip Technology Inc to closely monitor cost structures, pricing strategies, and operational efficiency to sustain and improve profitability in the future.