Microchip closes fab in Arizona in September 2025

Cloudy business weather Microchip closes fab in Arizona in September 2025

2024-12-04 From Susanne Braun | Translated by AI 1 min Reading Time

Related Vendors

Demand for Microchip products is not as high as expected and stocks are full. This prompts the company's managers to reduce production capacity by closing Fab 2 in Arizona.

Microchip's production capacities are to be reduced, which is why it was decided to close Fab 2 in Tempe, Arizona.(Image: Microchip) — Microchip's production capacities are to be reduced, which is why it was decided to close Fab 2 in Tempe, Arizona.
(Image: Microchip)

It was only in November 2024 that the management of Microchip announced that CEO Ganesh Moorthy would be retiring at the end of the month. Steve Sanghi, who has taken a close look at the business outlook in recent weeks, was appointed interim CEO. The result is an updated sales forecast on the one hand and a restructuring of production on the other.

"We indicated in our November 5, 2024 conference call that significantly higher order intake would be required to reach the midpoint of our December 2024 quarter revenue guidance," said Sanghi. "These turnaround orders have come in slower than expected and we now expect our December 2024 revenue to be at the lower end of our original guidance of USD 1.025 billion."

Full warehouses, low production requirements

The warehouses are full and there is also sufficient production capacity available, according to the statement. As a result, it was decided to close Microchip's Fab 2 in Tempe, Arizona, in September 2025. Many of the processes used at the site are also available at the fabs in Oregon and Colorado, which is why the decision was made to close the plant. It is hoped that this will result in savings of around 90 million US dollars.

"The restructuring of the manufacturing facility is a major step in downsizing our manufacturing footprint, and we will continue to evaluate any further actions necessary to position Microchip for superior growth and financial performance," concluded Sanghi. Microchip did not discuss the social impact of the fab closures in the official announcement (MCHP Updates Guidance and Announces Manufacturing Restructuring Plans 120224.pdf). (sb)

Subscribe to the newsletter now

Don't Miss out on Our Best Content

Business E-mail

Please enter a valid mailadress.

By clicking on „Subscribe to Newsletter“ I agree to the processing and use of my data according to the consent form (please expand for details) and accept the Terms of Use. For more information, please see our Privacy Policy. The consent declaration relates, among other things, to the sending of editorial newsletters by email and to data matching for marketing purposes with selected advertising partners (e.g., LinkedIn, Google, Meta)

Date: 08.12.2025

Naturally, we always handle your personal data responsibly. Any personal data we receive from you is processed in accordance with applicable data protection legislation. For detailed information please see our privacy policy.

Consent to the use of data for promotional purposes

I hereby consent to Vogel Communications Group GmbH & Co. KG, Max-Planck-Str. 7-9, 97082 Würzburg including any affiliated companies according to §§ 15 et seq. AktG (hereafter: Vogel Communications Group) using my e-mail address to send editorial newsletters. A list of all affiliated companies can be found here

Newsletter content may include all products and services of any companies mentioned above, including for example specialist journals and books, events and fairs as well as event-related products and services, print and digital media offers and services such as additional (editorial) newsletters, raffles, lead campaigns, market research both online and offline, specialist webportals and e-learning offers. In case my personal telephone number has also been collected, it may be used for offers of aforementioned products, for services of the companies mentioned above, and market research purposes.

Additionally, my consent also includes the processing of my email address and telephone number for data matching for marketing purposes with select advertising partners such as LinkedIn, Google, and Meta. For this, Vogel Communications Group may transmit said data in hashed form to the advertising partners who then use said data to determine whether I am also a member of the mentioned advertising partner portals. Vogel Communications Group uses this feature for the purposes of re-targeting (up-selling, cross-selling, and customer loyalty), generating so-called look-alike audiences for acquisition of new customers, and as basis for exclusion for on-going advertising campaigns. Further information can be found in section “data matching for marketing purposes”.

In case I access protected data on Internet portals of Vogel Communications Group including any affiliated companies according to §§ 15 et seq. AktG, I need to provide further data in order to register for the access to such content. In return for this free access to editorial content, my data may be used in accordance with this consent for the purposes stated here. This does not apply to data matching for marketing purposes.

Right of revocation

I understand that I can revoke my consent at will. My revocation does not change the lawfulness of data processing that was conducted based on my consent leading up to my revocation. One option to declare my revocation is to use the contact form found at https://contact.vogel.de. In case I no longer wish to receive certain newsletters, I have subscribed to, I can also click on the unsubscribe link included at the end of a newsletter. Further information regarding my right of revocation and the implementation of it as well as the consequences of my revocation can be found in the data protection declaration, section editorial newsletter.