Semiconductor stock crashing! The difference between Microchip and others

It is shocking to read the news reports, where share prices of leading chip companies falling suddenly due to the announcement made by Microchip, where Microchip's CEO Steve Sanghi alerted that an industry correction has begun, which means the down part of semiconductor sales revenue cycle is approaching in the fourth quarter of 2014. This looks to be unfounded fear, because Microchip's performance is hardly a best sample of semiconductor chip market. First of all, semiconductor sales revenue still has not reached its normal peak, what is seen in earlier cycles. Even if there is a correction it is going to be short lived. Let's look at how Microchip is different from many other semiconductor companies: Microchip is a semiconductor chip company which generates significant part of its revenue from microcontroller chips, particularly in the 8-bit and 16-bit area. Microchip is one of the top three vendor in 8-bit and 16-bit microcontroller market. If you look at the latest sales trend in the microcontroller market, much of the growth in revenue is happening in 32-bit space, more so with the ARM Cortex M processor core-based microcontrollers. 32-bit ARM Cortex M microcontrollers are suggested as better replacement for 8-bit and 16-bit microcontrollers, and the embedded systems industry is quickly adopting to 32-bit ARM Cortex eco. According to the latest figures, the sales ...