Microchip Technology Inc. is a leading semiconductor supplier of smart, connected and secure embedded control solutions. The company’s solutions serve more than 125,000 customers across the industrial, automotive, consumer, aerospace and defense, communications and computing markets. Microchip offers outstanding technical support along with dependable delivery and quality. Presenting the 2021 Industry Outlook, Ganesh Moorthy, President and Chief Operating Officer, Microchip Technology Inc. seemed quite bullish on his company’s performance and stated that year 2021 will be a growth year for the industry.
ELE Times: How did Microchip perform in 2020?
Ganesh Moorthy: Microchip performed well in a year that was otherwise difficult due to the effects of COVID-19. We experienced a combination of supply side shocks and demand side shocks because of the impact COVID-19 had on our operations as well as that of our customers.
ELE Times: What is Microchip’s business outlook in 2021? What are your key strategies and approach to drive growth?
Ganesh Moorthy: We are optimistic that 2021 will be a growth year, coming on the heels of a weak 2019 due to trade and tariff issues and a difficult 2020 because of COVID-19. At Microchip, we see six megatrends that will create opportunities for growth in 2021 and for several years beyond that. The megatrends are:5G, IoT, Datacenter, Electric Vehicles, ADAS/Autonomous Vehicles, Artificial Intelligence/Machine Learning.
Our key strategies to drive growth remain to: Invest in delivering new, innovative solutions, Invest in delivering outstanding technical support and Invest in capital additions required to support our customers’ growth.
ELE Times: How has Covid-19 affected your business and how do you see the impact of the pandemic in the industry moving forward? What is your outlook for the industry in 2021?
Ganesh Moorthy: COVID-19 impacted some parts of our supply chain in the first half of 2020 and also impacted demand from some end markets like automotive, industrial, consumer and commercial aviation. However, other end markets like those associated with work-from-home and medical devices saw strength in 2020 due to COVID-19. We are optimistic that 2021 will be a growth year, coming on the heels of a weak 2019 due to trade and tariff issues and a difficult 2020 because of COVID-19.
ELE Times: What are the key challenges engineers face today? What does Microchip do or is doing to help engineers overcome these difficulties?
Ganesh Moorthy: Engineers remain challenged by the need to deliver innovative solutions that have the right balance of performance and power, provide the software and tools needed to enable faster time to market and whose total cost is competitive for the target applications. Microchip provides engineers the freedom to innovate through our smart, connected and secure total system solutions, as well as our technical support in various forms.
ELE Times: 2020 is the biggest year for mergers and acquisitions in the semiconductor industry. What are your views on the factors driving this trend and what is Microchip’s strategy in response to this development?
Ganesh Moorthy: Semiconductor mergers and acquisitions (M&A) are being driven by insufficient industry growth. As a result, the industry continues to consolidate as it has been for about 10 years. M&A valuations in 2020 were very high and would not meet Microchip’s valuation expectation for sensible M&A.