Microchip is aiming to double its semiconductor sales in Europe over the next five years.
This despite the effects of the market downturn in the last 12 months and the continuing exodus of manufacturing and design to China.
“We are looking at a nice recovery,” said Steve Sanghi, president and CEO of Microchip Technology.
“It is looking like a classic v-shaped recovery and I expect in two to three quarters to be back on record revenues again,” said Sanghi.
He was speaking at the opening the semiconductor company’s new European headquarters situated near Reading in the UK.
“I still feel we can double sales in Europe, which stand at around $250m, and we will need significantly more people to do it,” said Sanghi.
"Recovery in China is here to stay, there is recovery in the US but it is fragile. The recovery in Europe is a little behind but gathering steam now," said Sanghi.
During the downturn of the last year Sanghi said the company prided itself on not making any layoffs. Instead everyone took a pay-cut and bonuses and expenses were cut.
“From the peak to the bottom of the downturn we cut costs by 25%,” said Sanghi.
Microchip, which still manufactures 90% of its microcontrollers, analogue and memory chips in its own fabs, cut capitalisation in its manufacturing facilities by as much as 45% in the downturn.
But also during the downturn Sanghi made three acquisitions and doubled capacity of Microchip’s assembly plant in Thailand. “This will enable us to capitalise on the recovery,” he said.
With some chip suppliers pushing lead times into double figures on many parts as demand returns, Sanghi says that Microchip has lead times of seven weeks or less on 90% of its products.
Microcontrollers are Microchip's core business and will account for around $730m of sales this year.
It has strong 8-bit and 16-bit PIC microcontroller lines and is now ramping up its 32-bit PIC32 microcontroller family.
"In one to two years we expect to have 2,000 customers in volume production with products using PIC32 parts," said Sanghi.
"32-bit is growing at a similar as 16-bit," he added.
But 8-bit is still Microchip's biggest business and Sanghi also sees significant growth potential in the 16-bit MCU market.