Microchip now expects its net sales for its second fiscal quarter to be up 12-to-14 percent sequentially. Microchip expects GAAP diluted earnings per share to be approximately 20-to-22 cents and non-GAAP diluted earnings per share to be approximately 26-to-27 cents.

On Aug. 6, Microchip had provided guidance of net sales increasing 7-to-11 percent sequentially, GAAP diluted earnings per share of approximately 18-to-20 cents, and non-GAAP diluted earnings per share of approximately 23-to-26 cents.

"We are experiencing strong demand for all of our microcontroller and analog product families in the quarter with out 16-bit microcontrollers providing the highest sequential growth,'' said Steve Sanghi, Microchip's President and CEO, in a statement.

''Geographically, we are seeing strong demand in Asia and the Americas. Europe is unseasonably strong with revenue in the summer quarter being sequentially up for the first time in several years,'' he said. ''We also experienced the strongest August bookings in our company's history, and consequently we are seeing strong backlog starting to build for our fiscal third quarter. We now expect inventory on our balance sheet to drop by an additional 5 days, to approximately 103 days in the second fiscal quarter ending September 30, 2009. Therefore, we are accelerating the capacity ramps in all our manufacturing facilities."