Microchip Founder Sanghi Sells $36.9M MCHP Before Earnings

On April 23, 2026, Steve Sanghi — the co-founder who came out of retirement to run Microchip Technology — sold 416,581 shares in a single block at $88.5329 apiece, raising roughly $36.9 million. The Form 4 (accession number 0001181928-26-000018) records it as an open-market sale, code S, and the timing is what makes it worth a second look: it landed about two weeks before Microchip reported fiscal fourth-quarter results on May 7 that showed revenue up 35% year over year. A founder-CEO trimming into a recovery he personally engineered is a more interesting story than the dollar figure alone.

The differentiated context is the man and the moment. Sanghi did not just sell a block; he sold it in the middle of one of the more closely watched turnarounds in semiconductors. He returned as permanent CEO and President to execute a nine-point recovery plan after Microchip's brutal 2024–2025 inventory correction, and the April sale sits against a backdrop of the plan visibly working. The right read is not "CEO loses faith" — it is a long-tenured founder, sitting on a position built over three decades, taking a slice off the table as the stock recovered, while still holding the overwhelming majority of his shares.

The ownership picture, stated correctly

This is where a Form 4 scan goes wrong if you read only one line. After the April 23 sale, Sanghi's directly held Microchip position stood at 9,495,805 shares per Form 4 Table I — and on top of that, the filing shows roughly 10.2 million additional shares held through derivative and indirect structures reported in Table II. Combined, that is a stake worth well over a billion dollars at the sale price. He did not exit; the $36.9 million block represents a low-single-digit percentage of what he controls. Earlier in the same month, on April 1, Sanghi also received several tranches of restricted stock as compensation (code A), which is grant activity, not sentiment — a reminder that award, sale, and gift transactions on a single insider's record measure very different things.

It is also worth being precise about scale relative to the cap table. Sanghi is among the largest individual holders of Microchip, but he is not its largest shareholder; index complexes dominate the register. BlackRock and Vanguard's index funds sit atop the 13F holder list because of benchmark weight, not conviction. The actively managed names worth watching are different animals: value shop Boston Partners, Invesco, and Victory Capital all carry meaningful MCHP positions and represent discretionary money with a view on the recovery.

Why the turnaround backdrop matters

Microchip's fiscal 2026 was a recovery year by the numbers. Fourth-quarter revenue came in at $1.311 billion, up 10.6% sequentially and 35.1% year over year, with non-GAAP gross margin back near 61.6%. Management declared the inventory correction complete — days of inventory fell to 185 from a peak of 266 — and full-year net sales reached $4.713 billion. Sanghi has flagged that lead times are extending again and that substrate and foundry constraints are emerging, the kind of supply-side tightness that typically precedes an upcycle rather than a downturn. Against that, an April sale at $88.53 reads as a founder monetizing a portion of a position after the stock had already recovered substantially off its correction lows, not a signal that the recovery is stalling.

Sanghi's broader filing trail underlines that this is a portfolio decision by a serial board member, not a one-company bet unwinding. In May 2026 his Form 4 activity included option exercises tied to his board seat at RFID maker Impinj and at Intel, where he also serves as a director — transactions on entirely different tickers that have nothing to do with his Microchip conviction. Conflating those exercises with the MCHP sale is exactly the kind of error that turns a clean data story into a misleading one.

What to actually watch next

The forward markers are concrete. Microchip's next scheduled catalyst is its fiscal first-quarter 2027 report (the quarter ending June 30, 2026), expected in early August 2026 — the test of whether the 35% year-over-year growth rate holds as comparisons get harder and whether gross margin keeps climbing toward management's long-term target. On supply, watch the lead-time and foundry-constraint commentary Sanghi has been flagging; a worsening would pressure delivery, an easing would support margin. And on the insider side, the thing to track on Sanghi's transaction history is cadence: a single April block is noise, but a repeating pattern of large sales at higher prices through the back half of 2026 would be the line worth flagging. One $36.9 million sale against a nine-figure retained stake is not it.

FAQ

Did Steve Sanghi sell all his Microchip stock? No. He sold 416,581 shares for about $36.9 million on April 23, 2026, but retains 9,495,805 shares directly per Form 4 Table I plus roughly 10.2 million shares via derivative and indirect holdings in Table II — a stake worth well over a billion dollars.

Why did Sanghi sell MCHP before earnings? The block sold about two weeks before Microchip's May 7, 2026 fiscal Q4 report. The cleanest read is a founder taking a slice off the table after the stock recovered from the 2024–2025 downturn, not a loss of conviction — the company reported 35% year-over-year revenue growth shortly after.

Is Steve Sanghi still Microchip's CEO? Yes. Sanghi co-founded Microchip, led it for roughly three decades, and returned as permanent CEO and President to execute the company's nine-point recovery plan after the inventory correction.

When is Microchip's next earnings report? Microchip's fiscal first-quarter 2027 results (quarter ending June 30, 2026) are expected in early August 2026, the next test of whether its revenue growth and margin recovery continue.