Microchip claims Asian markets cause profits dip

Microchip claims Asian markets cause profits dip
Tom Foremski
Microchip Technology is the latest US electronics firm to warn of lower than expected sales and profits in its current fiscal quarter because of weaker demand in Japan and other Asian markets.
The company said that its fiscal fourth quarter results will be about ten percent lower than analyst estimates. Microchip said that sales slowed significantly in Asian market in the fourth quarter continuing a decline that began in late December. Asian markets normally represent about 40 per cent of sales but current sales are running about 30 per cent lower than in the previous quarter.
Sales to European and US customers have increased in the current quarter, but not enough to offset lower Asian sales. The company is hoping to improve its gross profit margins by increasing production of microcontrollers compared with its memory chip products.

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