In the dynamic semiconductor industry, Microchip Technology Incorporated (MCHP) and Cirrus Logic, Inc. (CRUS) stand out as key players with distinct approaches to innovation and market focus. Microchip offers a broad range of embedded control solutions, while Cirrus specializes in high-precision mixed-signal processing for audio and industrial applications. This comparison highlights their strategies and growth potential to help you decide which company is a more compelling investment opportunity.
Table of contents
Companies Overview
I will begin the comparison between Microchip Technology Incorporated and Cirrus Logic, Inc. by providing an overview of these two companies and their main differences.
Microchip Technology Incorporated Overview
Microchip Technology Incorporated develops, manufactures, and sells embedded control solutions globally, focusing on microcontrollers, microprocessors, analog and mixed-signal products, memory, and timing systems. Headquartered in Chandler, Arizona, it serves diverse markets including automotive, industrial, computing, and communications. With a market cap of about 40.2B USD and 22,300 employees, Microchip emphasizes secure and connected smart device applications.
Cirrus Logic, Inc. Overview
Cirrus Logic, Inc. is a fabless semiconductor company specializing in low-power, high-precision mixed-signal processing solutions. Based in Austin, Texas, it targets audio and industrial applications with products like smart codecs, amplifiers, and signal processors, used in consumer electronics and automotive systems. The company has a market cap near 6.3B USD and employs around 1,609 people, focusing on enhancing user experience through advanced audio technologies.
Key similarities and differences
Both companies operate in the semiconductor industry and provide specialized integrated circuits, but Microchip offers a broader portfolio including microcontrollers and memory products, while Cirrus Logic focuses on mixed-signal audio and industrial solutions. Microchip operates as a manufacturer with diverse end-markets, whereas Cirrus Logic is fabless, concentrating on design and intellectual property. Their scale and employee counts also differ significantly, reflecting their distinct business models.
Income Statement Comparison
The table below compares key income statement metrics for Microchip Technology Incorporated and Cirrus Logic, Inc. based on their most recent fiscal year data.
| Metric | Microchip Technology Incorporated | Cirrus Logic, Inc. |
|---|---|---|
| Market Cap | 40.2B | 6.3B |
| Revenue | 4.40B | 1.90B |
| EBITDA | 1.04B | 497M |
| EBIT | 290M | 445M |
| Net Income | -0.5M | 332M |
| EPS | -0.005 | 6.24 |
| Fiscal Year | 2025 | 2025 |
Income Statement Interpretations
Microchip Technology Incorporated
Microchip Technology’s revenue and net income have shown a declining trend from 2021 to 2025, with revenue dropping from 5.44B to 4.40B in 2025. Gross margins remained relatively stable around 56%, but net margins turned negative in 2025, reflecting a net loss. The recent year saw a sharp slowdown in growth, with net income falling drastically, signaling operational challenges.
Cirrus Logic, Inc.
Cirrus Logic experienced overall revenue growth from 1.37B in 2021 to 1.90B in 2025, accompanied by consistent net income increases. Margins improved, with a strong gross margin near 53% and a net margin exceeding 17% in 2025. The latest year showed modest revenue growth but marked improvements in profitability metrics, indicating solid operational efficiency gains.
Which one has the stronger fundamentals?
Cirrus Logic demonstrates stronger fundamentals with favorable growth in revenue, net income, and margins over the period, including a robust net margin of 17.48%. In contrast, Microchip Technology faces unfavorable trends, including declining revenue and a negative net margin in 2025. The overall income statement evaluations favor Cirrus Logic’s financial health and growth consistency.
Financial Ratios Comparison
The table below presents the most recent financial ratios for Microchip Technology Incorporated (MCHP) and Cirrus Logic, Inc. (CRUS) for fiscal year 2025, offering a snapshot of their profitability, liquidity, leverage, efficiency, and dividend metrics.
| Ratios | Microchip Technology Incorporated (MCHP) | Cirrus Logic, Inc. (CRUS) |
|---|---|---|
| ROE | -0.007% | 17.01% |
| ROIC | -0.027% | 14.20% |
| P/E | -52021 | 15.95 |
| P/B | 3.67 | 2.71 |
| Current Ratio | 2.59 | 6.35 |
| Quick Ratio | 1.47 | 4.82 |
| D/E | 0.80 | 0.07 |
| Debt-to-Assets | 36.9% | 6.18% |
| Interest Coverage | 1.18 | 457.0 |
| Asset Turnover | 0.29 | 0.81 |
| Fixed Asset Turnover | 3.72 | 6.62 |
| Payout ratio | -1951.4 | 0 |
| Dividend yield | 3.75% | 0 |
Interpretation of the Ratios
Microchip Technology Incorporated
Microchip’s financial ratios present a mixed picture with several unfavorable metrics, including negative net margin, ROE, and ROIC, signaling potential profitability and efficiency concerns. The company shows strength in liquidity with a current ratio of 2.59 and a favorable dividend yield of 3.75%. Dividend payments appear supported, but caution is warranted given some weak coverage ratios and negative returns.
Cirrus Logic, Inc.
Cirrus Logic exhibits generally favorable financial ratios, such as a strong net margin of 17.48%, robust ROE of 17.01%, and solid ROIC of 14.2%, reflecting operational efficiency and profitability. The company does not pay dividends, likely due to its reinvestment strategy and focus on R&D, supported by high liquidity and low debt levels, which align with growth priorities and controlled risk.
Which one has the best ratios?
Cirrus Logic holds the advantage with predominantly favorable ratios, including strong profitability and low debt, whereas Microchip faces several unfavorable profitability and efficiency metrics despite solid liquidity and dividend yield. Overall, Cirrus Logic’s ratios are assessed as favorable, contrasting with Microchip’s slightly unfavorable profile.
Strategic Positioning
This section compares the strategic positioning of Microchip Technology Incorporated and Cirrus Logic, Inc., including Market position, Key segments, and exposure to disruption:
Microchip Technology Incorporated
- Large market cap near 40B, operating in a competitive semiconductor industry.
- Offers diversified semiconductor products including microcontrollers, analog, memory, and licensing revenues.
- Faces exposure to technological change in embedded control and analog semiconductor markets.
Cirrus Logic, Inc.
- Smaller market cap around 6.3B, also in semiconductors with moderate competitive pressure.
- Focused on portable audio and high-performance mixed-signal products with specialized audio technologies.
- Exposed to rapid innovation in audio processing, mixed-signal ICs, and power management technologies.
Microchip Technology Incorporated vs Cirrus Logic, Inc. Positioning
Microchip adopts a diversified product portfolio across multiple semiconductor categories, creating broad market coverage but higher complexity. Cirrus Logic concentrates on audio and mixed-signal niches, enabling focused innovation but narrower market scope.
Which has the best competitive advantage?
Cirrus Logic shows a strong and growing economic moat with ROIC above WACC, indicating durable value creation. Microchip exhibits declining ROIC below WACC, signaling value destruction and weaker competitive advantage.
Stock Comparison
The stock price chart highlights significant divergent movements over the past 12 months, with Microchip Technology Incorporated showing a general decline yet recent upward momentum, while Cirrus Logic, Inc. experienced a strong overall rise but a recent pullback.
Trend Analysis
Microchip Technology Incorporated’s stock showed a bearish trend over the past year with a -10.13% price change, marked by accelerating decline and high volatility (std dev 14.38). Recently, it reversed with a 19.27% gain, indicating short-term recovery.
Cirrus Logic, Inc. exhibited a bullish trend over the last year with a 34.06% price increase and decelerating momentum, alongside similar volatility (std dev 14.46). However, recent weeks saw a -7.06% decline, signaling short-term weakness.
Comparing the two, Cirrus Logic delivered the highest market performance over the 12-month period despite its recent downturn, while Microchip Technology faced a notable yearly loss but showed recent acceleration in gains.
Target Prices
The consensus target prices for Microchip Technology Incorporated and Cirrus Logic, Inc. suggest positive upside potential.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Microchip Technology Incorporated | 85 | 60 | 77.44 |
| Cirrus Logic, Inc. | 155 | 100 | 138.75 |
Analysts expect Microchip Technology’s stock to rise modestly above its current price of 74.45 USD, while Cirrus Logic shows a stronger upside from 123.28 USD, reflecting greater growth optimism.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Microchip Technology Incorporated (MCHP) and Cirrus Logic, Inc. (CRUS):
Rating Comparison
MCHP Rating
- Rating: C-, rated as Very Favorable overall despite low scores.
- Discounted Cash Flow Score: 3, indicating a moderate valuation outlook.
- ROE Score: 1, showing very unfavorable profitability from shareholders’ equity.
- ROA Score: 1, indicating very unfavorable asset utilization efficiency.
- Debt To Equity Score: 1, suggesting very unfavorable financial risk profile.
- Overall Score: 1, classified as very unfavorable financial standing.
CRUS Rating
- Rating: A-, rated as Very Favorable with strong financial metrics.
- Discounted Cash Flow Score: 4, indicating a favorable valuation outlook.
- ROE Score: 4, showing favorable profitability from shareholders’ equity.
- ROA Score: 5, indicating very favorable asset utilization efficiency.
- Debt To Equity Score: 3, indicating a moderate financial risk profile.
- Overall Score: 4, classified as favorable financial standing.
Which one is the best rated?
Based strictly on the provided data, CRUS is better rated than MCHP across all key financial metrics, showing stronger profitability, asset efficiency, and a healthier financial risk profile.
Scores Comparison
The following table compares the Altman Z-Score and Piotroski Score for Microchip Technology Incorporated and Cirrus Logic, Inc.:
MCHP Scores
- Altman Z-Score: 4.00, indicating a safe zone from distress
- Piotroski Score: 3, classified as very weak financial health
CRUS Scores
- Altman Z-Score: 11.94, indicating a safe zone from distress
- Piotroski Score: 7, classified as strong financial health
Which company has the best scores?
Based strictly on the provided data, CRUS has both a higher Altman Z-Score and a significantly stronger Piotroski Score than MCHP, suggesting better financial stability and strength.
Grades Comparison
The following presents the recent grades from reputable financial institutions for both companies:
Microchip Technology Incorporated Grades
This table shows the latest grades assigned by recognized grading companies for Microchip Technology Incorporated.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Piper Sandler | Maintain | Overweight | 2026-01-15 |
| B. Riley Securities | Maintain | Buy | 2026-01-12 |
| Mizuho | Maintain | Outperform | 2026-01-09 |
| Wells Fargo | Maintain | Equal Weight | 2026-01-07 |
| JP Morgan | Maintain | Overweight | 2026-01-06 |
| Morgan Stanley | Maintain | Equal Weight | 2026-01-06 |
| Stifel | Maintain | Buy | 2026-01-06 |
| Rosenblatt | Maintain | Buy | 2026-01-06 |
| Needham | Maintain | Buy | 2026-01-06 |
| Cantor Fitzgerald | Upgrade | Overweight | 2025-12-16 |
Microchip Technology Incorporated’s grades predominantly indicate a positive outlook, with most firms maintaining buy or overweight ratings and one recent upgrade.
Cirrus Logic, Inc. Grades
This table shows the latest grades assigned by recognized grading companies for Cirrus Logic, Inc.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Keybanc | Maintain | Overweight | 2025-11-05 |
| Barclays | Maintain | Equal Weight | 2025-11-05 |
| Stifel | Maintain | Buy | 2025-11-05 |
| Benchmark | Maintain | Buy | 2025-11-05 |
| Susquehanna | Maintain | Positive | 2025-10-22 |
| Stifel | Maintain | Buy | 2025-10-17 |
| Stifel | Maintain | Buy | 2025-09-12 |
| Barclays | Maintain | Equal Weight | 2025-05-07 |
| Barclays | Maintain | Equal Weight | 2025-04-22 |
| Stifel | Maintain | Buy | 2025-04-17 |
Cirrus Logic, Inc. also shows a generally positive consensus with multiple buy and overweight ratings, though with some equal weight ratings as well.
Which company has the best grades?
Microchip Technology Incorporated has received a stronger and more recent set of buy and overweight ratings compared to Cirrus Logic, Inc., suggesting a more favorable professional outlook. This could impact investor sentiment by indicating potentially higher confidence in Microchip’s near-term performance.
Strengths and Weaknesses
Below is a comparative overview of key strengths and weaknesses for Microchip Technology Incorporated (MCHP) and Cirrus Logic, Inc. (CRUS) based on their latest performance and financial metrics.
| Criterion | Microchip Technology Incorporated (MCHP) | Cirrus Logic, Inc. (CRUS) |
|---|---|---|
| Diversification | Moderate; mainly semiconductor products with a smaller technology licensing segment | Moderate; focuses on portable audio and high-performance mixed signal products |
| Profitability | Unfavorable; negative net margin and ROIC, value destroying | Favorable; strong net margin (17.5%) and ROIC (14.2%), value creating |
| Innovation | Declining ROIC trend indicates challenges in sustaining competitive edge | Growing ROIC trend shows durable competitive advantage and innovation |
| Global presence | Established global semiconductor supplier but facing profitability issues | Solid international footprint in audio technology with increasing profitability |
| Market Share | Large market in semiconductor products but recent declining returns | Niche market leader in audio ICs with stable revenue growth |
Key takeaways: Cirrus Logic demonstrates a robust and growing profitability with a durable competitive moat, making it a stronger candidate for investment. Microchip Technology, despite its scale, is currently shedding value with declining returns, warranting caution for investors.
Risk Analysis
Below is a comparative risk assessment table for Microchip Technology Incorporated (MCHP) and Cirrus Logic, Inc. (CRUS) based on the latest 2025 data.
| Metric | Microchip Technology Incorporated (MCHP) | Cirrus Logic, Inc. (CRUS) |
|---|---|---|
| Market Risk | High beta at 1.445 indicates higher volatility risk | Moderate beta at 1.084, lower volatility risk |
| Debt Level | Moderate debt-to-equity ratio of 0.8, interest coverage low at 1.15 | Low debt-to-equity ratio 0.07, strong interest coverage 495.45 |
| Regulatory Risk | Exposure due to global manufacturing and semiconductor regulations | Moderate exposure, focus on fabless semiconductor model |
| Operational Risk | Large workforce (22.3K), complex manufacturing, moderate asset turnover (0.29) | Smaller workforce (1.6K), higher asset turnover (0.81), less operational complexity |
| Environmental Risk | Manufacturing processes likely contribute to higher environmental impact | Fabless model reduces direct environmental footprint |
| Geopolitical Risk | Operations in Americas, Europe, Asia with potential supply chain vulnerabilities | Mainly US-based operations but global sales, moderate geopolitical exposure |
Microchip faces higher market and operational risks with moderate leverage and tight interest coverage, signaling potential financial strain. Cirrus Logic shows favorable financial health with low debt and strong profitability, reducing risk. Market volatility and supply chain disruptions remain the most impactful risks for both.
Which Stock to Choose?
Microchip Technology Incorporated (MCHP) shows a significant decline in income with a -42.35% revenue drop in 2025, unfavorable profitability, and a slightly unfavorable financial ratio profile. The company carries moderate debt and a very favorable rating of C-, despite value destruction and declining ROIC.
Cirrus Logic, Inc. (CRUS) demonstrates favorable income growth with a 5.99% revenue increase and strong profitability, supported by a favorable financial ratio profile. The company maintains low debt levels and a very favorable rating of A-, with a durable competitive advantage and growing ROIC.
For investors prioritizing growth and strong financial health, CRUS might appear more favorable, given its consistent value creation and positive income evolution. Conversely, those with risk tolerance aware of MCHP’s financial challenges might interpret opportunities differently based on their strategy.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Microchip Technology Incorporated and Cirrus Logic, Inc. to enhance your investment decisions:
