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MCHP Expands Ethernet Portfolio: Can it Challenge TXN & ADI?

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Key Takeaways

  • Microchip launched new 10BASE-T1S transceivers and endpoints for automotive, industrial and other markets.
  • The expanded portfolio can connect eight or more nodes on one bus, reducing wiring, costs and gateways.
  • Industrial and automotive revenues rose 24.3% and 29.3%, respectively, in Microchip's fiscal first quarter.

Microchip Technology (MCHP - Free Report) has expanded its 10BASE-T1S Single Pair Ethernet portfolio with the launch of the LAN8679 and LAN8680 PMD transceivers and the LAN8660X/1X/2X endpoint family with integrated transceivers. The products are designed for next-generation zonal architectures across automotive, industrial, robotics and aerospace and defense applications, extending Ethernet connectivity to edge nodes while reducing wiring and system complexity. The portfolio combines transceivers, endpoint functionality, power management and embedded-control capabilities, thereby supporting MCHP’s broader Total System Solutions strategy. It also improves competitive prowess against the likes of Texas Instruments (TXN - Free Report) and Analog Devices (ADI - Free Report) .

The LAN8679 features an Open Alliance 3-Pin interface in a compact package, while the LAN8680 adds power management, wake as well as sleep control and watchdog supervision. The LAN8660X/1X/2X family integrates a transceiver into a single-chip Remote Control Protocol solution, eliminating the need for external PHY components in applications such as control systems, lighting and audio. Microchip’s 10BASE-T1S multidrop architecture can connect eight or more nodes over a single bus, helping reduce wiring weight, costs and gateway requirements. 

The portfolio expansion strengthens Microchip’s connectivity and networking growth strategy. The company identifies connectivity/networking as one of its new strategic growth pillars, targeting opportunities across Industry 4.0, automotive and data-center applications. MCHP highlights Single Pair Ethernet as a roughly $4-billion served available market, spanning automotive, aerospace, robotics, industrial vehicles, building controls, industrial controls, sensors, actuators and vehicle networking. The company also sees billions of legacy nodes as potential replacement opportunities, giving the expanded portfolio a sizable long-term addressable market.

The launch is also well timed with improving demand in MCHP’s two largest target markets for these products. In the first quarter of fiscal 2027, industrial represented 32.2% of revenues and automotive accounted for 15%. Industrial revenues increased 24.3% year over year, while automotive revenues jumped 29.3%. Industrial and automotive customers had largely completed inventory corrections, and Microchip noted that clients were placing a higher number of orders, while bookings remained strong across product lines, business units and geographies. The new devices are expected to help Microchip capture more semiconductor content as automotive and industrial networks migrate from fragmented legacy architectures toward consolidated Ethernet-based systems.

MCHP Faces Tough Competition

Texas Instruments’ DP83TD555 targets 10BASE-T1S connectivity, while ADI’s AD3300/AD3301 family brings integrated Ethernet connectivity to edge sensors and actuators.

Texas Instruments is challenging Microchip across automotive and industrial connectivity through its broad Analog and Embedded Processing portfolio, strong manufacturing capacity and growing semiconductor content per system. In the second quarter of 2026, TXN’s industrial revenues increased roughly 30% year over year, while automotive revenues rose in the mid-teens. Texas Instruments’ supply capabilities further intensify the challenge. The company has available clean-room space and is expanding production capacity to address rising demand.

Analog Devices poses a significant challenge through its high-performance analog, sensing, power and embedded technologies. Industrial accounted for 49% of ADI’s third-quarter fiscal 2026 revenues and increased 53% year over year, led partly by automation, while automotive represented 25% of revenues and grew 16%. ADI said its higher content and share positions are driving automotive growth across next-generation ADAS, infotainment and electric powertrains. ADI is also positioning for the emergence of physical AI, including robotics and autonomous mobility.

MCHP’s Share Price Performance, Valuation & Estimates

Shares of Microchip have appreciated 22% year to date, outperforming the broader Zacks Computer and Technology sector’s rise of 21.8%.

MCHP Stock’s Price Performance

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

The MCHP stock is trading at a premium, with a trailing price/book multiple of 6.55 compared with the Zacks Semiconductor – Analog and Mixed industry’s 6.48. Microchip has a Value Score of D.

MCHP’s Valuation

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

The Zacks Consensus Estimate for Microchip’s fiscal 2027 earnings is currently pegged at $3.63 per share, up 15.6% over the past 30 days, suggesting 121.3% growth from fiscal 2026’s reported figure.
 

 

 

Microchip currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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