Microchip Technology Incorporated MCHP

The business

Microchip sells the small controller that runs the thing you do not think about. The chip in a garage door opener, an insulin pump, a thermostat, an industrial motor drive. Mixed-signal microcontrollers are half the revenue and analog is another quarter, sold to roughly 102,000 customers of whom the largest ten are about 11% of revenue combined.

That is the opposite of the concentration risk everywhere else in semiconductors, and it is the whole character of this company. Nobody design-wins a Microchip part and then leaves, because the part costs two dollars and requalifying costs a year. It also means Microchip cannot grow faster than the industrial economy it sells into, and when that economy destocks, Microchip finds out last and recovers last.