10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2020

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number:  0-21184

MICROCHIP TECHNOLOGY INCORPORATED

(Exact Name of Registrant as Specified in Its Charter)

Delaware	86-0629024
(State or Other Jurisdiction of Incorporation or Organization)	(IRS Employer Identification No.)

2355 W. Chandler Blvd., Chandler, AZ  85224-6199

(480) 792-7200

(Address, Including Zip Code, and Telephone Number,

Including Area Code, of Registrant's

Principal Executive Offices)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days. Yes  ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  (Check One)

Yes    ☐ No   ☒

Shares Outstanding of Registrant's Common Stock

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered	January 31, 2021
Common Stock, $0.001 par value	MCHP	NASDAQ Stock Market LLC	269,262,013 shares
		(Nasdaq Global Select Market)

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

INDEX

PART I.  FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets – December 31, 2020 and March 31, 2020	4
	Condensed Consolidated Statements of Income – Three and Nine Months Ended December 31, 2020 and 2019	5
	Condensed Consolidated Statements of Comprehensive Income – Three and Nine Months Ended December 31, 2020 and 2019	6
	Condensed Consolidated Statements of Cash Flows – Nine Months Ended December 31, 2020 and 2019	7
	Condensed Consolidated Statements of Changes in Equity - Three and Nine Months Ended December 31, 2020 and 2019	8
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4.	Controls and Procedures	42
PART II.  OTHER INFORMATION
Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	58
Item 6.	Exhibits	59
	Signatures
	Certifications
	Exhibits

2

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

Defined Terms(1)

Term	Definition
3.922% 2021 Notes	2021 Senior Secured Notes, maturing June 1, 2021
4.333% 2023 Notes	2023 Senior Secured Notes, maturing June 1, 2023
2.670% 2023 Notes	2023 Senior Secured Notes, maturing September 1, 2023
0.972% 2024 Notes	2024 Senior Secured Notes, maturing February 15, 2024
4.250% 2025 Notes	2025 Senior Unsecured Notes, maturing September 1, 2025
2015 Senior Convertible Debt	2015 Senior Convertible Debt, maturing February 15, 2025
2017 Senior Convertible Debt	2017 Senior Convertible Debt, maturing February 15, 2027
2020 Senior Convertible Debt	2020 Senior Convertible Debt, maturing November 15, 2024
2017 Junior Convertible Debt	2017 Junior Convertible Debt, maturing February 15, 2037
ASU	Accounting Standards Update
Bridge Loan Facility	364-Day Senior Secured bridge credit agreement which provides for a term loan facility
CEMs	Client engagement managers
Convertible Debt	2015 Senior Convertible Debt, 2017 Senior Convertible Debt, 2020 Senior Convertible Debt, and 2017 Junior Convertible Debt
Credit Agreement	Credit agreement, dated as of May 29, 2018, as subsequently amended, among the Company, as borrower, the lenders from time to time party thereto, J.P.Morgan Chase Bank, N.A., as administrative agent, providing for the Revolving Credit Facility and the Term Loan Facility
EAR	Export Administration Regulation
EEPROM	Electrically erasable programmable read only memory
EERAM	Electrically erasable random access memory
ESEs	Embedded solutions engineers
Exchange Act	Securities Exchange Act of 1934, as amended
FASB	Financial Accounting Standards Board
FPGA	Field-programmable gate array
GILTI	Global Intangible Low-Taxed Income
LIBOR	London Interbank Offered Rate
LMO	Licensing, memory and other
R&D	Research and development
Revolving Credit Facility	$3.57 billion revolving credit facility created pursuant to the Credit Agreement
RF	Radio frequency
RSUs	Restricted stock units
SEC	U.S. Securities and Exchange Commission
Senior Credit Facilities	Revolving Credit Facility and Term Loan Facility
Senior Indebtedness	Revolving Credit Facility, Term Loan Facility, Bridge Loan Facility, 3.922% 2021 Notes, 4.333% 2023 Notes, 2.670% 2023 Notes, 0.972% 2024 Notes, and 4.250% 2025 Notes
Senior Notes	3.922% 2021 Notes, 4.333% 2023 Notes, 2.670% 2023 Notes, 0.972% 2024 Notes, and 4.250% 2025 Notes
SRAM	Static random access memory
TCJA	Tax Cuts and Jobs Act of 2017
Term Loan Facility	$3.0 billion term loan facility created pursuant to the Credit Agreement
U.S. GAAP	U.S. Generally Accepted Accounting Principles

(1) Certain terms used within this Form 10-Q are defined in the above table.

3

PART I.  FINANCIAL INFORMATION

Item 1. Financial Statements

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share and per share amounts)

ASSETS
	December 31,		March 31,
	2020		2020
Cash and cash equivalents	$	370.7	$	401.0
Short-term investments	2.0		2.0
Accounts receivable, net	893.8		934.0
Inventories	666.1		685.7
Other current assets	219.9		194.5
Total current assets	2,152.5		2,217.2
Property, plant and equipment, net	827.4		876.1
Goodwill	6,670.6		6,664.8
Intangible assets, net	5,025.8		5,702.3
Long-term deferred tax assets	1,628.4		1,748.5
Other assets	271.4		217.2
Total assets	$	16,576.1	$	17,426.1
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$	259.8	$	246.8
Accrued liabilities	769.2		781.8
Current portion of long-term debt	1,493.2		608.8
Total current liabilities	2,522.2		1,637.4
Long-term debt	7,647.8		8,873.4
Long-term income tax payable	669.6		668.4
Long-term deferred tax liability	9.9		318.5
Other long-term liabilities	429.6		342.9
Stockholders' equity:
Preferred stock, $0.001 par value; authorized 5,000,000 shares; no shares issued or outstanding	—		—
Common stock, $0.001 par value; authorized 450,000,000 shares; 280,724,898 shares issued and 269,257,744 shares outstanding at December 31, 2020; 258,391,231 shares issued and 245,325,643 shares outstanding at March 31, 2020	0.3		0.2
Additional paid-in capital	2,385.1		2,675.1
Common stock held in treasury: 11,467,154 shares at December 31, 2020; 13,065,588 shares at March 31, 2020	(450.2)		(500.6)
Accumulated other comprehensive loss	(22.3)		(21.6)
Retained earnings	3,384.1		3,432.4
Total stockholders' equity	5,297.0		5,585.5
Total liabilities and stockholders' equity	$	16,576.1	$	17,426.1

See accompanying notes to condensed consolidated financial statements

4

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per share amounts)

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8
Cost of sales	506.3		501.9		1,519.3		1,519.6
Gross profit	845.8		785.5		2,452.0		2,428.2
Research and development	210.1		217.1		607.9		656.0
Selling, general and administrative	154.2		170.7		445.2		510.9
Amortization of acquired intangible assets	231.6		248.7		699.9		745.4
Special charges and other, net	4.3		17.8		8.9		29.5
Operating expenses	600.2		654.3		1,761.9		1,941.8
Operating income	245.6		131.2		690.1		486.4
Other income (expense):
Interest income	0.2		0.6		0.8		2.3
Interest expense	(86.5)		(119.7)		(278.9)		(381.9)
Loss on settlement of debt	(142.1)		—		(214.0)		(2.0)
Other loss, net	(0.4)		(1.5)		(2.9)		(0.2)
Income before income taxes	16.8		10.6		195.1		104.6
Income tax benefit	(19.4)		(300.5)		(38.3)		(366.1)
Net income	$	36.2	$	311.1	$	233.4	$	470.7
Basic net income per common share	$	0.14	$	1.30	$	0.91	$	1.97
Diluted net income per common share	$	0.13	$	1.20	$	0.87	$	1.84
Dividends declared per common share	$	0.3685	$	0.3665	$	1.1040	$	1.0980
Basic common shares outstanding	263.4		239.2		255.7		238.5
Diluted common shares outstanding	275.4		258.3		267.0		255.8

See accompanying notes to condensed consolidated financial statements

5

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net income	$	36.2	$	311.1	$	233.4	$	470.7
Components of other comprehensive (loss) income:
Defined benefit plans:
Actuarial (losses) gains related to defined benefit pension plans, net of tax effect	(3.5)		(1.6)		(6.9)		0.1
Reclassification of realized transactions, net of tax effect	0.3		0.2		0.9		0.6
Change in net foreign currency translation adjustment	1.8		1.7		5.3		(0.7)
Other comprehensive (loss) income, net of tax effect	(1.4)		0.3		(0.7)		—
Comprehensive income	$	34.8	$	311.4	$	232.7	$	470.7

See accompanying notes to condensed consolidated financial statements

6

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

	Nine Months Ended December 31,
	2020		2019
Cash flows from operating activities:
Net income	$	233.4	$	470.7
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	865.5		904.7
Deferred income taxes	(82.9)		(404.2)
Share-based compensation expense related to equity incentive plans	143.3		129.5
Loss on settlement of debt	214.0		2.0
Amortization of debt discount	57.5		90.9
Amortization of debt issuance costs	13.2		12.8
(Gains) losses on sale of assets	(0.9)		0.4
Impairment of intangible assets	—		0.5
Gains on equity investments	(0.2)		(1.0)
Other non-cash adjustment	0.9		2.7
Changes in operating assets and liabilities, excluding impact of acquisitions:
Decrease in accounts receivable	40.2		73.2
Decrease in inventories	17.5		5.6
Increase (decrease) in accounts payable and accrued liabilities	6.6		(53.3)
Change in other assets and liabilities	(23.3)		(3.9)
Change in income tax payable	(17.5)		(58.5)
Net cash provided by operating activities	1,467.3		1,172.1
Cash flows from investing activities:
Purchases of available-for-sale investments	—		(2.0)
Investments in other assets	(73.1)		(40.5)
Proceeds from sale of assets	0.2		0.5
Capital expenditures	(37.2)		(55.7)
Net cash used in investing activities	(110.1)		(97.7)
Cash flows from financing activities: (1)
Payments on settlement of convertible debt	(2,252.2)		—
Proceeds from issuance of senior notes	3,577.8		—
Repayment of bridge loan facility	(615.0)		—
Repayments of term loan facility	(1,723.5)		(188.0)
Proceeds from borrowings on revolving loan under credit facility	3,073.0		682.0
Repayments of revolving loan under credit facility	(3,104.9)		(1,324.0)
Deferred financing costs	(18.3)		(1.8)
Purchase of capped call options	(35.8)		—
Payment of cash dividends	(281.7)		(262.1)
Proceeds from sale of common stock	40.2		38.8
Tax payments related to shares withheld for vested restricted stock units	(46.5)		(50.2)
Capital lease payments	(0.6)		(0.6)
Net cash used in financing activities	(1,387.5)		(1,105.9)
Net decrease in cash and cash equivalents	(30.3)		(31.5)
Cash and cash equivalents, and restricted cash at beginning of period	401.0		428.6
Cash and cash equivalents, and restricted cash at end of period	$	370.7	$	397.1
Supplemental disclosure of cash flow information:
(1) During the nine months ended December 31, 2020, the Company completed the December 2020 settlement of $1,086.5 million principal amount of convertible debt in exchange for $428.9 million in cash, 8.4 million shares of common stock and $665.5 million principal amount of 2020 Senior Convertible Debt. Refer to Note 6 for further information.

See accompanying notes to condensed consolidated financial statements

7

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(in millions)

	Common Stock and Additional Paid-in-Capital			Common Stock Held in Treasury			Accumulated Other Comprehensive Loss		Retained Earnings		Total Equity
	Shares	Amount		Shares	Amount
Balance at March 31, 2019	253.2	$	2,679.8	15.6	$	(582.2)	$	(20.7)	$	3,210.6	$	5,287.5
Net income	—	—		—	—		—		50.7		50.7
Other comprehensive loss	—	—		—	—		(0.3)		—		(0.3)
Adoption of ASU 2018-02, cumulative adjustment	—	—		—	—		(1.3)		1.3		—
Proceeds from sales of common stock through employee equity incentive plans	0.5	7.3		—	—		—		—		7.3
Restricted stock unit and stock appreciation right withholdings	(0.1)	(11.4)		—	—		—		—		(11.4)
Treasury stock used for new issuances	(0.4)	(13.8)		(0.4)	13.8		—		—		—
Share-based compensation	—	41.6		—	—		—		—		41.6
Cash dividend	—	—		—	—		—		(87.1)		(87.1)
Balance at June 30, 2019	253.2	2,703.5		15.2	(568.4)		(22.3)		3,175.5		5,288.3
Net Income	—	—		—	—		—		108.9		108.9
Other comprehensive income	—	—		—	—		—		—		—
Proceeds from sales of common stock through employee equity incentive plans	0.9	20.2		—	—		—		—		20.2
Restricted stock unit and stock appreciation right withholdings	(0.2)	(15.2)		—	—		—		—		(15.2)
Treasury stock used for new issuances	(0.7)	(23.2)		(0.7)	23.2		—		—		—
Share-based compensation	—	46.4		—	—		—		—		46.4
Cash dividend	—	—		—	—		—		(87.3)		(87.3)
Balance at September 30, 2019	253.2	2,731.7		14.5	(545.2)		(22.3)		3,197.1		5,361.3
Net income	—	—		—	—		—		311.1		311.1
Other comprehensive income	—	—		—	—		0.3		—		0.3
Proceeds from sales of common stock through employee equity incentive plans	1.0	11.3		—	—		—		—		11.3
Restricted stock unit and stock appreciation right withholdings	(0.2)	(23.6)		—	—		—		—		(23.6)
Treasury stock used for new issuances	(0.8)	(24.4)		(0.8)	24.4		—		—		—
Share-based compensation	—	43.9		—	—		—		—		43.9
Cash dividend	—	—		—	—		—		(87.7)		(87.7)
Balance at December 31, 2019	253.2	$	2,738.9	13.7	$	(520.8)	$	(22.0)	$	3,420.5	$	5,616.6
Balance at March 31, 2020	258.4	$	2,675.3	13.1	$	(500.6)	$	(21.6)	$	3,432.4	$	5,585.5
Net income	—	—		—	—		—		123.6		123.6

8

	Common Stock and Additional Paid-in-Capital			Common Stock Held in Treasury			Accumulated Other Comprehensive Loss		Retained Earnings		Total Equity
	Shares	Amount		Shares	Amount
Other comprehensive income	—	—		—	—		0.5		—		0.5
Proceeds from sales of common stock through employee equity incentive plans	0.6	11.0		—	—		—		—		11.0
Restricted stock unit and stock appreciation right withholdings	(0.1)	(11.0)		—	—		—		—		(11.0)
Treasury stock used for new issuances	(0.5)	(14.8)		(0.5)	14.8		—		—		—
Shares issued to settle convertible debt	6.6	651.5		—	—		—		—		651.5
Settlement of convertible debt	—	(810.7)		—	—		—		—		(810.7)
Share-based compensation	—	41.3		—	—		—		—		41.3
Cash dividend	—	—		—	—		—		(90.4)		(90.4)
Balance at June 30, 2020	265.0	2,542.6		12.6	(485.8)		(21.1)		3,465.6		5,501.3
Net Income	—	—		—	—		—		73.6		73.6
Other comprehensive income	—	—		—	—		0.2		—		0.2
Proceeds from sales of common stock through employee equity incentive plans	0.7	18.6		—	—		—		—		18.6
Restricted stock unit and stock appreciation right withholdings	(0.1)	(14.4)		—	—		—		—		(14.4)
Treasury stock used for new issuances	(0.6)	(18.8)		(0.6)	18.8		—		—		—
Shares issued to settle convertible debt	7.3	768.7		—	—		—		—		768.7
Settlement of convertible debt	—	(859.4)		—	—		—		—		(859.4)
Share-based compensation	—	50.4		—	—		—		—		50.4
Cash dividend	—	—		—	—		—		(95.3)		(95.3)
Balance at September 30, 2020	272.3	2,487.7		12.0	(467.0)		(20.9)		3,443.9		5,443.7
Net income	—	—		—	—		—		36.2		36.2
Other comprehensive loss	—	—		—	—		(1.4)		—		(1.4)
Proceeds from sales of common stock through employee equity incentive plans	0.7	10.6		—	—		—		—		10.6
Restricted stock unit and stock appreciation right withholdings	(0.2)	(21.1)		—	—		—		—		(21.1)
Treasury stock used for new issuances	(0.5)	(16.8)		(0.5)	16.8		—		—		—
Shares issued to settle convertible debt	8.4	1,160.1		—	—		—		—		1,160.1
Settlement of convertible debt	—	(1,339.0)		—	—		—		—		(1,339.0)
Purchase of capped call options	—	(35.8)		—	—		—		—		(35.8)
Issuance of 2020 Senior Convertible Debt	—	87.7		—	—		—		—		87.7
Share-based compensation	—	52.0		—	—		—		—		52.0
Cash dividend	—	—		—	—		—		(96.0)		(96.0)
Balance at December 31, 2020	280.7	$	2,385.4	11.5	$	(450.2)	$	(22.3)	$	3,384.1	$	5,297.0

See accompanying notes to condensed consolidated financial statements

9

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

Note 1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Microchip Technology Incorporated and its majority-owned and controlled subsidiaries (the Company).  All significant intercompany accounts and transactions have been eliminated in consolidation. All dollar amounts in the financial statements and tables in these notes, except per share amounts, are stated in millions of U.S. dollars unless otherwise noted.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP, pursuant to the rules and regulations of the SEC.  The information furnished herein reflects all adjustments which are, in the opinion of management, of a normal recurring nature and necessary for a fair statement of the results for the interim periods reported. Certain information and footnote disclosures normally included in audited consolidated financial statements have been condensed or omitted pursuant to such SEC rules and regulations.  It is suggested that these condensed consolidated financial statements be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2020.  The results of operations for the three and nine months ended December 31, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2021 or for any other period.

Note 2. Recently Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

On April 1, 2020, the Company adopted the following Accounting Standards Updates, none of which had a material impact on its consolidated financial statements.

Accounting Standards Updates	Description
ASU 2018-15	Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract
ASU 2018-13	Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement
ASU 2017-04	Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment
ASU 2016-13	Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

Recently Issued Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity, which simplifies the guidance for certain convertible debt instruments by removing the separation models for convertible debt with a cash conversion feature or convertible instruments with a beneficial conversion feature. As a result, convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. Additionally, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company expects the primary impacts of this new standard will be to increase the carrying value of its Convertible Debt and reduce its reported interest expense. In addition, the Company will be required to use the if-converted method for calculating diluted earnings per share. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04-Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions to U.S. GAAP for applying guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The guidance is effective upon issuance and may be adopted on any date on or after March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

10

In December 2019, the FASB issued ASU 2019-12-Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This guidance enhances and simplifies various aspects of the income tax accounting standard ASC 740, including requirements related to hybrid tax regimes, the tax basis step-up in goodwill obtained in a transaction that is not a business combination, separate financial statements of entities not subject to tax, the intraperiod tax allocation exception to the incremental approach, ownership changes in investments, interim-period accounting for enacted changes in tax law, and the year-to-date loss limitation in interim-period tax accounting. The amendments are effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

Note 3. Segment Information

The Company's reportable segments are semiconductor products and technology licensing.  The Company does not allocate operating expenses, interest income, interest expense, other income or expense, or provision for or benefit from income taxes to these segments for internal reporting purposes, as the Company does not believe that allocating these expenses is beneficial in evaluating segment performance.  Additionally, the Company does not allocate assets to segments for internal reporting purposes as it does not manage its segments by such metrics.

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2020 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2020				December 31, 2020
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,319.9	$	813.6	$	3,893.9	$	2,374.6
Technology licensing	32.2		32.2		77.4		77.4
Total	$	1,352.1	$	845.8	$	3,971.3	$	2,452.0

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2019 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2019				December 31, 2019
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,257.0	$	755.1	$	3,875.6	$	2,356.0
Technology licensing	30.4		30.4		72.2		72.2
Total	$	1,287.4	$	785.5	$	3,947.8	$	2,428.2

Note 4. Net Sales

The following table represents the Company's net sales by product line (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Microcontrollers	$	726.3	$	685.8	$	2,145.8	$	2,091.8
Analog	372.8		363.3		1,104.7		1,143.6
FPGA	99.1		92.6		294.3		276.8
LMO	153.9		145.7		426.5		435.6
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

The product lines listed above are included entirely in the Company's semiconductor product segment with the exception of the LMO product line, which includes products from both the semiconductor product and technology licensing segments.

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The following table represents the Company's net sales by contract type (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Distributors	$	681.6	$	638.8	$	2,003.7	$	1,970.0
Direct customers	638.3		618.2		1,890.2		1,905.6
Licensees	32.2		30.4		77.4		72.2
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

Distributors are customers that buy products with the intention of reselling them. Distributors generally have a distributor agreement with the Company to govern the terms of the relationship. Direct customers are non-distributor customers, which generally do not have a master sales agreement with the Company. The Company's direct customers primarily consist of OEMs and, to a lesser extent, contract manufacturers. Licensees are customers of the Company's technology licensing segment, which include purchasers of intellectual property and customers that have licensing agreements to use the Company's SuperFlash® embedded flash and Smartbits® one time programmable NVM technologies. All of the contract types listed in the table above are included in the Company's semiconductor product segment with the exception of licenses, which is included in the technology licensing segment.

Substantially all of the Company's net sales are recognized from contracts with customers.

Note 5. Net Income Per Common Share

The following table sets forth the computation of basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net income	$	36.2	$	311.1	$	233.4	$	470.7
Basic weighted average common shares outstanding	263.4		239.2		255.7		238.5
Dilutive effect of stock options and RSUs	3.7		3.4		3.4		3.5
Dilutive effect of 2015 Senior Convertible Debt	3.5		15.2		5.4		13.6
Dilutive effect of 2017 Senior Convertible Debt	2.8		0.3		1.5		0.1
Dilutive effect of 2020 Senior Convertible Debt	—		—		—		—
Dilutive effect of 2017 Junior Convertible Debt	2.0		0.2		1.0		0.1
Diluted weighted average common shares outstanding	275.4		258.3		267.0		255.8
Basic net income per common share	$	0.14	$	1.30	$	0.91	$	1.97
Diluted net income per common share	$	0.13	$	1.20	$	0.87	$	1.84

The Company computed basic net income per common share based on the weighted average number of common shares outstanding during the period. The Company computed diluted net income per common share based on the weighted average number of common shares outstanding plus potentially dilutive common shares outstanding during the period.

Potentially dilutive common shares from employee equity incentive plans are determined by applying the treasury stock method to the assumed exercise of outstanding stock options and the assumed vesting of outstanding RSUs. Weighted average common shares exclude the effect of option shares which are not dilutive.  There were no anti-dilutive option shares for each of the three and nine months ended December 31, 2020 and 2019.

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The Company's Convertible Debt has no impact on diluted net income per common share unless the average price of the Company's common stock exceeds the conversion price because the Company intends to settle the principal amount of the Convertible Debt in cash upon conversion.  Prior to conversion, the Company will include, in the diluted net income per common share calculation, the effect of the additional shares that may be issued when the Company's common stock price exceeds the conversion price using the treasury stock method.  The following is the weighted average conversion price per share used in calculating the dilutive effect (see Note 6 for details on the Convertible Debt):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
2015 Senior Convertible Debt	$	60.78	$	61.67	$	60.99	$	61.92
2017 Senior Convertible Debt	$	94.78	$	96.16	$	95.11	$	96.56
2020 Senior Convertible Debt	$	186.87	$	—	$	186.87	$	—
2017 Junior Convertible Debt	$	93.12	$	94.48	$	93.44	$	94.87

Note 6. Debt

Debt obligations included in the condensed consolidated balance sheets consisted of the following (in millions):

	Coupon Interest Rate	Effective Interest Rate	Fair Value of Liability Component at Issuance (1)
				December 31,		March 31,
				2020		2020
Senior Secured Indebtedness
Revolving Credit Facility				$	2,356.6	$	2,388.5
Term Loan Facility				—		1,723.5
Bridge Loan Facility				—		615.0
3.922% 2021 Notes	3.922%	4.5%		1,000.0		1,000.0
4.333% 2023 Notes	4.333%	4.7%		1,000.0		1,000.0
2.670% 2023 Notes	2.670%	2.8%		1,000.0		—
0.972% 2024 Notes	0.972%	1.1%		1,400.0		—
Senior Unsecured Indebtedness
4.250% 2025 Notes	4.250%	4.6%		1,200.0		—
Total Senior Indebtedness				7,956.6		6,727.0
Senior Subordinated Convertible Debt - Principal Outstanding
2015 Senior Convertible Debt	1.625%	5.9%	$188.5	222.4		1,110.0
2017 Senior Convertible Debt	1.625%	6.0%	$353.6	455.5		2,070.0
2020 Senior Convertible Debt	0.125%	5.1%	$555.5	665.5		—
Junior Subordinated Convertible Debt - Principal Outstanding
2017 Junior Convertible Debt	2.250%	7.4%	$144.5	278.6		686.3
Total Convertible Debt				1,622.0		3,866.3
Gross long-term debt including current maturities				9,578.6		10,593.3
Less: Debt discount (2)				(399.6)		(1,043.2)
Less: Debt issuance costs (3)				(38.0)		(67.9)
Net long-term debt including current maturities				9,141.0		9,482.2
Less: Current maturities (4)				(1,493.2)		(608.8)
Net long-term debt				$	7,647.8	$	8,873.4

(1) As each of the convertible debt instruments may be settled in cash upon conversion, for accounting purposes, they were bifurcated into a liability component and an equity component, which are both initially recorded at fair value.  The amount allocated to the equity component is the difference between the principal value of the instrument and the fair value of the liability component at issuance.  The resulting debt discount is being amortized to interest expense at the respective effective interest rate over the contractual term of the debt.

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(2) The unamortized discount consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Bridge Loan Facility	$	—	$	(3.1)
3.922% 2021 Notes	(0.8)		(2.1)
4.333% 2023 Notes	(2.7)		(3.5)
2.670% 2023 Notes	(2.5)		—
0.972% 2024 Notes	(4.1)		—
4.250% 2025 Notes	(13.5)		—
2015 Senior Convertible Debt	(33.3)		(192.9)
2017 Senior Convertible Debt	(100.9)		(504.2)
2020 Senior Convertible Debt	(108.0)		—
2017 Junior Convertible Debt	(133.8)		(337.4)
Total unamortized discount	$	(399.6)	$	(1,043.2)

(3) Debt issuance costs consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Revolving Credit Facility	$	(11.1)	$	(14.6)
Term Loan Facility	—		(14.6)
Bridge Loan Facility	—		(3.1)
3.922% 2021 Notes	(1.7)		(4.8)
4.333% 2023 Notes	(5.9)		(7.7)
2.670% 2023 Notes	(1.4)		—
0.972% 2024 Notes	(2.2)		—
4.250% 2025 Notes	(1.8)		—
2015 Senior Convertible Debt	(1.2)		(7.0)
2017 Senior Convertible Debt	(2.6)		(13.0)
2020 Senior Convertible Debt	(8.9)		—
2017 Junior Convertible Debt	(1.2)		(3.1)
Total debt issuance costs	$	(38.0)	$	(67.9)

(4) As of December 31, 2020, current maturities consist of the liability component of the 2017 Senior Convertible Debt and the 2017 Junior Convertible Debt, and the 3.922% 2021 Notes which are due June 1, 2021. As of March 31, 2020, current maturities included the Bridge Loan Facility.

Expected maturities relating to the Company’s debt obligations as of December 31, 2020 are as follows (in millions):

Fiscal year ending March 31,	Expected Maturities
2021	$	—
2022	1,000.0
2023	—
2024	5,756.6
2025	887.9
Thereafter	1,934.1
Total	$	9,578.6

Ranking of Convertible Debt - The Convertible Debt are unsecured obligations which are subordinated in right of payment to the amounts outstanding under the Company's Senior Indebtedness. The Junior Subordinated Convertible Debt is expressly subordinated in right of payment to any existing and future senior debt of the Company (including the Senior Indebtedness and the Senior Subordinated Convertible Debt) and is structurally subordinated in right of payment to the liabilities of the Company's subsidiaries.  The Senior Subordinated Convertible Debt is subordinated to the Senior Indebtedness; ranks senior to the Company's indebtedness that is expressly subordinated in right of payment to it, including the Junior Subordinated Convertible Debt; ranks equal in right of payment to any of the Company's unsubordinated indebtedness that does not provide

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that it is senior to the Senior Subordinated Convertible Debt; ranks junior in right of payment to any of the Company's secured and unsecured unsubordinated indebtedness to the extent of the value of the assets securing such indebtedness; and is structurally subordinated to all indebtedness and other liabilities of the Company's subsidiaries.

Summary of Conversion Features - Each series of Convertible Debt is convertible, subject to certain conditions, into cash, shares of the Company's common stock or a combination thereof, at the Company's election, at specified conversion rates (see table below), adjusted for certain events including the declaration of cash dividends. Except during the three-month period immediately preceding the maturity date of the applicable series of Convertible Debt, each series of Convertible Debt is convertible only upon the occurrence of (i) such time as the closing price of the Company's common stock exceeds the conversion price (see table below) by 130% for 20 days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter or (ii) during the 5 business day period after any 10 consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day or (iii) upon the occurrence of certain corporate events specified in the indenture of such series of Convertible Debt. In addition, for each series, if at the time of conversion the applicable price of the Company's common stock exceeds the applicable conversion price at such time, the applicable conversion rate will be increased by up to an additional maximum incremental shares rate, as determined pursuant to a formula specified in the indenture for the applicable series of Convertible Debt, and as adjusted for cash dividends paid since the issuance of such series of Convertible Debt. However, in no event will the applicable conversion rate exceed the applicable maximum conversion rate specified in the indenture for the applicable series of Convertible Debt (see table below).

The following table sets forth the applicable conversion rates adjusted for dividends declared since issuance of such series of Convertible Debt and the applicable incremental share factors and maximum conversion rates as adjusted for dividends paid since the applicable issuance date:

	Dividend adjusted rates as of December 31, 2020
	Conversion Rate	Approximate Conversion Price		Incremental Share Factor	Maximum Conversion Rate
2015 Senior Convertible Debt (1)	16.4786	$	60.68	8.2393	23.0700
2017 Senior Convertible Debt (1)	10.5670	$	94.63	5.2835	15.0581
2020 Senior Convertible Debt (1)	5.3514	$	186.87	—	7.4919
2017 Junior Convertible Debt (1)	10.7558	$	92.97	5.3779	15.0581

(1) As of December 31, 2020, the 2020 Senior Convertible Debt was not convertible. As of December 31, 2020, the holders of the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt have the right to convert their notes between January 1, 2021 and March 31, 2021 because the Company's common stock price has exceeded the applicable conversion price for such series by 130% for the specified period of time during the quarter ended December 31, 2020. As of December 31, 2020, the adjusted conversion rate for the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt would be increased to 21.0976 shares of common stock, 12.2303 shares of common stock, and 12.5134 shares of common stock, respectively, per $1,000 principal amount of notes based on the closing common stock price of $138.11 to include an additional maximum incremental share rate per the terms of the applicable indenture. As of December 31, 2020, the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt had a conversion value in excess of par of $425.6 million, $313.9 million, and $202.9 million, respectively.

With the exception of the 2020 Senior Convertible Debt, which may be redeemed by the Company on or after November 20, 2022, the Company may not redeem any series of Convertible Debt prior to the relevant maturity date and no sinking fund is provided for any series of Convertible Debt. Under the terms of the applicable indenture, the Company may repurchase any series of Convertible Debt in the open market through privately negotiated exchange offers. Upon the occurrence of a fundamental change, as defined in the applicable indenture of such series of Convertible Debt, holders of such series may require the Company to purchase all or a portion of their Convertible Debt for cash at a price equal to 100% of the principal amount plus any accrued and unpaid interest.

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Interest expense consists of the following (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Debt issuance amortization	$	3.7	$	3.3	$	11.5	$	9.9
Debt discount amortization	1.6		0.7		4.7		2.1
Interest expense	59.2		64.1		171.3		217.7
Total interest expense on Senior Indebtedness	64.5		68.1		187.5		229.7
Debt issuance amortization	0.5		1.0		1.7		2.9
Debt discount amortization	12.8		30.0		52.8		88.8
Coupon interest expense	7.8		19.3		33.9		57.9
Total interest expense on Convertible Debt	21.1		50.3		88.4		149.6
Other interest expense	0.9		1.3		3.0		2.6
Total interest expense	$	86.5	$	119.7	$	278.9	$	381.9

The remaining period over which the unamortized debt discount will be recognized as non-cash interest expense is 4.1 years, 6.1 years, 3.9 years, and 16.1 years for the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, 2020 Senior Convertible Debt, and 2017 Junior Convertible Debt, respectively.  

In December 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, approximately (i) $90.0 million principal amount of its 2015 Senior Convertible Debt for $48.5 million in cash and 1.6 million shares of the Company's common stock valued at $221.0 million for total consideration of $269.6 million, of which $79.4 million was allocated to the fair value of the liability component and $184.5 million was allocated to the reacquisition of the equity component, (ii) $588.8 million principal amount of its 2017 Senior Convertible Debt for $155.4 million in cash, 3.0 million shares of the Company's common stock valued at $408.7 million, and $601.5 million principal amount of 2020 Senior Convertible Debt, for a total consideration of $1.20 billion, of which $486.7 million was allocated to the fair value of the liability component and $655.3 million was allocated to the reacquisition of the equity component, and (iii) $407.7 million principal amount of its 2017 Junior Convertible Debt for $225.0 million in cash, 3.8 million shares of the Company's common stock valued at $530.4 million, and $64.0 million principal amount of 2020 Senior Convertible Debt, for total consideration of $819.4 million, of which $246.3 million was allocated to the fair value of the liability component and $547.1 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $129.2 million. The Company used borrowings under its Revolving Credit Facility to finance a portion of its 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt settlement transactions. In connection with the issuance of the 2020 Senior Convertible Debt, the Company incurred issuance costs of $10.8 million, of which $9.0 million was recorded as debt issuance costs and will be amortized using the effective interest method over the term of the debt. The remainder of $1.8 million in fees was recorded to equity. The debt discount on the 2020 Senior Convertible Debt was the difference between the par value and the fair value of the debt resulting in a debt discount of $110.0 million which will be amortized to interest expense using the effective interest method over the term of the debt. Interest on the 2020 Senior Convertible Debt is payable semi-annually in arrears on May 15 and November 15 of each year. The Company also issued $1.40 billion aggregate principal amount of 0.972% 2024 Notes and used the proceeds in addition to $213.0 million in borrowings under its Revolving Credit Facility, and cash on hand to repay all amounts outstanding under its Term Loan Facility resulting in a net loss on settlement of debt of $12.9 million consisting of unamortized financing fees.

In connection with the issuance of the 2020 Senior Convertible Debt, the Company entered into capped call option transactions with several financial institutions at a cost of $35.8 million. The capped call options cover, subject to anti-dilution adjustments, the number of shares of the Company’s common stock initially underlying the 2020 Senior Convertible Debt. Upon conversion of the 2020 Senior Convertible Debt, the Company may exercise the capped call options subject to a cap strike price of $233.58 per share which would reduce the potential dilution to the Company’s common stock or offset any cash payments the Company is required to make in excess of the principal amount of converted notes. Upon conversion of the 2020 Senior Convertible Debt, there will be no economic dilution from the notes until the average market price of the Company’s common stock exceeds the cap price of $233.58 per share as the exercise of the capped call options will offset any dilution from the 2020 Senior Convertible Debt from the conversion price up to the cap price. As these transactions meet certain accounting criteria, the capped call options are recorded as a reduction of stockholders' equity and are not accounted for as derivatives.

In August 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, (i) $414.3 million aggregate principal amount of its 2015 Senior Convertible Debt for $414.3 million in cash and 5.2 million shares

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of the Company's common stock valued at $547.6 million for total consideration of $961.8 million, of which $351.7 million was allocated to the fair value of the liability component and $592.3 million was allocated to the reacquisition of the equity component, and (ii) $381.8 million aggregate principal amount of its 2017 Senior Convertible Debt for $381.8 million in cash and 2.1 million shares of the Company's common stock valued at $221.1 million for total consideration of $602.9 million, of which $299.0 million was allocated to the fair value of the liability component and $292.2 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $45.1 million. The Company used borrowings under its Revolving Credit Facility to finance the cash portion of its 2015 Senior Convertible Debt and 2017 Senior Convertible Debt settlement transactions.

In June 2020, the Company used a portion of the proceeds from the issuance of the 2.670% 2023 Notes and the 4.250% 2025 Notes (as further defined below) to (i) repay $615.0 million in borrowings under the Bridge Loan Facility resulting in a loss on settlement of debt of $5.3 million consisting of unamortized financing fees, (ii) settle $383.3 million aggregate principal amount of the Company's 2015 Senior Convertible Debt and $643.9 million aggregate principal amount of the Company's 2017 Senior Convertible Debt, and (iii) repay a portion of the amount outstanding under the Company's existing Revolving Credit Facility as well as for general corporate purposes (the "June 2020 Settlements"). The Company settled, in separate privately negotiated transactions that are accounted for as induced conversions, (i) $383.3 million aggregate principal amount of its 2015 Senior Convertible Debt for $383.3 million in cash and 4.1 million shares of the Company's common stock valued at $405.1 million for total consideration of $788.4 million, of which $314.4 million was allocated to the fair value of the liability component and $464.4 million was allocated to the reacquisition of the equity component, and (ii) $643.9 million aggregate principal amount of its 2017 Senior Convertible Debt for $643.9 million in cash and 2.5 million shares of the Company's common stock valued at $246.4 million for total consideration of $890.3 million, of which $481.0 million was allocated to the fair value of the liability component and $390.9 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $21.5 million.

In March 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, $615.0 million aggregate principal amount of its 2015 Senior Convertible Debt for $615.0 million in cash and 5.2 million shares of the Company's common stock valued at $351.8 million for total consideration of $966.8 million. In addition, the Company also entered into a Bridge Loan Facility, which provides for a term loan facility for an aggregate principal amount of $615.0 million to finance the cash portion of its 2015 Senior Convertible Debt settlement transaction.

Senior Notes

0.972% 2024 Notes

In December 2020, the Company issued $1.40 billion aggregate principal amount of 0.972% 2024 Notes in a private placement. In connection with the issuance of the notes, the Company incurred issuance costs of $2.2 million and recorded a debt discount of $4.2 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The Company used proceeds from the issuance of 0.972% 2024 Notes to pay the amounts outstanding under its Term Loan Facility. The 0.972% 2024 Notes mature on February 15, 2024 and interest accrues at a rate of 0.972% per annum, payable semi-annually in arrears on February 15 and August 15 of each year.

The Company may, at its option, redeem some or all of the 0.972% 2024 Notes prior to February 15, 2024 at a price equal to the greater of (a) 100% of the principal amount of the 0.972% 2024 Notes redeemed and (b) the sum of the present value of all remaining scheduled payments of principal and interest (discounted in accordance with the 0.972% 2024 Notes indenture) that would have been due on the redeemed 0.972% 2024 Notes, in each case, plus accrued and unpaid interest to, but excluding, the repurchase date. If the Company experiences a specified change of control triggering event, the Company must offer to repurchase the 0.972% 2024 Notes at a price equal to 101% of the principal amount of the 0.972% 2024 Notes repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The 0.972% 2024 Notes indenture contains customary affirmative and negative covenants, including covenants that limit or restrict the Company and its subsidiaries' ability to, among other things, create or incur certain liens, and enter into sale and leaseback transactions, sell or otherwise dispose of any assets constituting collateral securing the 0.972% 2024 Notes, and consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its assets, to another person. These covenants are subject to a number of limitations and exceptions set forth in the indenture.

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The 0.972% 2024 Notes are guaranteed by certain of the Company's subsidiaries that have also guaranteed the obligations under the Credit Agreement and under the Company’s existing Senior Indebtedness. In the future, each subsidiary of the Company that is a guarantor or other obligor of the Credit Agreement will guarantee the 0.972% 2024 Notes. The 0.972% 2024 Notes and the 0.972% 2024 Note guarantees are secured, on a pari passu first lien basis with the Credit Agreement and the Company's existing Senior Secured Notes, by substantially all of the tangible and intangible assets (other than certain excluded assets) of the Company and the guarantors that secure obligations under the Credit Agreement and the Company's existing Senior Secured Notes, in each case subject to certain thresholds, exceptions and permitted liens, as set forth in a security agreement, dated December 17, 2020, by and among the Company, the subsidiary guarantors party thereto and the collateral agent.

2.670% 2023 Notes and 4.250% 2025 Notes

In May 2020, the Company issued $1.00 billion aggregate principal amount of 2.670% 2023 Notes and $1.20 billion aggregate principal amount of 4.250% 2025 Notes in a private placement. In connection with the issuance of these notes, the Company incurred issuance costs of $3.8 million and recorded a debt discount of $18.0 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The Company used proceeds from the issuance of the 2.670% 2023 Notes and the 4.250% 2025 Notes to fund the June 2020 Settlements. The 2.670% 2023 Notes mature on September 1, 2023 and interest accrues at a rate of 2.670% per annum, payable semi-annually in arrears on March 1 and September 1 of each year. The 4.250% 2025 Notes mature on September 1, 2025 and interest accrues at a rate of 4.250% per annum, payable semi-annually in arrears on March 1 and September 1 of each year.

The Company may, at its option, redeem some or all of the 2.670% 2023 Notes prior to September 1, 2023 at a price equal to the greater of (a) 100% of the principal amount of the 2.670% 2023 Notes redeemed and (b) the sum of the present value of all remaining scheduled payments of principal and interest (discounted in accordance with the 2.670% 2023 Notes indenture) that would have been due on the redeemed 2.670% 2023 Notes, in each case, plus accrued and unpaid interest to, but excluding, the redemption date. Prior to September 1, 2022, the Company may, at its option, redeem up to 40% of the original aggregate principal amount of the 4.250% 2025 Notes with the net cash proceeds of one or more equity offerings (as such terms are defined in the 4.250% 2025 Notes indenture), at a price equal to 104.250% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date, provided that (i) at least 60% of the original aggregate principal amount of the 4.250% 2025 Notes remains outstanding after each such redemption and (ii) such redemption occurs within 60 days after the closing of such equity offering. In addition, prior to September 1, 2022, the Company may, at its option, redeem the 4.250% 2025 Notes in whole or in part, at a redemption price equal to 100% of the aggregate principal amount of 4.250% 2025 Notes redeemed, plus, in each case, a premium equal to the greater of (i) 1.0% of the principal amount of such 4.250% 2025 Notes and (ii) the excess, if any, of (a) the present value as of such date of redemption of (1) the redemption price of such 4.250% 2025 Notes on September 1, 2022, plus (2) all required interest payments due on such 4.250% 2025 Notes through September 1, 2022 (excluding accrued but unpaid interest to the date of redemption) computed using a discount rate equal to the treasury rate (as defined in the 4.250% 2025 Notes indenture) as of such date of redemption plus 50 basis points, over (b) the then outstanding principal amount of such 4.250% 2025 Notes. On or after September 1, 2022, the Company may, at its option, redeem some or all of the 4.250% 2025 Notes, at a redemption price equal to (i) if during the twelve-month period beginning on September 1, 2022, 102.125% of the aggregate principal amount of 4.250% 2025 Notes redeemed, (ii) if during the twelve-month period beginning on September 1, 2023, 101.063% of the aggregate principal amount of 4.250% 2025 Notes redeemed, and (iii) if during the twelve-month period beginning on September 1, 2024 or thereafter, 100% of the aggregate principal amount of 4.250% 2025 Notes redeemed, in each case, plus accrued and unpaid interest on such 4.250% 2025 Notes, if any, to, but excluding, the repurchase date.

If the Company experiences a specified change of control triggering event, the Company must offer to repurchase the 2.670% 2023 Notes and 4.250% 2025 Notes at a price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The 2.670% 2023 Notes indenture and the 4.250% 2025 Notes indenture contain customary affirmative and negative covenants, including covenants that limit or restrict the Company and its subsidiaries' ability to, among other things, create or incur certain liens, and enter into sale and leaseback transactions, and consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its assets, to another person. The 2.670% 2023 Notes indenture contains covenants that restrict the ability of the Company and its subsidiaries to sell or otherwise dispose of any assets constituting collateral securing the 2.670% 2023 Notes. These covenants are subject to a number of limitations and exceptions set forth in the indentures.

The 2.670% 2023 Notes and 4.250% 2025 Notes are guaranteed by certain of the Company's subsidiaries that have also guaranteed the obligations under the Company's Senior Credit Facilities, and under the Company's existing Senior Secured

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Notes. In the future, each subsidiary of the Company that is a guarantor or other obligor of the Company's existing Senior Credit Facilities or certain other indebtedness of the Company will guarantee the 2.670% 2023 Notes and 4.250% 2025 Notes.

The 2.670% 2023 Notes and the 2.670% 2023 Notes guarantees are secured, on a pari passu first lien basis with the Company's existing Senior Credit Facilities, by substantially all of the tangible and intangible assets (other than certain excluded assets) of the Company and the guarantors that secure obligations under the Company's existing Senior Credit Facilities, in each case subject to certain thresholds, exceptions and permitted liens, as set forth in a pledge and the security agreement, dated May 29, 2020, by and among the Company, the subsidiary guarantors party thereto and the collateral agent.

4.333% 2023 Notes and 3.922% 2021 Notes

In May 2018, the Company issued $1.00 billion aggregate principal amount of 3.922% 2021 Notes and $1.00 billion aggregate principal amount of 4.333% 2023 Notes (together, the "Senior Secured Notes") in a private placement. In connection with the issuance of these notes, the Company incurred issuance costs of $24.4 million and recorded a debt discount of $10.5 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The 3.922% 2021 Notes mature on June 1, 2021 and the 4.333% 2023 Notes mature on June 1, 2023. Interest on the 3.922% 2021 Notes accrues at a rate of 3.922% per annum, payable semi-annually in arrears on June 1 and December 1 of each year. Interest on the 4.333% 2023 Notes accrues at a rate of 4.333% per annum, payable semi-annually in arrears on June 1 and December 1 of each year.

Senior Credit Facilities

In March 2020 and September 2019, the Company amended the Company's Credit Agreement to, among other things, amend certain negative covenants, including covenants that restrict the Company and its subsidiaries’ ability to, among other things, incur subsidiary indebtedness, grant liens and enter into certain restrictive agreements. The amendments provide the Company the ability to finance a Convertible Notes repurchase not to exceed $1.00 billion with secured debt, and the ability to factor receivables and certain related assets as further explained below. In addition, the amendments reduce the margin added to the interest rate on revolving loans under the Credit Agreement to 0.0% to 0.75% for base rate loans and 1.0% to 1.75% for the LIBOR rate loans, in each case determined based on the Company's senior leverage ratio. The amendments reduced the commitments for the Revolving Credit Facility thereunder to $3.57 billion from $3.60 billion.

Note 7. Fair Value of Financial Instruments

Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.  As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.  As a basis for considering such assumptions, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1-Observable inputs such as quoted prices in active markets;

Level 2-Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3-Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The carrying amount of cash equivalents approximates fair value because their maturity is less than three months. Management believes the carrying amount of the equity and cost-method investments materially approximated fair value at December 31, 2020 based upon unobservable inputs. The fair values of these investments have been determined as Level 3 fair value measurements. The carrying amount of accounts receivable, accounts payable and accrued liabilities approximates fair value due to the short-term maturity of the amounts and are considered Level 2 in the fair value hierarchy.  

The fair values of the Company's Revolving Credit Facility, Term Loan Facility and Bridge Loan Facility are estimated using discounted cash flow analyses, based on the Company's current incremental borrowing rates for similar types of borrowing arrangements. Based on the borrowing rates currently available to the Company for bank loans with similar terms and average maturities, the fair value of the Company's Revolving Credit Facility at December 31, 2020 approximated the carrying value excluding debt discounts and debt issuance costs and are considered Level 2 in the fair value hierarchy. The Company measures the fair value of its Convertible Debt and Senior Notes for disclosure purposes. These fair values are based on observable market prices for this debt, which is traded in less active markets and are therefore classified as a Level 2 fair value measurement.

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The following table shows the carrying amounts and fair values of the Company's debt obligations as of December 31, 2020 and March 31, 2020 (in millions):

	December 31, 2020				March 31, 2020
	Carrying Amount (1)		Fair Value		Carrying Amount (1)		Fair Value
Revolving Credit Facility	$	2,345.5	$	2,356.6	$	2,373.9	$	2,388.5
Term Loan Facility	—		—		1,708.9		1,723.5
Bridge Loan Facility	—		—		608.8		615.0
3.922% 2021 Notes	997.5		1,014.0		993.1		985.0
4.333% 2023 Notes	991.4		1,083.0		988.8		990.0
2.670% 2023 Notes	996.1		1,047.2		—		—
0.972% 2024 Notes	1,393.7		1,403.6		—		—
4.250% 2025 Notes	1,184.7		1,257.0		—		—
2015 Senior Convertible Debt	187.9		665.8		910.1		1,601.8
2017 Senior Convertible Debt	352.0		914.3		1,552.8		2,130.3
2020 Senior Convertible Debt	548.6		736.7		—		—
2017 Junior Convertible Debt	143.6		561.9		345.8		656.2
Total	$	9,141.0	$	11,040.1	$	9,482.2	$	11,090.3

(1) The carrying amounts presented are net of debt discounts and debt issuance costs (see Note 6 for further information).

Note 8. Intangible Assets and Goodwill

Intangible assets consist of the following (in millions):

	December 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,362.4	$	(2,558.5)	$	4,803.9
Customer-related	835.2		(679.7)		155.5
In-process research and development	7.7		—		7.7
Distribution rights and other	126.1		(67.4)		58.7
Total	$	8,331.4	$	(3,305.6)	$	5,025.8

	March 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,331.9	$	(1,924.6)	$	5,407.3
Customer-related	903.6		(674.7)		228.9
In-process research and development	8.8		—		8.8
Distribution rights and other	126.0		(68.7)		57.3
Total	$	8,370.3	$	(2,668.0)	$	5,702.3

The following is an expected amortization schedule for the intangible assets for the remainder of fiscal 2021 through fiscal 2025, absent any future acquisitions or impairment charges (in millions):

Fiscal Year Ending March 31,	Projected Amortization Expense
2021	$	247.9
2022	$	911.8
2023	$	707.0
2024	$	626.2
2025	$	508.9

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The Company amortizes intangible assets over their expected useful lives, which range between 1 and 15 years. Amortization expense attributed to intangible assets are assigned to cost of sales and operating expenses as follows (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Amortization expense charged to cost of sales	$	2.4	$	2.5	$	6.9	$	7.1
Amortization expense charged to operating expense	244.2		256.1		738.2		770.5
Total amortization expense	$	246.6	$	258.6	$	745.1	$	777.6

There were no impairment charges in the three and nine months ended December 31, 2020 and in the three months ended December 31, 2019. The Company recognized impairment charges of $0.5 million in the nine months ended December 31, 2019.

Goodwill activity for the nine months ended December 31, 2020 by segment was as follows (in millions):

	Semiconductor Products Reporting Unit		Technology Licensing Reporting Unit
Balance at March 31, 2020	$	6,645.6	$	19.2
Additions	5.8		—
Balance at December 31, 2020	$	6,651.4	$	19.2

At March 31, 2020, the Company applied a qualitative goodwill impairment test to its two reporting units, concluding it was not more likely than not that goodwill was impaired. Through December 31, 2020, the Company has never recorded an impairment charge against its goodwill balance.

Note 9. Other Financial Statement Details

Accounts Receivable

Accounts receivable consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Trade accounts receivable	$	887.9	$	924.1
Other	11.1		14.8
Total accounts receivable, gross	899.0		938.9
Less allowance for expected credit losses	5.2		4.9
Total accounts receivable, net	$	893.8	$	934.0

Inventories

The components of inventories consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Raw materials	$	112.8	$	92.3
Work in process	413.6		441.7
Finished goods	139.7		151.7
Total inventories	$	666.1	$	685.7

Inventories are valued at the lower of cost and net realizable value using the first-in, first-out method. Inventory impairment charges establish a new cost basis for inventory and charges are not subsequently reversed to income even if circumstances later suggest that increased carrying amounts are recoverable.

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Property, Plant and Equipment

Property, plant and equipment consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Land	$	79.9	$	83.4
Building and building improvements	643.7		659.5
Machinery and equipment	2,190.6		2,123.1
Projects in process	124.2		100.1
Total property, plant and equipment, gross	3,038.4		2,966.1
Less accumulated depreciation and amortization	2,211.0		2,090.0
Total property, plant and equipment, net	$	827.4	$	876.1

Depreciation expense attributed to property, plant and equipment was $40.3 million and $120.4 million for the three and nine months ended December 31, 2020, respectively, compared to $41.4 million and $127.1 million for the three and nine months ended December 31, 2019, respectively.

Accrued Liabilities

Accrued liabilities consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Accrued compensation and benefits	$	166.6	$	137.5
Income taxes payable	12.8		38.0
Sales related reserves	332.2		353.0
Current portion of lease liabilities	40.2		44.5
Accrued expenses and other liabilities	217.4		208.8
Total accrued liabilities	$	769.2	$	781.8

Note 10. Commitments and Contingencies

Indemnification Contingencies

The Company's technology license agreements generally include an indemnification clause that indemnifies the licensee against liability and damages (including legal defense costs) arising from any claims of patent, copyright, trademark or trade secret infringement by the Company's proprietary technology.  The terms of these indemnification provisions approximate the terms of the outgoing technology license agreements, which are typically perpetual unless terminated by either party for breach. The possible amount of future payments the Company could be required to make based on agreements that specify indemnification limits, if such indemnifications were required on all of these agreements, is approximately $168.1 million. There are some licensing agreements in place that do not specify indemnification limits. As of December 31, 2020, the Company had not recorded any liabilities related to these indemnification obligations and the Company believes that any amounts that it may be required to pay under these agreements in the future will not have a material adverse effect on its financial position, cash flows or results of operations.

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Warranty Costs and Product Liabilities

The Company accrues for known product-related claims if a loss is probable and can be reasonably estimated. During the periods presented, there have been no material accruals or payments regarding product warranty or product liability. Historically, the Company has experienced a low rate of payments on product claims. Although the Company cannot predict the likelihood or amount of any future claims, the Company does not believe these claims will have a material adverse effect on its financial condition, results of operations or liquidity.

Legal Matters

In the ordinary course of the Company's business, it is exposed to various liabilities as a result of contracts, product liability, customer claims, governmental investigations and other matters. Additionally, the Company is involved in a limited number of legal actions, both as plaintiff and defendant. Consequently, the Company could incur uninsured liability in any of those actions.  The Company also periodically receives notifications from various third parties alleging infringement of patents or other intellectual property rights, or from customers requesting reimbursement for various costs. With respect to pending legal actions to which the Company is a party and other claims, although the outcomes are generally not determinable, the Company believes that the ultimate resolution of these matters will not have a material adverse effect on its financial position, cash flows or results of operations. Litigation, governmental investigations and disputes relating to the semiconductor industry are not uncommon, and the Company is, from time to time, subject to such litigation, governmental investigations and disputes.  As a result, no assurances can be given with respect to the extent or outcome of any such litigation, governmental investigations or disputes in the future.

In connection with its acquisition of Microsemi, which closed on May 29, 2018, the Company became involved with the following legal matters:

Federal Shareholder Class Action Litigation.  Beginning on September 14, 2018, the Company and certain of its officers were named in two putative shareholder class action lawsuits filed in the United States District Court for the District of Arizona, captioned Jackson v. Microchip Technology Inc., et al., Case No. 2:18-cv-02914-JJT and Maknissian v. Microchip Technology Inc., et al., Case No. 2:18-cv-02924-JJT. On November 13, 2018, the Maknissian complaint was voluntarily dismissed.  The Jackson complaint is allegedly brought on behalf of a putative class of purchasers of Microchip common stock between March 2, 2018 and August 9, 2018.  The complaint asserts claims for alleged violations of the federal securities laws and generally alleges that the defendants issued materially false and misleading statements and failed to disclose material adverse facts about the Company’s business, operations, and prospects during the putative class period.  The complaint seeks, among other things, compensatory damages and attorneys’ fees and costs on behalf of the putative class.  On December 11, 2018, the Court issued an order appointing the lead plaintiff.  An amended complaint was filed on February 22, 2019. Defendants filed a motion to dismiss the amended complaint on April 1, 2019, which motion was granted in part and denied in part on March 11, 2020. The class certification was filed by the plaintiff on September 11, 2020, and defendants filed their response and statement of non-opposition on October 16, 2020. Discovery is ongoing.

Federal Derivative Litigation.  On December 17, 2018, a shareholder derivative lawsuit was filed against certain of the Company’s officers and directors in the United States District Court for the District of Arizona, captioned Kistenmacher v. Sanghi, et al., Case No. 18-cv-04720.  The Company was named as a nominal defendant.  The complaint generally alleged that defendants breached their fiduciary duties by, among other things, making or causing the Company to make false and misleading statements and omissions regarding the Microsemi acquisition, the Company’s business, operations, and prospects, and a purported failure to maintain internal controls.  The complaint further alleged that certain defendants engaged in insider trading.  The complaint asserted causes of action for alleged violations of Section 14(a) of the Securities Exchange Act, breach of fiduciary duties, and unjust enrichment and sought unspecified monetary damages, corporate governance reforms, restitution, and attorneys’ fees and costs. Defendants filed motions to dismiss on July 23, 2019. On September 13, 2019, the court granted the parties' stipulation of voluntary dismissal dismissing the case without prejudice.

State Derivative Litigation.  On January 22, 2019, a shareholder derivative lawsuit was filed against certain of the Company’s officers and directors in the Superior Court of Arizona for Maricopa County, captioned Reid v. Sanghi, et al., Case No. CV2019-002389.  The Company is named as a nominal defendant.  The complaint generally alleges that defendants breached their fiduciary duties by, among other things, purportedly failing to conduct adequate due diligence regarding Microsemi prior to its acquisition, misrepresenting the Company’s business prospects and health, and engaging in improper practices, and further alleges that certain defendants engaged in insider trading. The complaint asserts causes of action for breach of fiduciary duty, waste, and unjust enrichment and seeks unspecified monetary damages, corporate governance reforms, equitable and/or injunctive relief, restitution, and attorneys’ fees and costs. This case was stayed on May 23, 2019 to allow the Federal Derivative Litigation to address certain overlapping issues. Following the dismissal of the Federal Derivative Litigation, on October 1, 2019, the court granted the parties' joint request for a temporary stay. On January 30, 2020, the court

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lifted the temporary stay. An amended complaint was filed on February 28, 2020. Defendants filed their motions to dismiss the amended complaint on April 24, 2020. The parties stipulated to plaintiff's request to file a second amended complaint, and the pending motions to dismiss were withdrawn as moot. A second amended complaint was filed on July 27, 2020. On September 17, 2020, the Company filed a motion to stay proceedings, and the Company and the individual defendants filed motions to dismiss. On November 2, 2020, the court entered the order to stay this matter until January 20, 2021. On January 29, 2021, the Court entered an order continuing the stay until March 26, 2021.

Peterson, et al. v. Sanghi, et al.  On October 9, 2018, four former officers of Microsemi Corporation filed a lawsuit in the Superior Court of California in Orange County against the Company, Steve Sanghi, Eric Bjornholt, Ganesh Moorthy and Mitch Little asserting claims for slander per se, libel per se, trade libel, and violations of California Business and Professions Code Section 17200 ("UCL"). Among other things, the plaintiffs in this matter allege that statements the Microchip executives made about excess shipments of products by Microsemi into the distribution channel were defamatory and that Microchip executives, including Mr. Sanghi, made false statements about Microsemi's shipments of products into the distribution channel, about certain Microsemi business practices and about the relative strength of the financial results of Microchip and Microsemi for the June 2018 quarter. On November 8, 2018, defendants removed the action to the United States District Court for the Central District of California, Case No. 18-cv-02000-JLS. Defendants moved to dismiss, and, following the Court's ruling, Plaintiffs filed an amended complaint that dropped the trade libel and UCL claims. The plaintiffs were seeking compensatory damages in excess of $100 million, punitive damages in excess of $300 million, as well as injunctive relief, and attorneys' fees and costs. In March 2020, the parties settled this matter, and the matter was later dismissed with prejudice.

Governmental Investigations. The Department of Justice and the Securities and Exchange Commission are investigating matters relating to the Company's acquisition of Microsemi. The Company believes that the investigations relate to distribution channel issues and business practices at Microsemi and the allegations made by the plaintiffs in the Peterson v. Sanghi lawsuit described above.

As a result of its acquisition of Atmel, which closed April 4, 2016, the Company became involved with the following legal matters:

Continental Claim ICC Arbitration. On December 29, 2016, Continental Automotive GmbH ("Continental") filed a Request for Arbitration with the ICC, naming as respondents the Company's subsidiaries Atmel Corporation, Atmel SARL, Atmel Global Sales Ltd., and Atmel Automotive GmbH (collectively, "Atmel").  The Request alleges that a quality issue affecting Continental airbag control units in certain recalled vehicles stems from allegedly defective Atmel application specific integrated circuits ("ASICs").  Continental seeks to recover from Atmel all current and future costs and damages incurred as a result of the vehicle manufacturers’ airbag control unit-related recalls, with current costs and damages alleged to be about $115 million to date. The Company's Atmel subsidiaries intend to defend this action vigorously.

Southern District of New York Action by LFoundry Rousset ("LFR") and LFR Employees. On March 4, 2014, LFR and Jean-Yves Guerrini, individually and on behalf of a putative class of LFR employees, filed an action in the United States District Court for the Southern District of New York (the "District Court") against the Company's Atmel subsidiary, French subsidiary, Atmel Rousset S.A.S. ("Atmel Rousset"), and LFoundry GmbH ("LF"), LFR's German parent. The case purports to relate to Atmel Rousset's June 2010 sale of its wafer manufacturing facility in Rousset, France to LF, and LFR's subsequent insolvency, and later liquidation, more than three years later. The District Court dismissed the case on August 21, 2015, and the United States Court of Appeals for the Second Circuit affirmed the dismissal on June 27, 2016. On July 25, 2016, the plaintiffs filed a notice of appeal from the District Court's June 27, 2016 denial of their motion for relief from the dismissal judgment. On May 19, 2017, the United States Court of Appeals for the Second Circuit affirmed the June 27, 2016 order dismissing the case.

Individual Labor Actions by former LFR Employees. In June 2010, Atmel Rousset sold its wafer manufacturing business in Rousset, France to LFoundry GmbH ("LF"), the German parent of LFoundry Rousset ("LFR"). LFR then leased the Atmel Rousset facility to conduct the manufacture of wafers. More than three years later, LFR became insolvent and later liquidated. In the wake of LFR's insolvency and liquidation, over 500 former employees of LFR filed individual labor actions against Atmel Rousset in a French labor court, and in 2019 a French labor court dismissed all of the employees’ claims against Atmel Rousset. Plaintiffs have filed appeals requesting reconsideration of the earlier dismissals. Furthermore, these same claims have been filed by this same group of employees in a regional court in France against Microchip Technology Incorporated and Atmel Corporation. The Company, and the other defendant entities, believe that each of these actions is entirely devoid of merit, and, further, that any assertion by any of the Claimants of a co-employment relationship with any of these entities is based substantially on the same specious arguments that the Paris Commercial Court summarily rejected in 2014 in related proceedings. The defendant entities therefore intend to defend vigorously against each of these claims. Additionally, complaints have been filed in a regional court in France on behalf of the same group of employees against Microchip

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Technology Rousset, Atmel Switzerland Sarl, Atmel Corporation and Microchip Technology Incorporated alleging that the sale of the Atmel Rousset production unit to LF was fraudulent and should be voided. These claims are specious and the defendant entities therefore intend to defend vigorously against these claims.

The Company accrues for claims and contingencies when losses become probable and reasonably estimable. As of the end of each applicable reporting period, the Company reviews each of its matters and, where it is probable that a liability has been or will be incurred, the Company accrues for all probable and reasonably estimable losses. Where the Company can reasonably estimate a range of losses it may incur regarding such a matter, the Company records an accrual for the amount within the range that constitutes its best estimate. If the Company can reasonably estimate a range but no amount within the range appears to be a better estimate than any other, the Company uses the amount that is the low end of such range. As of December 31, 2020, the Company's estimate of the aggregate potential liability that is possible but not probable is approximately $100 million in excess of amounts accrued.

Note 11. Income Taxes

The Company accounts for incomes taxes in accordance with ASC 740. The provision or benefit for income taxes is attributable to U.S. federal, state, and foreign income taxes. The Company’s effective tax rate used for interim periods is based on an estimated annual effective tax rate including the tax effect of items required to be recorded discretely in the interim periods in which those items occur. A comparison of the Company’s effective tax rates for the nine months ended December 31, 2020 and December 31, 2019 were not meaningful due to the amount of pre-tax income, and income tax benefits recorded during the period.

The Company's effective tax rate is different than the statutory rates in the U.S. due to foreign income taxed at different rates than the U.S., changes in uncertain tax benefit positions, changes to valuation allowances, generation of tax credits, and the impact of GILTI in the United States. In addition, the Company has numerous tax holidays it receives related to its Thailand manufacturing operations based on its investment in property, plant and equipment in Thailand. The Company's tax holiday periods in Thailand expire at various times in the future, however, the Company actively seeks to obtain new tax holidays. The material components of foreign income taxed at a rate lower than the U.S. are earnings accrued in Thailand, Malta, and Ireland.

On July 27, 2015, in Altera Corp. v. Commissioner, the U.S. Tax Court issued an opinion related to the treatment of stock-based compensation expense in an intercompany cost-sharing arrangement. In the July 2015 ruling, the Tax Court concluded that the sharing of the cost of employee stock compensation in a company’s cost-sharing arrangement was invalid under the U.S. Administrative Procedures Act. In June 2019, a panel of the Ninth Circuit of the U.S. Court of Appeals reversed this decision. In July 2019, Altera petitioned U.S. Court of Appeals for the Ninth Circuit to hold an en banc rehearing of the case. In November 2019, the en banc rehearing petition was denied, and Altera asked the U.S. Supreme Court for a judicial review. On June 22, 2020, the U.S. Supreme Court declined to issue a writ of certiorari in Altera v Commissioner, leaving intact the decision reached by the Ninth Circuit of the U.S. Court of Appeals. Based on the Ninth Circuit Opinion, the Company recorded a cumulative income tax expense of $25.2 million in the nine months ended December 31, 2020.

In April 2020, the Company became aware of a withholding tax regulation that could be interpreted to apply to certain of the Company’s previous intra-group transactions.  During the nine months ended December 31, 2020, the Company evaluated the interpretations of these rules as it applies to the Company’s facts and circumstances for tax years remaining open under the applicable statutes of limitation and in response the Company recorded an immaterial income tax expense during the period. The Company will evaluate new information as it becomes available and assess its effect to the tax provision.

The Company files U.S. federal, U.S. state, and foreign income tax returns.  For U.S. federal, and in general for U.S. state tax returns, the fiscal 2007 and later tax years remain open for examination by tax authorities.  For foreign tax returns, the Company is generally no longer subject to income tax examinations for years prior to fiscal 2007.

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Note 12. Share-Based Compensation

The following table presents the details of the Company's share-based compensation expense (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Cost of sales (1)	$	6.4	$	5.7	$	18.8	$	15.8
Research and development	25.0		21.2		70.0		63.0
Selling, general and administrative	19.8		16.6		54.5		50.7
Pre-tax effect of share-based compensation	51.2		43.5		143.3		129.5
Income tax benefit	10.7		9.2		30.5		28.2
Net income effect of share-based compensation	$	40.5	$	34.3	$	112.8	$	101.3

(1) During the three and nine months ended December 31, 2020, $4.5 million and $11.9 million, respectively, of share-based compensation expense was capitalized to inventory, and $6.4 million and $18.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold. During the three and nine months ended December 31, 2019, $5.1 million and $15.4 million, respectively, of share-based compensation expense was capitalized to inventory, and $5.7 million and $15.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold.

Note 13. Stock Repurchase Activity

As of December 31, 2020, 15.0 million shares of common stock remained available for repurchase under the existing share repurchase program. There is no expiration date associated with the repurchase program. There were no repurchases of common stock during the three and nine months ended December 31, 2020. Shares repurchased are recorded as treasury shares and used to fund share issuance requirements under the Company's equity incentive plans. As of December 31, 2020, the Company had approximately 11.5 million treasury shares.

Note 14. Accumulated Other Comprehensive Loss

The following table presents the changes in the components of accumulated other comprehensive loss, net of tax, (AOCI) for the nine months ended December 31, 2020 (in millions):

	Minimum Pension Liability		Foreign Currency		Total
Balance at March 31, 2020	$	(5.1)	$	(16.5)	$	(21.6)
Other comprehensive (loss) income before reclassifications	(6.9)		5.3		(1.6)
Reclassification of realized transactions	0.9		—		0.9
Net other comprehensive (loss) income	(6.0)		5.3		(0.7)
Balance at December 31, 2020	$	(11.1)	$	(11.2)	$	(22.3)

The table below details where reclassifications of realized transactions out of accumulated other comprehensive loss are recorded on the consolidated statements of income (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,				Related Statement of Income Line
Description of AOCI Component	2020		2019		2020		2019
Amortization of actuarial loss	$	(0.3)	$	(0.2)	$	(0.9)	$	(0.6)	Other loss, net

Note 15. Dividends

A quarterly cash dividend of $0.3685 per share was paid on December 4, 2020 in the aggregate amount of $96.0 million.  A quarterly cash dividend of $0.39 per share was declared on February 4, 2021 and will be paid on March 8, 2021 to stockholders of record as of February 22, 2021. The Company expects the March 2021 payment of its quarterly cash dividend to be approximately $105.0 million.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Note Regarding Forward-looking Statements

This report, including "Part I – Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Part II - Item 1A Risk Factors" contains certain forward-looking statements that involve risks and uncertainties, including statements regarding our strategy, financial performance and revenue sources.  We use words such as "anticipate," "believe," "plan," "expect," "future," "continue," "intend" and similar expressions to identify forward-looking statements.  Our actual results could differ materially from the results anticipated in these forward-looking statements as a result of certain factors including those set forth under "Risk Factors," beginning at page 43 and elsewhere in this Form 10-Q.  Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  You should not place undue reliance on these forward-looking statements.  We disclaim any obligation to update information contained in any forward-looking statement.  These forward-looking statements include, without limitation, statements regarding the following:

•The impact of the COVID-19 pandemic on demand for our products;

•Our expectation that certain supply chain constraints will continue through most of calendar year 2021.

•That the COVID-19 pandemic could adversely impact our business in the fiscal quarter ended March 31, 2021 or in future periods;

•That local governments could require us or our suppliers to temporarily reduce production further or cease operations and we could experience constraints in fulfilling customer orders;

•Our belief that our actions to combat the spread of COVID-19 will help preserve the health of our team members, customers, suppliers, visitors to our facilities, people with whom we conduct business and our communities, and allow us to safely continue operations;

•Our inability to predict how the COVID-19 pandemic, and actions taken by others in response to it, will affect our business;

•The effects that uncertain global economic conditions and fluctuations in the global credit and equity markets may have on our financial condition and results of operations;

•The effects and amount of competitive pricing pressure on our product lines and modest pricing declines in certain of our more mature proprietary product lines;

•Our ability to moderate future average selling price declines;

•The effect of product mix, capacity utilization, yields, fixed cost absorption, competition and economic conditions on gross margin;

•The amount of, and changes in, demand for our products and those of our customers;

•The impact of national security protections, trade restrictions and changes in tariffs, including those impacting China;

•Our expectation that in the future we will acquire additional businesses that we believe will complement our existing businesses;

•Our expectation that in the future we will enter into joint development agreements or other strategic relationships with other companies;

•The level of orders that will be received and shipped within a quarter, including the impact of our product lead times;

•Our expectation that our March 2021 days of inventory levels will be down 1 to 9 days compared to the December 2020 levels. Our belief that our existing level of inventory will allow us to maintain competitive lead times and provide strong delivery performance to our customers;

•The effect that distributor and customer inventory holding patterns will have on us;

•Our belief that customers recognize our products and brand name and use distributors as an effective supply channel;

•Our belief that our direct sales personnel combined with our distributors provide an effective means of reaching our customer base;

•The accuracy of our estimates of the useful life and values of our property, assets and other liabilities;

•Our ability to increase the proprietary portion of our analog product line and the effect of such an increase;

•Our belief that our processes afford us both cost-effective designs in existing and derivative products and greater functionality in new product designs;

•The impact of any supply disruption we may experience;

•Our ability to effectively utilize our facilities at appropriate capacity levels and anticipated costs;

•That we adjust capacity utilization to respond to actual and anticipated business and industry-related conditions;

•That manufacturing costs will be reduced by transition to advanced process technologies;

•Our ability to maintain manufacturing yields;

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•Continuing our investments in new and enhanced products;

•The cost effectiveness of using our own assembly and test operations;

•The cost savings from re-purposing Fab 5 for the manufacture of discrete and specialty products in addition to a lower volume of a diversified set of standard products and transferring the manufacture of certain higher volume products to other facilities;

•Our anticipated level of capital expenditures;

•Continuation and amount of quarterly cash dividends;

•The sufficiency of our existing sources of liquidity to finance anticipated capital expenditures and otherwise meet our anticipated cash requirements, and the effects that our contractual obligations are expected to have on them;

•The impact of seasonality on our business;

•Our belief that our IT system compromise has not had a material adverse effect on our business or resulted in any material damage to us;

•Our expectation that we will continue to be the target of attacks on our data, attempts to breach our security and attempts to introduce malicious software into our IT systems;

•The accuracy of our estimates used in valuing employee equity awards;

•That the resolution of legal actions will not have a material effect on our business, and the accuracy of our assessment of the probability of loss and range of potential loss;

•The accuracy of our estimated tax rate;

•Our belief that the expiration of any tax holidays will not have a material impact on our effective tax rate;

•The impact of the geographical dispersion of our earnings and losses on our effective tax rate;

•Our belief that the estimates used in preparing our condensed consolidated financial statements are reasonable;

•Our actions to vigorously and aggressively defend and protect our intellectual property on a worldwide basis;

•Our ability to obtain patents and intellectual property licenses and minimize the effects of litigation;

•The level of risk we are exposed to for product liability claims or indemnification claims;

•The effect of fluctuations in market interest rates on our income and/or cash flows;

•The effect of fluctuations in currency rates;

•That we could increase our borrowings or seek additional equity or debt financing to maintain or expand our facilities, or to fund cash dividends, share repurchases, acquisitions or other corporate activities, and that the timing and amount of such financing requirements will depend on a number of factors;

•Our intention to satisfy the lesser of the principal amount or the conversion value of our Convertible Debt in cash;

•Our intention to invest substantially all of our foreign subsidiary earnings, as well as our capital in our foreign subsidiaries, indefinitely outside of the U.S. in those jurisdictions in which we would incur significant, additional costs upon repatriation of such amounts; 

•Changes to the taxation of undistributed foreign earnings could change our future intentions regarding reinvestment of such earnings;

•Our expectation that our reliance on third party contractors may increase over time as our business grows;

•Our ability to collect accounts receivable; and

•The impact of the legislative and policy changes implemented or which may be implemented by the new administration, on our business and the trading price of our stock.

Our actual results could differ materially from the results anticipated in these forward-looking statements as a result of certain factors including those set forth in "Item 1A – Risk Factors," and elsewhere in this Form 10-Q.  Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  You should not place undue reliance on these forward-looking statements.  We disclaim any obligation to update the information contained in any forward-looking statement.

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Introduction

The following discussion should be read in conjunction with the condensed consolidated financial statements and the related notes that appear elsewhere in this document.

We begin our Management's Discussion and Analysis of Financial Condition and Results of Operations with a summary of COVID-19 developments followed by a summary of our overall business strategy to give the reader an overview of the goals of our business and the overall direction of our business and products. This is followed by a discussion of the Critical Accounting Policies and Estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results. We then discuss our Results of Operations for the three and nine months ended December 31, 2020 compared to the three and nine months ended December 31, 2019. We then provide an analysis of changes in our balance sheet and cash flows, and discuss our financial commitments in sections titled "Liquidity and Capital Resources", "Contractual Obligations" and "Off-Balance Sheet Arrangements."

COVID-19 Developments

The ongoing COVID-19 pandemic has resulted in a global disruption in economic activity by adversely affecting production, creating supply chain and market disruption, and adversely impacting businesses and individuals. The severity and duration of the economic impact is currently unknown and will depend on many factors, such as the effectiveness of containment efforts. We regularly monitor new information regarding the severity of COVID-19 and the ability to contain, treat, or prevent it.

In the fiscal quarter ended December 31, 2020, demand for our products that serve certain markets, such as consumer, automotive, and industrial, continued to recover from the adverse demand fluctuations caused by the COVID-19 pandemic. Additionally, the markets that benefited earlier in the year from the stay-at-home economy, such as datacenters, computing, and communications, remained at normal demand patterns as the surge in demand we experienced in the June 2020 quarter dissipated. Furthermore, demand for our products that are used in the office environment remained weak as many businesses have applied work from home policies throughout the COVID-19 pandemic, thus deferring spending for the office environment. While we have a diverse customer base operating in diverse industries, the extent of the impact of the COVID-19 pandemic on demand for our products depends on unpredictable future developments.

At this time, our global manufacturing sites and our logistics channels are fully operational and local restrictions related to the COVID-19 pandemic that impacted us in the first quarter of fiscal 2021 have eased. We have experienced supply chain constraints that continued to become more challenging through the fiscal quarter ended December 31, 2020, due to recovery in demand for our products in the consumer, automotive, and industrial markets along with low levels of inventory in the distribution channels. We continue to invest in capital expenditures to increase our internal production capacity. We have expanded and are continuing our efforts to expand the amount of allocation we receive from our wafer fabrication, assembly and test subcontractors. However, we expect the supply chain constraints to continue through most of calendar year 2021. As a result, lead times have increased for many of our products. We have also experienced increases in material and subcontracted manufacturing costs and we have taken steps to secure capacity for calendar year 2021. If the number of COVID-19 cases increases, the pandemic could adversely impact our business in future periods. In the future, local governments could require us or our suppliers to temporarily reduce production or cease operations and we could experience constraints in fulfilling customer orders.

In response to the early indications of the COVID-19 pandemic, we took proactive measures to safeguard the health of our employees, contractors, customers, suppliers, visitors to our facilities, other business partners, and our communities. We strategically implemented plans intended to ensure business continuity in the event severe outbreaks or government requirements were to impact our operations. We are committed to the health and safety of our employees, contractors, customers, suppliers, visitors to our facilities, other business partners, and communities. We are following governmental policies and CDC recommendations designed to slow the spread of COVID-19.

Our efforts to combat the COVID-19 pandemic include the following:

•We require social distancing, and have established distancing protocols at our facilities. We currently prohibit visitors, have suspended business travel, have suspended attendance at conferences and other gatherings, and require team members to work from home to the extent possible. Where work from home is not possible, all on-site team members are requested to take their temperatures before arriving to work, stay home if they do not feel well, stay home if they have been exposed to someone with COVID-19 or its symptoms, maintain a safe distance from others, wash their hands frequently, and wear a mask if they choose. We clean high touch surfaces daily.

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•In partnership with our suppliers, we have evaluated our supply chain to identify gaps or weak points. In order to ensure continuity, in some cases, we have qualified alternative suppliers and increased our inventory of raw materials.

•We have added and continue to add assembly and test capacity to provide redundant manufacturing capability through our network of subcontractors.

•We implemented measures to help prepare for economic uncertainty, such as employee salary cuts, limiting hiring, reducing business travel costs, reducing discretionary spending, and limiting capital expenditures. During the fiscal quarter ended December 31, 2020, we restored previous reductions in compensation, resumed hiring, and increased spending for certain capital expenditures to help meet business demands.

•We are working with government authorities in the areas where we have a significant footprint. We continue to update ourselves on government requirements, relevant regulations, industry standards, and best practices to help safeguard our team members across the globe.

We believe these actions are important and will help preserve the health of our team members, customers, suppliers, visitors to our facilities, people with whom we conduct business and our communities, and allow us to safely continue operations. However, we cannot predict how these actions, or the actions taken by government entities, suppliers, or customers in response to the COVID-19 pandemic will impact our business, revenues, or results of operations.

Strategy

Our goal is to be a worldwide leader in providing specialized semiconductor products for a wide variety of embedded control applications.  Our strategic focus is on embedded control solutions, including general purpose and specialized 8-bit, 16-bit, and 32-bit microcontrollers, microprocessors, FPGA products, a broad spectrum of high-performance linear, mixed-signal, power management, thermal management, discrete diodes and MOSFETS, RF, timing, timing systems, safety, security, wired connectivity and wireless connectivity devices, as well as Serial EEPROM, Serial Flash memories, Parallel Flash memories, Serial EERAM and Serial SRAM. We also license Flash-IP solutions that are incorporated in a broad range of products.  We provide highly cost-effective embedded control solutions that also offer the advantages of small size, high performance, extreme low power usage, wide voltage range operation, mixed signal integration and ease of development, thus enabling timely and cost-effective integration of our solutions by our customers in their end products.  We license our SuperFlash technology and other technologies to wafer foundries, integrated device manufacturers and design partners throughout the world for use in the manufacture of advanced microcontroller products, gate array, RF and analog products that require embedded non-volatile memory. Our broad product portfolio allows us to provide Total System Solutions (TSS) to our customers by being able to provide a large portion of the silicon requirements in their applications. TSS is a combination of hardware, software and services which help our customers increase their revenue, reduce their costs and manage their risks.

We sell our products to a broad base of domestic and international customers across a variety of industries. The principal markets that we serve include consumer, automotive, industrial, aerospace, office communication, and computing.  Our business is subject to fluctuations based on economic conditions within these markets. 

Our manufacturing operations include wafer fabrication, wafer probe and assembly and test.  The ownership of a substantial portion of our manufacturing resources is an important component of our business strategy, enabling us to maintain a high level of manufacturing control resulting in us being one of the lowest cost producers in the embedded control industry.  By owning wafer fabrication facilities and assembly and test operations, and by employing statistical process control techniques, we have been able to achieve and maintain high production yields.  Direct control over manufacturing resources allows us to shorten our design and production cycles.  This control also allows us to capture a portion of the wafer manufacturing and the assembly and test profit margin. We do outsource a significant portion of our manufacturing requirements to third parties.  Our acquisition of Microsemi, in May 2018, significantly increased the amount of our outsourced manufacturing requirements.

We employ proprietary design and manufacturing processes in developing our embedded control products.  We believe our processes afford us both cost-effective designs in existing and derivative products and greater functionality in new product designs.  While many of our competitors develop and optimize separate processes for their logic and memory product lines, we use a common process technology for both microcontroller and non-volatile memory products.  This allows us to more fully leverage our process research and development costs and to deliver new products to market more rapidly.  Our engineers utilize advanced computer-aided design tools and software to perform circuit design, simulation and layout, and our in-house

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photomask and wafer fabrication facilities enable us to rapidly verify design techniques by processing test wafers quickly and efficiently. 

We are committed to continuing our investment in new and enhanced products, including development systems, and in our design and manufacturing process technologies.  We believe these investments are significant factors in maintaining our competitive position.  Our current research and development activities focus on the design of new microcontrollers, digital signal controllers, memory, analog and mixed-signal products, FPGAs, timing systems, Flash-IP, development systems, software and application-specific software libraries.  We are also developing new design and process technologies to achieve further cost reductions and performance improvements in our products. 

We market and sell our products worldwide primarily through a network of direct sales personnel and distributors.  Our distributors focus primarily on servicing the product and technical support requirements of a broad base of diverse customers.  We believe that our direct sales personnel combined with our distributors provide an effective means of reaching this broad and diverse customer base.  Our direct sales force focuses primarily on major strategic accounts in three geographical markets: the Americas, Europe and Asia.  We currently maintain sales and support centers in major metropolitan areas in North America, Europe and Asia.  We believe that a strong technical service presence is essential to the continued development of the embedded control market.  Many of our CEMs, ESEs, and sales management personnel have technical degrees and have been previously employed in an engineering environment.  We believe that the technical and business knowledge of our sales force is a key competitive advantage in the sale of our products.  The primary mission of our ESE team is to provide technical assistance to strategic accounts and to conduct periodic training sessions for CEMs and distributor sales teams.  ESEs also frequently conduct technical seminars for our customers in major cities around the world or through online webcasts, and work closely with our distributors to provide technical assistance and end-user support.

See "Our operating results are impacted by seasonality and wide fluctuations of supply and demand in the industry," on page 47 for discussion of the impact of seasonality on our business.

Critical Accounting Policies and Estimates

There were no changes to our critical accounting policies and estimates during the first nine months of the fiscal year ending March 31, 2021 compared to our "Critical Accounting Policies and Estimates" as previously described in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended March 31, 2020.

Results of Operations

The following table sets forth certain operational data as a percentage of net sales for the periods covered by this report:

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net sales	100.0	%	100.0	%	100.0	%	100.0	%
Cost of sales	37.4		39.0		38.3		38.5
Gross profit	62.6		61.0		61.7		61.5
Research and development	15.5		16.9		15.3		16.6
Selling, general and administrative	11.4		13.3		11.2		12.9
Amortization of acquired intangible assets	17.2		19.2		17.6		19.0
Special charges and other, net	0.3		1.4		0.2		0.7
Operating income	18.2	%	10.2	%	17.4	%	12.3	%

Net Sales

We operate in two industry segments and engage primarily in the design, development, manufacture and sale of semiconductor products as well as the licensing of our SuperFlash and other technologies.  We sell our products to distributors and original equipment manufacturers, referred to as OEMs, in a broad range of markets, perform ongoing credit evaluations of our customers and generally require no collateral.  In certain circumstances, a customer's financial condition may require collateral, and, in such cases, the collateral would be typically provided by letters of credit.

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The following table summarizes our net sales for the periods covered by this report (dollars in millions):

	Three Months Ended						Nine Months Ended
	December 31,						December 31,
	2020		2019		Change		2020		2019		Change
Net sales	$	1,352.1	$	1,287.4	5.0	%	$	3,971.3	$	3,947.8	0.6	%

The increase in net sales in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 was primarily due to strength in our microcontroller and analog product lines. The net sales value of inventory at our distributor customers decreased $26.1 million during the three months ended December 31, 2020 compared to a decrease of $36.1 million during the three months ended December 31, 2019. Excluding the impact of changes in distributor inventory levels on net sales, demand increased by 4.1% in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 and was positively impacted by strength in our microcontroller and analog product lines. Due to the size, complexity and diversity of our customer base, we are not able to quantify any material factor contributing to the change other than demand fluctuations in the end markets that we serve.

The increase in net sales in the nine months ended December 31, 2020 compared to the nine months ended December 31, 2019 was primarily due to the positive impact of changes in distributor inventory levels offset by adverse demand fluctuations in the markets we serve. The net sales value of inventory at our distributor customers increased $12.4 million during the nine months ended December 31, 2020, compared to a decrease of $71.9 million during the nine months ended December 31, 2019. Excluding the impact of changes in distributor inventory levels on net sales, demand decreased by 1.5% in the nine months ended December 31, 2020 compared to the nine months ended December 31, 2019 and was negatively impacted by general economic conditions and the impact of the COVID-19 pandemic. Due to the size, complexity and diversity of our customer base, we are not able to quantify the impact that general economic conditions and the COVID-19 pandemic had on each of the end markets that we serve.

Other factors that we believe contributed to changes in our reported net sales for the three and nine months ended December 31, 2020 compared to the three and nine months ended December 31, 2019 and which are drivers of long-term trends in our net sales but which factors we are not able to quantify include:

•semiconductor industry conditions;

•our various new product offerings that have increased our served available market;

•customers’ increasing needs for the flexibility offered by our programmable solutions; and

•increasing semiconductor content in our customers’ products.

We sell a large number of products to a large and diverse customer base and there was not any single product or customer that accounted for a material portion of the change in our net sales in the three and nine months ended December 31, 2020 compared to the same prior year periods. The overall average selling price of our products is affected by pricing declines over the life of individual products; however, variations in our product and geographic mix of sales can cause wider fluctuations in our overall average selling price in any given period. The overall average selling price of our products did not change significantly during the three and nine months ended December 31, 2020 compared to the same prior year periods.

Net sales by product line for the periods covered by this report were as follows (dollars in millions):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2020		%	2019		%	2020		%	2019		%
Microcontrollers	$	726.3	53.7	$	685.8	53.3	$	2,145.8	54.1	$	2,091.8	53.0
Analog	372.8		27.6	363.3		28.2	1,104.7		27.8	1,143.6		29.0
FPGA	99.1		7.3	92.6		7.2	294.3		7.4	276.8		7.0
LMO	153.9		11.4	145.7		11.3	426.5		10.7	435.6		11.0
Total net sales	$	1,352.1	100.0	$	1,287.4	100.0	$	3,971.3	100.0	$	3,947.8	100.0

Microcontrollers

Our microcontroller product line represents the largest component of our total net sales.  Microcontrollers and associated application development systems accounted for approximately 53.7% and 54.1% of our net sales for the three and nine months

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ended December 31, 2020, respectively, compared to approximately 53.3% and 53.0% of our net sales for the three and nine months ended December 31, 2019, respectively.

Net sales of our microcontroller products increased 5.9% and 2.6% in the three and nine months ended December 31, 2020, respectively, compared to the three and nine months ended December 31, 2019. These sales increases were due primarily to strength in demand for our microcontroller products in certain end markets that we serve.

Historically, average selling prices in the semiconductor industry decrease over the life of any particular product.  The overall average selling prices of our microcontroller products have remained relatively constant over time due to the proprietary nature of these products.  We have experienced, and expect to continue to experience, moderate pricing pressure in certain microcontroller product lines, primarily due to competitive conditions. We have in the past been able to, and expect in the future to be able to, moderate average selling price declines in our microcontroller product lines by introducing new products with more features and higher prices.  We may be unable to maintain average selling prices for our microcontroller products as a result of increased pricing pressure in the future, which would adversely affect our operating results. The average selling price of our microcontroller products is affected by these trends; however, variations in our product and geographic mix of sales can cause wider fluctuations in the average selling price of our microcontroller products in any given period.

Analog

Our analog product line includes analog, interface, mixed signal and timing products. Our analog product line accounted for approximately 27.6% and 27.8% of our net sales for the three and nine months ended December 31, 2020, respectively, compared to approximately 28.2% and 29.0% of our net sales for the three and nine months ended December 31, 2019, respectively.

Net sales from our analog product line increased 2.6% and decreased 3.4% in the three and nine months ended December 31, 2020, respectively, compared to the three and nine months ended December 31, 2019. The increase in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 was primarily due to strength in demand for our analog products in certain end markets that we serve. The decrease in the nine months ended December 31, 2020 compared to the nine months ended December 31, 2019 was primarily due to adverse general economic conditions and the impact of the COVID-19 pandemic.

Currently, we consider a majority of the products in our analog product line to be proprietary in nature, where prices are relatively stable, similar to the pricing stability experienced in our microcontroller products. The non-proprietary portion of our analog product line will experience price fluctuations, driven primarily by the current supply and demand for those products. We may be unable to maintain the average selling prices of our analog product line as a result of increased pricing pressure in the future, which would adversely affect our operating results. We anticipate the proprietary portion of our analog product line will increase over time. 

FPGA

Sales of our FPGA products accounted for approximately 7.3% and 7.4% of our net sales for the three and nine months ended December 31, 2020, respectively, compared to approximately 7.2% and 7.0% of our net sales for the three and nine months ended December 31, 2019, respectively.

Net sales of our FPGA products increased 7.0% and 6.3% in the three and nine months ended December 31, 2020, respectively, compared to the three and nine months ended December 31, 2019. These sales increases were primarily due to favorable demand fluctuations for FPGA products in the markets we serve.

FPGA product pricing has historically been relatively stable because they are proprietary products with significant design in complexity and are frequently designed into long-lived end applications.

LMO

Our LMO product line includes royalties associated with licenses for the use of our SuperFlash and other technologies, sales of our intellectual property, fees for engineering services, memory products, timing systems, manufacturing services (wafer foundry and assembly and test subcontracting), legacy application specific integrated circuits, and products for aerospace applications. Revenue from these services and products accounted for approximately 11.4% and 10.7% of our net sales for the three and nine months ended December 31, 2020, respectively, compared to approximately 11.3% and 11.0% of our net sales for the three and nine months ended December 31, 2019, respectively.

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Net sales related to these services and products increased 5.6% and decreased 2.1% in the three and nine months ended December 31, 2020, respectively, compared to the three and nine months ended December 31, 2019. LMO net sales can fluctuate over time based on general economic and semiconductor industry conditions as well as changes in demand for our licenses, engineering services, memory products, and manufacturing services (wafer foundry and assembly and test subcontracting).

Distribution

Distributors accounted for approximately 50% and 51% of our net sales in the three and nine months ended December 31, 2020, respectively, and approximately 50% of our net sales in each of the three and nine months ended December 31, 2019. With the exception of Arrow Electronics, our largest distributor, which represented 10% and 11% of our net sales in the three and nine months ended December 31, 2019, respectively, no other distributor or end customer accounted for more than 10% of our net sales in the three and nine months ended December 31, 2020 and December 31, 2019. Our distributors focus primarily on servicing the product requirements of a broad base of diverse customers. We believe that distributors provide an effective means of reaching this broad and diverse customer base.  We believe that customers recognize Microchip for its products and brand name and use distributors as an effective supply channel.

Generally, we do not have long-term agreements with our distributors and we, or our distributors, may terminate our relationships with each other with little or no advance notice.  The loss of, or the disruption in the operations of, one or more of our distributors could reduce our future net sales in a given quarter and could result in an increase in inventory returns.

At December 31, 2020, our distributors maintained 26 days of inventory of our products compared to 29 days at March 31, 2020.  Over the past ten fiscal years, the days of inventory maintained by our distributors have fluctuated between approximately 26 days and 47 days.  Inventory holding patterns at our distributors may have a material impact on our net sales.

Sales by Geography

Sales by geography for the periods covered by this report were as follows (dollars in millions):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2020		%	2019		%	2020		%	2019		%
Americas	$	348.9	25.8	$	309.8	24.1	$	1,037.3	26.1	$	1,011.1	25.6
Europe	243.0		18.0	276.2		21.5	725.9		18.3	870.3		22.0
Asia	760.2		56.2	701.4		54.4	2,208.1		55.6	2,066.4		52.4
Total net sales	$	1,352.1	100.0	$	1,287.4	100.0	$	3,971.3	100.0	$	3,947.8	100.0

Americas sales include sales to customers in the U.S., Canada, Central America and South America. Sales to foreign customers accounted for approximately 77% and 76% of our total net sales in the three and nine months ended December 31, 2020, respectively, compared to approximately 79% of our total net sales in each of the three and nine months ended December 31, 2019. Substantially all of our foreign sales are U.S. dollar denominated. Sales to customers in Europe as a percentage of total sales decreased in the three and nine months ended December 31, 2020 compared to the three and nine months ended December 31, 2019 primarily due to the impact of the COVID-19 pandemic on our customers that service the automotive and industrial markets in Europe. Sales to customers in Asia as a percentage of total sales increased in the three and nine months ended December 31, 2020 compared to the three and nine months ended December 31, 2019 due to the fact that the COVID-19 pandemic was largely under control in China and Taiwan, which represent the highest percentage of our net sales in Asia, during the three and nine months ended December 31, 2020, and therefore, the geography returned to higher levels of demand. Our sales force in the Americas and Europe supports a significant portion of the design activity for products which are ultimately shipped to Asia.

Gross Profit

Our gross profit in the three months ended December 31, 2020 was $845.8 million, or 62.6% of net sales, compared to $785.5 million, or 61.0% of net sales, in the three months ended December 31, 2019. Our gross profit in the nine months ended December 31, 2020 was $2.45 billion, or 61.7% of net sales, compared to $2.43 billion, or 61.5% of net sales, in the nine months ended December 31, 2019. The following table summarizes the material and primary drivers of our change in gross profit as a percentage of net sales, with the material factors discussed in more detail below the table (dollars in millions):

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Gross Profit		% of Net Sales	Gross Profit		% of Net Sales
$	785.5	61.0	$	2,428.2	61.5	Three and nine months ended December 31, 2019
38.5		—	10.9		—	Increase in semiconductor net sales at prior year gross margins and excluding the impact of other factors quantified in this table
13.4		1.0	3.5		0.1	Impact of unabsorbed capacity charges
3.6		0.3	2.8		0.1	Impact of lower costs per unit related to sold inventory
1.8		0.1	5.2		0.1	Increase in net sales to licensing customers, which has no associated cost of sales
2.9		0.2	1.2		—	Impact of excess and obsolete inventories
0.1		—	0.2		(0.1)	Other individually immaterial factors
$	845.8	62.6	$	2,452.0	61.7	Three and nine months ended December 31, 2020

Unabsorbed capacity charges - When production levels are below normal capacity, which we measure as a percentage of the capacity of the installed equipment, we charge cost of sales for the unabsorbed capacity. During the three and nine months ended December 31, 2020, we operated at below normal capacity levels due to lower demand for our products primarily related to general economic conditions and uncertainty from the COVID-19 pandemic resulting in unabsorbed capacity charges of $3.7 million and $29.8 million, respectively, compared to unabsorbed capacity charges of $17.1 million and $33.3 million in the three and nine months ended December 31, 2019, respectively. We adjust our wafer fabrication and assembly and test capacity utilization as required to respond to actual and anticipated business and industry-related conditions.

Costs per unit related to sold inventory - Our product cost per unit may fluctuate over time due to cost of materials and other factors and also fluctuate based on the mix of products sold. During the three and nine months ended December 31, 2020, product mix resulted in $3.6 million and $2.8 million, respectively, lower cost of goods sold and increase in gross profit than the comparable metric in the three and nine months ended December 31, 2019, respectively.

The process technologies utilized in our wafer fabrication facilities impact our gross margins.  Our wafer fabrication facility located in Tempe, Arizona (Fab 2) currently utilizes various manufacturing process technologies, but predominantly utilizes our 0.5 micron to 1.0 micron processes.  Our wafer fabrication facility located in Gresham, Oregon (Fab 4) predominantly utilizes our 0.13 micron to 0.5 micron processes.  We continue to transition products to more advanced process technologies to reduce future manufacturing costs.  All of our production in Fab 2 and Fab 4 has been on 8-inch wafers during the periods covered by this report. We consider normal capacity at Fab 2 and Fab 4 to be 90% to 95%. Our wafer fabrication facility in Colorado Springs, Colorado (Fab 5) currently utilizes processes between 0.25 micron and 1.0 micron that run on 6-inch wafers. We consider normal capacity at Fab 5 to be 70% to 75%.

Our overall inventory levels were $666.1 million at December 31, 2020, compared to $685.7 million at March 31, 2020. We maintained 120 days of inventory on our balance sheet at December 31, 2020 compared to 122 days of inventory at March 31, 2020. We expect our days of inventory levels in the March 2021 quarter to be down 1 to 9 days compared to the December 2020 levels.

We anticipate that our gross margins will fluctuate over time, driven primarily by capacity utilization levels, the overall product mix of microcontroller, analog, FPGA, memory products, and technology licensing revenue and the percentage of net sales of each of these products in a particular quarter, as well as manufacturing yields, fixed cost absorption, and competitive and economic conditions in the markets we serve.

During fiscal 2020, we announced our intention to re-purpose Fab 5 to manufacture discrete and specialty products in addition to a lower volume of a diversified set of standard products. In connection with these efforts, we reduced the clean room footprint and transferred certain higher volume products from Fab 5 to our 8-inch wafer fabrication facilities in Arizona and Oregon. We anticipate that these actions will result in significant cost savings over the next several years. In fiscal 2020, we incurred $18.0 million in costs associated with these actions and during the nine months ended December 31, 2020, we incurred $7.0 million in such costs, all of which have been recorded within the special charges and other, net line item in our statements of income. We expect to incur less than $2.0 million in the fourth quarter of fiscal 2021 for the remaining associated costs of these restructuring activities.

We operate assembly and test facilities in Thailand, the Philippines, and other locations throughout the world. Approximately 55% of our assembly requirements were performed in our internal assembly facilities in the three months ended December 31, 2020, compared to approximately 45% during the three months ended December 31, 2019.  Approximately 57%

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of our test requirements were performed in our internal test facilities in the three months ended December 31, 2020, compared to approximately 54% during the three months ended December 31, 2019.  The increases in the percentage of assembly and test operations that were performed internally in fiscal 2021 compared to fiscal 2020 are primarily due to our investments in assembly and test equipment, which increased our internal capacity capabilities. Third-party contractors located primarily in Asia perform the balance of our assembly and test operations. The percentage of our assembly and test operations that are performed internally fluctuates over time based on supply and demand conditions in the semiconductor industry, our internal capacity capabilities and our acquisition activities. We believe that the assembly and test operations performed at our internal facilities provide us with significant cost savings compared to contractor assembly and test costs, as well as increased control over these portions of the manufacturing process. We plan to continue to transition certain outsourced assembly and test capacity to our internal facilities.

We rely on outside wafer foundries for a significant portion of our wafer fabrication requirements. Approximately 61% of our net sales came from products that were produced at outside wafer foundries in each of the three months ended December 31, 2020 and December 31, 2019.

Our use of third parties involves some reduction in our level of control over the portions of our business that we subcontract.  While we review the quality, delivery and cost performance of our third-party contractors, our future operating results could suffer if any third-party contractor is unable to maintain manufacturing yields, assembly and test yields and costs at approximately their current levels.

Research and Development

R&D expenses for the three months ended December 31, 2020 were $210.1 million, or 15.5% of net sales, compared to $217.1 million, or 16.9% of net sales, for the three months ended December 31, 2019. R&D expenses for the nine months ended December 31, 2020 were $607.9 million, or 15.3% of net sales, compared to $656.0 million, or 16.6% of net sales, for the nine months ended December 31, 2019. We are committed to investing in new and enhanced products, including development systems software, and in our design and manufacturing process technologies.  We believe these investments are significant factors in maintaining our competitive position.  R&D costs are expensed as incurred.  Assets purchased to support our ongoing research and development activities are capitalized when related to products which have achieved technological feasibility or that have alternative future uses and are amortized over their expected useful lives.  R&D expenses include labor, depreciation, masks, prototype wafers, and expenses for the development of process technologies, new packages, and software to support new products and design environments.

R&D expenses decreased $7.0 million, or 3.2%, for the three months ended December 31, 2020 over the same period last year.  R&D expenses decreased $48.1 million, or 7.3%, for the nine months ended December 31, 2020 over the same period last year. The primary reason for the decreases in R&D costs was due to management of discretionary spending, including reduced headcount costs and travel expenses, due to uncertainty surrounding the COVID-19 pandemic.

R&D expenses fluctuate over time, primarily due to revenue and operating expense investment levels.

Selling, General and Administrative

Selling, general and administrative expenses for the three months ended December 31, 2020 were $154.2 million, or 11.4% of net sales, compared to $170.7 million, or 13.3% of net sales, for the three months ended December 31, 2019. Selling, general and administrative expenses for the nine months ended December 31, 2020 were $445.2 million, or 11.2% of net sales, compared to $510.9 million, or 12.9% of net sales, for the nine months ended December 31, 2019.  Our goal is to continue to be more efficient with our selling, general and administrative expenses. Selling, general and administrative expenses include salary expenses related to field sales, marketing and administrative personnel, advertising and promotional expenditures and legal expenses as well as costs related to our direct sales force, CEMs and ESEs who work remotely from sales offices worldwide to stimulate demand by assisting customers in the selection and use of our products.

Selling, general and administrative expenses decreased $16.5 million, or 9.7%, for the three months ended December 31, 2020 over the same period last year.  Selling, general and administrative expenses decreased $65.7 million, or 12.9%, for the nine months ended December 31, 2020 over the same period last year.  The primary reason for the decreases in selling, general and administrative expenses was due to management of discretionary spending, including reduced headcount costs and travel expenses, due to uncertainty surrounding the COVID-19 pandemic.

Selling, general and administrative expenses fluctuate over time, primarily due to revenue and operating expense investment levels.

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Amortization of Acquired Intangible Assets

Amortization of acquired intangible assets for the three and nine months ended December 31, 2020 was $231.6 million and $699.9 million, respectively, compared to $248.7 million and $745.4 million for the three and nine months ended December 31, 2019, respectively. The primary reason for the decreases in acquired intangible asset amortization was lower amortization from our acquisition of Microsemi and from our prior acquisitions.

Special Charges and Other, Net

During the three and nine months ended December 31, 2020, we incurred special charges and other, net of $4.3 million and $8.9 million, respectively. During the three and nine months ended December 31, 2019, we incurred special charges and other, net of $17.8 million and $29.5 million, respectively. The costs incurred during the nine months ended December, 31 2020 were primarily related to restructuring of our wafer fabrication operations. Other restructuring expenses incurred during the nine months ended December 31, 2020 and December 31, 2019 were related to our most recent business acquisitions, and resulted from workforce, property and other operating expense rationalizations as well as combining product roadmaps and manufacturing operations.

Other Income (Expense)

Interest income in the three and nine months ended December 31, 2020 was $0.2 million and $0.8 million, respectively, compared to $0.6 million and $2.3 million, respectively, for the three and nine months ended December 31, 2019.

Interest expense in the three and nine months ended December 31, 2020 was $86.5 million and $278.9 million, respectively, compared to $119.7 million and $381.9 million, respectively, for the three and nine months ended December 31, 2019. The primary reason for the decreases in interest expense relates to the cumulative pay down of our debt and lower interest rates on our outstanding variable rate debt.

During the three and nine months ended December 31, 2020, we recognized losses of $142.1 million and $214.0 million, respectively, related to the settlement of a portion of our outstanding 2015 Senior Convertible Debt, our 2017 Senior Convertible Debt, and our 2017 Junior Convertible Debt as well as the payment of all amounts outstanding under our Bridge Loan Facility, and our Term Loan Facility. The net losses recognized on the settlement of our Convertible Debt are comprised of two components (i) the inducement loss, which is the excess of the fair value of the consideration provided to the holder over the fair value of the debt and (ii) the extinguishment loss or gain, which is the difference between the fair value of the debt component and the carrying value on the settlement date. During the nine months ended December 31, 2019, we recognized losses of $2.0 million, in connection with the amendment to our Revolving Credit Facility and the voluntary prepayment of a portion of the outstanding balance on our Term Loan Facility.

Other loss, net was $0.4 million and $2.9 million for the three and nine months ended December 31, 2020, respectively, compared to $1.5 million and $0.2 million for the three and nine months ended December 31, 2019, respectively.

Provision for Income Taxes

We account for incomes taxes in accordance with ASC 740. Our provision or benefit for income taxes is attributable to U.S. federal, state, and foreign income taxes. A comparison of our effective tax rates for the nine months ended December 31, 2020 and December 31, 2019 is not meaningful due to the amount of pre-tax income, and income tax benefits recorded during the period.

We are subject to taxation in many jurisdictions in which we have operations. The effective tax rates that we pay in these jurisdictions vary widely, but they are generally lower than our combined U.S. federal and state effective tax rate. Our domestic statutory tax rate for the nine months ended December 31, 2020 was approximately 22% and our domestic statutory tax rate for the fiscal year ended March 31, 2020 was approximately 22%. Our non-U.S. blended statutory tax rates for the nine months ended December 31, 2020 and fiscal year ended March 31, 2020 were much lower than this amount. The difference in rates applicable in foreign jurisdictions results from a number of factors, including lower statutory rates, tax holidays, financing arrangements and other factors. Our effective tax rate has been, and will continue to be impacted by the geographical dispersion of our earnings and losses.

Our foreign tax rate differential benefit primarily relates to our operations and assets in Thailand, Malta and Ireland. Our Thailand manufacturing operations are currently subject to numerous tax holidays granted to us based on our investment in

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property, plant and equipment in Thailand. Our tax holiday periods in Thailand expire at various times in the future; however, we actively seek to obtain new tax holidays, otherwise we will be subject to tax at the statutory tax rate of 20%. We do not expect the future expiration of any of our tax holiday periods in Thailand to have a material impact on our effective tax rate.  The remaining material components of foreign income taxed at a rate lower than the U.S. are earnings accrued in Ireland at a 12.5% statutory tax rate and earnings accrued in Malta at a 0% to 5% tax rate.

Various taxing authorities in the U.S. and other countries in which we do business are increasing their scrutiny of the tax structures employed by businesses.  Companies of our size and complexity are regularly audited by the taxing authorities in the jurisdictions in which they conduct significant operations.  For U.S. federal, and in general for U.S. state tax returns, our fiscal 2007 and later tax returns remain effectively open for examination by the taxing authorities. We are currently being audited by the tax authorities in the United States and in various foreign jurisdictions. At this time, we do not know what the outcome of these audits will be. We record benefits for uncertain tax positions based on an assessment of whether it is more likely than not that the tax positions will be sustained based on their technical merits under currently enacted law. If this threshold is not met, no tax benefit of the uncertain tax position is recognized. If the threshold is met, we recognize the largest amount of the tax benefit that is more than 50% likely to be realized upon ultimate settlement.

On July 27, 2015, in Altera Corp. v. Commissioner, the U.S. Tax Court issued an opinion related to the treatment of stock-based compensation expense in an intercompany cost-sharing arrangement. In the July 2015 ruling, the Tax Court concluded that the sharing of the cost of employee stock compensation in a company’s cost-sharing arrangement was invalid under the U.S. Administrative Procedures Act. In June 2019, a panel of the Ninth Circuit of the U.S. Court of Appeals reversed this decision. In July 2019, Altera petitioned U.S. Court of Appeals for the Ninth Circuit to hold an en banc rehearing of the case. In November 2019, the en banc rehearing petition was denied, and Altera asked the U.S. Supreme Court for a judicial review. On June 22, 2020, the U.S. Supreme Court declined to issue a writ of certiorari in Altera v Commissioner, leaving intact the decision reached by the Ninth Circuit of the U.S. Court of Appeals. Based on the Ninth Circuit Opinion, we recorded a cumulative income tax expense of $25.2 million in the nine months ended December 31, 2020.

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Liquidity and Capital Resources

We had $372.7 million in cash, cash equivalents and short-term investments at December 31, 2020, a decrease of $30.3 million from the March 31, 2020 balance.  

Net cash provided by operating activities was $1.47 billion in the nine months ended December 31, 2020 compared to $1.17 billion in the nine months ended December 31, 2019. The increase in net cash provided by operating activities was primarily due to efforts focused on working capital and discretionary spending management.

Net cash used in investing activities was $110.1 million in the nine months ended December 31, 2020 compared to $97.7 million in the nine months ended December 31, 2019. During the nine months ended December 31, 2020 and December 31, 2019, net investing activities primarily related to capital purchases and investments in other assets.

Our level of capital expenditures varies from time to time as a result of actual and anticipated business conditions. Capital expenditures in the nine months ended December 31, 2020 were $37.2 million compared to $55.7 million in the nine months ended December 31, 2019. Capital expenditures were primarily for the expansion of production capacity and the addition of research and development equipment. We currently intend to spend between $175 million and $200 million during the next twelve months to invest in equipment and facilities. We believe that the capital expenditures anticipated to be incurred over the next twelve months will provide sufficient manufacturing capacity to support the growth of our production capabilities for our new products and technologies and to bring in-house more of the assembly and test operations that are currently outsourced. We expect to finance our capital expenditures through our existing cash balances and cash flows from operations. 

Net cash used in financing activities was $1.39 billion in the nine months ended December 31, 2020 compared to $1.11 billion in the nine months ended December 31, 2019. Significant transactions affecting our net financing cash flows include:

•in the first nine months of fiscal 2021, $1.04 billion of cash used to pay down certain principal of our debt, including the Term Loan Facility and the cash portion of the settlement of our 2015 Senior Convertible Debt, our 2017 Senior Convertible Debt, and our 2017 Junior Convertible Debt, partially funded by the issuance of our senior notes,

•in the first nine months of fiscal 2020, $830.0 million of cash used to pay down certain principal on the Term Loan Facility and the Revolving Credit Facility, net of amounts borrowed under our Revolving Credit Facility, and

•in the first nine months of fiscal 2021 and fiscal 2020, we paid cash dividends to our stockholders of $281.7 million and $262.1 million, respectively.

In March 2020 and September 2019, we amended our Credit Agreement dated May 29, 2018, to, among other things, reduce the margin added to the interest rate on revolving loans under the Credit Agreement and amend certain negative covenants, including covenants that restrict our and our subsidiaries’ ability to, among other things, incur subsidiary indebtedness, grant liens and enter into certain restrictive agreements. The amendments also allow us the option to factor receivables and certain related assets. The amendments lowered the Revolving Credit Facility thereunder to $3.57 billion from $3.60 billion.

The Credit Agreement provides for a revolving loan facility in an aggregate principal amount of approximately $3.57 billion, with a $250.0 million foreign currency sublimit, a $50.0 million letter of credit sublimit and a $25.0 million swingline loan sublimit. The Credit Agreement also provides for the Term Loan Facility. The Revolving Credit Facility consists of $3.57 billion of revolving loan commitments (the "2023 Revolving Loans") that terminate on May 18, 2023 (the "2023 Maturity Date").  The 2023 Revolving Loans bear interest, at our option, at the base rate plus a spread of 0.00% to 0.75% or an adjusted LIBOR rate plus a spread of 1.00% to 1.75%, in each case, with such spread being determined based on the consolidated senior leverage ratio for the preceding four fiscal quarter period. At December 31, 2020, we had $2.36 billion of outstanding borrowings under the Revolving Credit Facility compared to $2.39 billion at March 31, 2020. During the first nine months of fiscal 2021, we used borrowings under our Revolving Credit Facility and proceeds from the issuance of our 0.972% 2024 Notes to repay all amounts outstanding under our Term Loan Facility. See Note 6 of the notes to our condensed consolidated financial statements for more information regarding our Credit Agreement.

The enactment of the TCJA imposed a tax on all previously untaxed earnings of non-U.S. subsidiaries of U.S. corporations. Due to this change, the jurisdiction in which our cash is at any given point in time no longer has a significant impact on our liquidity.  Future distributions of a significant portion of our non-U.S. assets to the U.S. will no longer be subject to U.S. federal taxation.  We intend to invest substantially all of our foreign subsidiary earnings, as well as our capital in our foreign

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subsidiaries, indefinitely outside of the U.S. in those jurisdictions in which we would incur significant, additional costs upon repatriation of such amounts.

We enter into derivative transactions from time to time in an attempt to reduce our exposure to currency rate fluctuations.  Although none of the countries in which we conduct significant foreign operations has had a highly inflationary economy in the last five years, there is no assurance that inflation rates or fluctuations in foreign currency rates in countries where we conduct operations will not adversely affect our operating results in the future.  At December 31, 2020, we had no foreign currency forward contracts outstanding.

There were no repurchases of common stock during the first nine months of fiscal 2021. As of December 31, 2020, we held approximately 11.5 million shares as treasury shares.

On October 28, 2002, we announced that our Board of Directors had approved and instituted a quarterly cash dividend on our common stock.  A quarterly cash dividend of $0.3685 per share was paid on December 4, 2020 in the aggregate amount of $96.0 million.  A quarterly dividend of $0.39 per share was declared on February 4, 2021 and will be paid on March 8, 2021 to stockholders of record as of February 22, 2021. We expect the aggregate cash dividend for March 2021 to be approximately $105.0 million. Our Board is free to change our dividend practices at any time and to increase or decrease the dividend paid, or not to pay a dividend on our common stock on the basis of our results of operations, financial condition, cash requirements and future prospects, and other factors deemed relevant by our Board.  Our current intent is to provide for ongoing quarterly cash dividends depending upon market conditions, our results of operations, and potential changes in tax laws.

We believe that our existing sources of liquidity combined with cash generated from operations and borrowings under our Revolving Credit Facility will be sufficient to meet our currently anticipated cash requirements for at least the next 12 months. However, the semiconductor industry is capital intensive.  In order to remain competitive, we must constantly evaluate the need to make significant investments in capital equipment for both production and research and development.  We may increase our borrowings under our Revolving Credit Facility or seek additional equity or debt financing from time to time to maintain or expand our wafer fabrication and product assembly and test facilities, for cash dividends, for share repurchases or for acquisitions or other purposes.  The timing and amount of any such financing requirements will depend on a number of factors, including our level of dividend payments, changes in tax laws and regulations regarding the repatriation of offshore cash (including the impact of the TCJA), demand for our products, changes in industry conditions, product mix, competitive factors and our ability to identify suitable acquisition candidates.  We may from time to time seek to refinance certain of our outstanding notes or Convertible Debt through issuances of new notes or convertible debt or through exchange transactions. Such issuances or exchanges, if any, will depend on prevailing market conditions, our ability to negotiate acceptable terms, our liquidity position and other factors. There can be no assurance that any financing will be available on acceptable terms due to unfavorable market conditions resulting from the COVID-19 pandemic or other factors, and any additional equity financing would result in incremental ownership dilution to our existing stockholders.

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Contractual Obligations

The following table summarizes our significant contractual obligations for the remainder of fiscal 2021 and thereafter, and the effect such obligations are expected to have on our liquidity and cash flows in future periods (in millions):

	Payments Due by Fiscal Year Ending March 31,
	Total		2021		2022 - 2023		2024 - 2025		Thereafter
Operating lease obligations	$	210.9	$	15.7	$	78.9	$	39.1	$	77.2
Capital purchase obligations (1)	96.8		55.0		41.8		—		—
Other purchase obligations and commitments (2)	171.3		125.6		45.4		0.3		—
Revolving Credit Facility (3)	2,463.4		11.2		89.6		2,362.6		—
3.922% 2021 Notes (4)	1,019.6		—		1,019.6		—		—
4.333% 2023 Notes (5)	1,108.4		—		86.7		1,021.7		—
2.670% 2023 Notes (6)	1,080.2		13.4		53.4		1,013.4		—
0.972% 2024 Notes (7)	1,443.1		2.3		27.2		1,413.6		—
4.250% 2025 Notes (8)	1,455.0		25.5		102.0		102.0		1,225.5
2015 Senior Convertible Debt (9)	238.6		1.8		7.2		229.6		—
2017 Senior Convertible Debt (10)	503.7		3.7		14.8		14.8		470.4
2020 Senior Convertible Debt (11)	668.9		—		1.7		667.2		—
2017 Junior Convertible Debt (12)	381.9		3.1		12.5		12.5		353.8
Pension obligations (13)	21.1		0.3		3.3		4.6		12.9
Transition tax obligation (14)	220.6		—		46.4		101.6		72.6
Total contractual obligations (15)	$	11,083.5	$	257.6	$	1,630.5	$	6,983.0	$	2,212.4

(1)Capital purchase obligations represent commitments for construction or purchases of property, plant and equipment.  These obligations were not recorded as liabilities on our balance sheet as of December 31, 2020, as we have not yet received the related goods or taken title to the property.

(2)Other purchase obligations and commitments include payments due under various types of licenses and outstanding purchase commitments with our wafer foundries.

(3)For purposes of this table, we have assumed that the principal of our 2023 revolving loans outstanding at December 31, 2020 will be paid on May 18, 2023, which is the maturity date of such borrowings.

(4)The 3.922% 2021 Notes mature on June 1, 2021.

(5)The 4.333% 2023 Notes mature on June 1, 2023.

(6)The 2.670% 2023 Notes mature on September 1, 2023.

(7)The 0.972% 2024 Notes mature on February 15, 2024.

(8)The 4.250% 2025 Notes mature on September 1, 2025.

(9)For purposes of this table, we have assumed that the principal of our 2015 Senior Convertible Debt will be paid on February 15, 2025, which is the maturity date of such debt.

(10)For purposes of this table, we have assumed that the principal of our 2017 Senior Convertible Debt will be paid on February 15, 2027, which is the maturity date of such debt.

(11)For purposes of this table, we have assumed that the principal of our 2020 Senior Convertible Debt will be paid on November 15, 2024, which is the maturity date of such debt.

(12)For purposes of this table, we have assumed that the principal of our 2017 Junior Convertible Debt will be paid on February 15, 2037, which is the maturity date of such debt.

(13)For purposes of this table, pension obligations due in more than 5 years represent the expected pension payments from 2026 through 2030. It excludes pension obligations subsequent to 2030.

(14)Our total transition tax payment is expected to be approximately $290.3 million. This tax is payable over a period of eight years, with 8% of the transition tax payable each year for fiscal 2019 through fiscal 2023, and 15%, 20%, and 25%, respectively, payable during fiscal 2024, 2025, and 2026.

(15)The contractual obligations do not include amounts related to uncertain tax positions because reasonable estimates cannot be made.

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Purchase orders or contracts for the purchase of raw materials and other goods and services, with the exception of commitments to our wafer foundries, are not included in the table above.  We are not able to determine the aggregate amount of such purchase orders that represent contractual obligations, as purchase orders may represent authorizations to purchase rather than binding agreements.  For the purpose of this table, contractual obligations for the purchase of goods or services are defined as agreements that are enforceable and legally binding on us and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction.  Our purchase orders are based on our current manufacturing needs and are fulfilled by our vendors with short time horizons.  We do not have significant agreements for the purchase of raw materials or other goods specifying minimum quantities or set prices that exceed our expected requirements for three months.  We also enter into contracts for outsourced services; however, the obligations under these contracts were not significant and the contracts generally contain clauses allowing for cancellation without significant penalty.

The expected timing of payment of the obligations discussed above is estimated based on current information.  Timing of payments and actual amounts paid may be different depending on the time of receipt of goods or services or changes to agreed-upon amounts for some obligations.

Off-Balance Sheet Arrangements (Including Guarantees)

As of December 31, 2020, we are not involved in any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K with the exception of standby letters of credit or other guarantee instruments to certain parties as required for certain transactions initiated by us or our subsidiaries. We have not recorded any liability in connection with these guarantee arrangements. Based on historical experience and information currently available, we believe we will not be required to make any payments under these guarantee arrangements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As of December 31, 2020, our long-term debt totaled $9.58 billion. We have no interest rate exposure to rate changes on our fixed rate debt, which totaled $7.22 billion as of December 31, 2020. We do have interest rate exposure with respect to the $2.36 billion balance of our variable interest rate debt outstanding as of December 31, 2020. A 50 basis point increase in interest rates would impact our expected annual interest expense for the next 12 months by approximately $11.8 million.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, as required by paragraph (b) of Rule 13a-15 or Rule 15d-15 under the Exchange Act, we evaluated under the supervision of our Chief Executive Officer and our Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Exchange Act).  Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures were effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and (ii) is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.  Our disclosure controls and procedures are designed to provide reasonable assurance that such information is accumulated and communicated to our management.  Our disclosure controls and procedures include components of our internal control over financial reporting.  Management's assessment of the effectiveness of our internal control over financial reporting is expressed at the level of reasonable assurance because a control system, no matter how well designed and operated, can provide only reasonable, but not absolute, assurance that the control system's objectives will be met.

Changes in Internal Control over Financial Reporting

During the three months ended December 31, 2020, there was no change in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rule 13a-15 or Rule 15d-15 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II.  OTHER INFORMATION

Item 1. Legal Proceedings

Refer to Note 10 to our condensed consolidated financial statements for information regarding legal proceedings.

Item 1A. Risk Factors

When evaluating Microchip and its business, you should give careful consideration to the factors below, as well as the information provided elsewhere in this Form 10-Q and in other filings we make with the Securities and Exchange Commission. 

Risk Factor Summary

Risks Related to Our Business, Operations, and Industry

•impact of global economic conditions on our operating results, net sales and profitability;

•impact of economic conditions on the financial viability of our licensees, customers, distributors, or suppliers;

•impact of the COVID-19 pandemic, increased tariffs or other factors affecting our suppliers;

•dependence on foreign sales and operations, which exposes us to foreign political and economic risks;

•limited visibility to product shipments;

•dependency on wafer foundries and other contractors by our licensees and ourselves;

•intense competition in the markets we serve, leading to pricing pressures, reduced sales or market share;

•ineffective utilization of our manufacturing capacity or failure to maintain manufacturing yields;

•impact of seasonality and wide fluctuations of supply and demand in the industry;

•dependency on distributors;

•ability to introduce new products on a timely basis;

•business interruptions to operations or that of key vendors, licensees or customers;

•technology licensing business exposes us to various risks;

•reliance on sales into governmental projects;

•risks related to grants from governments, agencies and research organizations;

•future acquisitions or divestitures;

•future impairments to goodwill or intangible assets;

•our failure to maintain proper and effective internal control and remediate future control deficiencies;

•customer demands to implement business practices that are more stringent than legal requirements;

•ability to attract and retain qualified personnel; and

•the occurrence of events for which we are self-insured, or which exceed our insurance limits.

Risks Related to Cybersecurity, Intellectual Property, and Litigation

•attacks on our IT systems, interruptions in our IT systems, or improper handling of data;

•risks related to legal proceedings, investigations or claims;

•risks related to contractual relationships with our customers; and

•protecting our intellectual property.

Risks Related to Taxation, Laws and Regulations

•impact of new accounting pronouncements or changes in existing accounting standards and practices;

•fines, restrictions or delay in our ability to export products, or increase costs associated with the manufacture or transfer of products;

•outcome of future examinations of our income tax returns;

•exposure to greater than anticipated income tax liabilities, changes in or the interpretation of tax rules and regulations (including the TCJA) or unfavorable assessments from tax audits;

•impact of the legislative and policy changes implemented by the new administration;

•impact of stringent environmental, climate change, conflict-free minerals and other regulations or customer demands; and

•requirement to fund our foreign pension plans.

Risks Related to Capitalization and Financial Markets

•impact of various factors on our future trading price of our common stock;

•our ability to effectively manage current or future debt;

•our ability to generate sufficient cash flows or obtain access to external financing;

•impact of conversion of our convertible debt on the ownership interest of our existing stockholders; and

•fluctuations in foreign currency exchange rates.

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Risks Related to Our Business, Operations, and Industry

Our operating results are impacted by global economic conditions and may fluctuate in the future due to a number of factors that could reduce our net sales and profitability.

Our operating results are affected by a wide variety of factors that could reduce our net sales and profitability, many of which are beyond our control. Some of the factors that may affect our operating results include:

•general economic, industry, public health or political conditions in the U.S. or internationally, including ongoing uncertainty surrounding the COVID-19 pandemic and its implications;

•disruptions in our business, our supply chain or our customers' businesses due to public health concerns (including viral outbreaks such as COVID-19), cybersecurity incidents, terrorist activity, armed conflict, war, worldwide oil prices and supply, fires, natural disasters or disruptions in the transportation system;

•constrained availability from other electronic suppliers impacting our customers' ability to ship their products, which in turn may adversely impact our sales to those customers;

•changes in demand or market acceptance of our products and products of our customers, and market fluctuations in the industries into which such products are sold;

•our ability to adjust our factory capacity to respond to changes in customer demand;

•our ability to secure sufficient wafer foundry, assembly and testing capacity;

•availability of raw materials, supplies and equipment;

•the level of order cancellations or push-outs due to the impact of the COVID-19 pandemic or other factors;

•trade restrictions and increase in tariffs, including those on business in China, or focused on specific companies;

•the mix of inventory we hold and our ability to satisfy orders from our inventory;

•our ability to continue to realize the expected benefits of our past or future acquisitions;

•changes in utilization of our manufacturing capacity and fluctuations in manufacturing yields;

•changes or fluctuations in customer order patterns and seasonality;

•changes in tax regulations in countries in which we do business including the impact of the TCJA;

•new accounting pronouncements or changes in existing accounting standards and practices;

•levels of inventories held by our customers;

•risk of excess and obsolete inventories;

•competitive developments including pricing pressures;

•unauthorized copying of our products resulting in pricing pressure and loss of sales;

•our ability to successfully transition to more advanced process technologies to reduce manufacturing costs;

•the level of orders that are received and can be shipped in a quarter, including the impact of product lead times;

•the level of sell-through of our products through distribution;

•fluctuations in our mix of product sales;

•announcements of other significant acquisitions by us or our competitors;

•costs and outcomes of any current or future tax audits or any litigation, investigation or claims involving intellectual property, our Microsemi acquisition, customers or other issues;

•fluctuations in commodity or energy prices; and

•property damage or other losses, whether or not covered by insurance.

Period-to-period comparisons of our operating results are not necessarily meaningful and you should not rely upon any such comparisons as indications of our future performance. In future periods, our operating results may fall below our public guidance or the expectations of public market analysts and investors, which would likely have a negative effect on the price of our common stock. Uncertain global economic and public health conditions, such as the COVID-19 pandemic, have caused or may cause our operating results to fluctuate significantly and make comparisons between periods less meaningful.

Our operating results may be adversely impacted if economic conditions impact the financial viability of our licensees, customers, distributors, or suppliers.

We regularly review the financial performance of our licensees, customers, distributors and suppliers. Any downturn in global economic conditions, as a result of the COVID-19 pandemic or otherwise, may adversely impact their financial viability. The financial failure of a large licensee, customer or distributor, an important supplier, or a group thereof, could have an adverse impact on our operating results and could result in our inability to collect our accounts receivable balances, higher allowances for credit losses, and higher operating costs as a percentage of net sales.

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We may lose sales if suppliers of raw materials, components or equipment fail to meet our or our customers' needs or increase costs due to the impact of the COVID-19 pandemic, increased tariffs or other factors.

Our manufacturing operations require raw and processed materials and equipment that must meet exacting standards.  We generally have multiple sources for these supplies, but there may be a limited number of suppliers capable of meeting our standards.  The supplies necessary for our business could become more difficult to obtain as worldwide use of semiconductors increases. Additionally, consolidation in our supply chain due to mergers and acquisitions may reduce the number of suppliers or change our relationships with them. Also, the impact of the COVID-19 pandemic or the application of trade restrictions or tariffs by the U.S. or other countries may adversely impact the industry supply chain. For example, in 2019, the U.S. government increased tariffs on U.S. imports with China as their country of origin. Likewise, the China government increased tariffs on China imports with U.S. as their country of origin. We have taken steps to attempt to mitigate the costs of these tariffs on our business. Although these increases in tariffs did not significantly increase the operating costs of our business, they did, however, adversely impact demand for our products during fiscal 2020 and fiscal 2019. The additional tariffs imposed on components or equipment that we or our suppliers source from China will increase our costs and could have a material adverse impact on our operating results in the three months ending March 31, 2021 or future periods. We may also incur increases in manufacturing costs in mitigating the impact of tariffs on our operations. This could also impair sourcing flexibility. We have experienced supply shortages from time to time in the past, and on occasion our suppliers have told us they need more time to fill our orders or that they will no longer support certain equipment with updates or parts. In particular, we have recently experienced longer lead times for some assembly raw materials required for production purposes. An interruption of any materials or equipment sources, or the lack of supplier support for a particular piece of equipment, could harm our business.

Our customers may also be adversely affected by these same issues. The supplies and equipment necessary for their businesses could become more difficult to obtain for various reasons not limited to business interruptions of suppliers, consolidation in their supply chain, the impact of the COVID-19 pandemic, or trade restrictions or tariffs that impair sourcing flexibility or increase costs. If our customers are not able to produce their products, then their need for our products will decrease. Such interruptions of our customers’ businesses could harm our business.

We are highly dependent on foreign sales and operations, which exposes us to foreign political and economic risks.

Sales to foreign customers account for a substantial portion of our net sales. During the first nine months of fiscal 2021, approximately 76% of our net sales were made to foreign customers, including 22% in China and 16% in Taiwan. During fiscal 2020, approximately 78% of our net sales were made to foreign customers, including 21% in China and 15% in Taiwan.

A strong position in the Chinese market is a key component of our global growth strategy. Increased competition and, economic weakness in the China market has recently made it more difficult for us to achieve our desired sales volumes in China. In particular, as discussed in the risk factor above, the trade relationship between the U.S. and China remains challenging, economic conditions in China remain uncertain, and we are unable to predict whether such uncertainty will continue or worsen in future periods. Weakening of foreign markets could result in lower demand for our products, which could have a material adverse effect on our business, results of operations or financial conditions.

We purchase a substantial portion of our raw materials and equipment from foreign suppliers. In addition, we own product assembly and testing facilities, and finished goods warehouses near Bangkok, Thailand, which has experienced periods of political instability and severe flooding in the past. There can be no assurance that any future flooding or political instability in Thailand would not have a material adverse impact on our operations. We have a test facility in Calamba, Philippines. We use foundries and other foreign contractors for a significant portion of our assembly and testing and wafer fabrication requirements.

Our reliance on foreign operations, foreign suppliers, maintenance of substantially all of our finished goods inventory at foreign locations and significant foreign sales exposes us to foreign political and economic risks, including, but not limited to:

•political, social and economic instability due to the COVID-19 pandemic or other factors;

•trade restrictions and changes in tariffs;

•potentially adverse tax consequences;

•economic uncertainty in the worldwide markets served by us;

•import and export license requirements and restrictions;

•changes in laws related to taxes, environmental, health and safety, technical standards and consumer protection;

•currency fluctuations and foreign exchange regulations;

•difficulties in staffing and managing international operations;

•employment regulations;

•disruptions due to cybersecurity incidents;

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•disruptions in international transport or delivery;

•public health conditions (including viral outbreaks such as COVID-19); and

•difficulties in collecting receivables and longer payment cycles.

If any of these risks occur or are worse than we anticipate, our sales could decrease and our operating results could suffer, we could face an increase in the cost of components, production delays, business interruptions, delays in obtaining export licenses, tariffs and other restrictions, longer payment cycles, increased taxes, restrictions on the repatriation of funds and the burdens of complying with a variety of foreign laws, any of which could ultimately have a material adverse effect on our business. Further changes in trade policy, tariffs, additional taxes, or restrictions on supplies, equipment, and raw materials including rare earth minerals, may limit our ability to produce products, increase our selling and/or manufacturing costs, decrease margins, reduce the competitiveness of our products, or inhibit our ability to sell products or purchase necessary equipment and supplies, which could have a material adverse effect on our business, results of operations, or financial conditions.

We depend on orders that are received and shipped in the same quarter and have limited visibility to product shipments.

Our net sales in any given quarter depend upon a combination of shipments from backlog, and orders that are both received and shipped in the same quarter, which we call turns orders. We measure turns orders at the beginning of a quarter based on the orders needed to meet the shipment targets that we set entering the quarter. Historically, our ability to respond quickly to customer orders has been part of our competitive strategy, resulting in customers placing orders with relatively short delivery schedules. Shorter lead times generally mean that turns orders as a percentage of our business are relatively high in any particular quarter and reduce our visibility on future shipments. Turns orders correlate to overall semiconductor industry conditions and product lead times. Because turns orders are difficult to predict, especially in times of economic volatility such as those caused by the COVID-19 pandemic where customers may change order levels within the quarter, varying levels of turns orders make it more difficult to forecast net sales. As a significant portion of our products are manufactured at foundries, foundry lead times may affect our ability to satisfy certain turns orders. If we do not achieve a sufficient level of turns orders in a particular quarter relative to our revenue targets, our revenue and operating results will likely suffer.

We are dependent on wafer foundries and other contractors, as are our SuperFlash and other licensees.

We rely on outside wafer foundries for a significant portion of our wafer fabrication needs. Specifically, during the first nine months of fiscal 2021 and during fiscal 2020, approximately 61% of our net sales came from products produced at outside wafer foundries. We also use several contractors for a portion of the assembly and testing of our products. Specifically, during the first nine months of fiscal 2021, approximately 51% of our assembly requirements and 45% of our test requirements were performed by third party contractors, compared to approximately 55% and 46%, respectively, during fiscal 2020. Due to increased demand for our products, we have recently taken actions to increase our capacity allocation from our wafer fabrication, assembly and test subcontractors. We expect that our reliance on third party contractors may increase over time as our business grows.

Our use of third parties reduces our control over the subcontracted portions of our business. Our future operating results could suffer if a significant contractor were to experience production difficulties, insufficient capacity, decreased manufacturing, assembly and test yields, or increased costs due to disruptions from the COVID-19 pandemic, political upheaval or infrastructure disruption. If third parties do not timely deliver products or services in accordance with our quality standards, we may be unable to qualify alternate manufacturing sources in a timely manner on favorable terms, or at all. Additionally, these subcontractors could abandon processes that we need, or fail to adopt technologies that we desire to control costs. In such event, we could experience an interruption in production, an increase in manufacturing costs or a decline in product reliability, and our business and operating results could be adversely affected. Further, use of subcontractors increases the risks of misappropriation of our intellectual property.

Certain of our SuperFlash and other technology licensees rely on wafer foundries. If our licensees experienced disruption in supply at such foundries, this would reduce the revenue from our technology licensing business and would harm our operating results.

Intense competition in the markets we serve may lead to pricing pressures, reduced sales or reduced market share.

The semiconductor industry is intensely competitive and faces price erosion and rapid technological change. We compete with major domestic and international semiconductor companies, many of which have greater market recognition and substantially greater financial, technical, marketing, distribution and other resources than we do. The semiconductor industry has experienced significant consolidation in recent years which has resulted in several of our competitors becoming much larger

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in terms of revenue, product offerings and scale. We may be unable to compete successfully in the future, which could harm our business. Our ability to compete successfully depends on a number of factors, including, but not limited to:

•the relative impact of the COVID-19 pandemic on us relative to our competitors;

•changes in demand in the markets that we serve and the overall rate of growth or contraction of such markets, including but not limited to the automotive, personal computing and consumer electronics markets;

•our ability to obtain adequate foundry and assembly and test capacity and supplies at acceptable prices;

•the quality, performance, reliability, features, ease of use, pricing and diversity of our products;

•our success in designing and manufacturing new products including those implementing new technologies;

•the rate at which customers incorporate our products into their applications and the success of such applications;

•the rate at which the markets that we serve redesign and change their own products;

•our ability to ramp production and increase capacity, at our wafer fabrication and assembly and test facilities;

•product introductions by our competitors;

•the number, nature and success of our competitors in a given market;

•our ability to protect our products and processes by effective utilization of intellectual property rights;

•our ability to address the needs of our customers; and

•general market and economic conditions.

Historically, average selling prices in the semiconductor industry decrease over the life of a product. The average selling prices of our microcontroller, FPGA, and proprietary products in our analog product line have remained relatively constant, while average selling prices of our memory and non-proprietary products in our analog product line have declined over time. The overall average selling price of our products is affected by these trends; however, variations in our product and geographic mix of sales can cause wider fluctuations in our overall average selling price in any given period.

We have experienced, and expect to continue to experience, modest pricing declines in certain of our more mature proprietary product lines, primarily due to competitive conditions. We have moderated average selling price declines in many of our proprietary product lines by introducing new products with more features and higher prices. However, we may not be able to do so in the future. We have experienced in the past, and expect to continue to experience, competitive pricing pressures in our memory and non-proprietary products in our analog product line. We may be unable to maintain average selling prices due to increased pricing pressure, which could adversely impact our operating results.

Our operating results will suffer if we ineffectively utilize our manufacturing capacity or fail to maintain manufacturing yields.

Integrated circuits manufacturing processes are complex and sensitive to many factors, including contaminants in the manufacturing environment or materials used, the performance of our personnel and equipment, and other quality issues. As is typical in the industry, we have from time to time experienced lower than anticipated manufacturing yields. Our operating results will suffer if we are unable to maintain yields at or above approximately the current levels. This could include delays in the recognition of revenue, loss of revenue, and penalties for failure to meet shipment deadlines. Our operating results are adversely affected when we operate below optimal capacity. In the first nine months of fiscal 2021 and fiscal 2020, we operated at below normal capacity levels resulting in unabsorbed capacity charges of $29.8 million and $33.3 million, respectively.

Our operating results are impacted by seasonality and wide fluctuations of supply and demand in the industry.

The semiconductor industry is characterized by seasonality and wide fluctuations of supply and demand.  Historically, since a significant portion of our revenue is from consumer markets and international sales, our business generates stronger revenues in the first half and comparatively weaker revenues in the second half of our fiscal year. However, broad fluctuations in our business, changes in semiconductor industry and global economic conditions (including the impact of the COVID-19 pandemic or trade tensions) and our acquisition activity (including our acquisition of Microsemi) have had and can have a more significant impact on our results than seasonality. In periods when broad fluctuations, changes in business conditions or acquisitions occur, it is difficult to assess the impact of seasonality on our business. The semiconductor industry has had significant economic downturns, characterized by diminished product demand and production over-capacity. We have sought to reduce our exposure to this industry cyclicality by selling proprietary products, that cannot be quickly replaced, to a geographically diverse customer base across a broad range of market segments. However, we have experienced substantial period-to-period fluctuations in operating results and expect, in the future, to experience period-to-period fluctuations in operating results due to general industry or economic conditions.

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Our business is dependent on distributors to service our end customers.

Sales to distributors accounted for approximately 51% of our net sales in the first nine months of fiscal 2021 and approximately 50% of our net sales in fiscal 2020. We do not have long-term purchase agreements with our distributors, and we and our distributors may each terminate our relationship with little or no advance notice.

Future adverse conditions in the U.S. or global economies (including the impact of the COVID-19 pandemic) or credit markets could materially impact distributor operations. Any deterioration in the financial condition, or disruption in the operations of our distributors, could adversely impact the flow of our products to our end customers and adversely impact our results of operation. In addition, during an industry or economic downturn, there may be an oversupply and decrease in demand for our products, which could reduce our net sales in a given period and increase inventory returns. Violations of the Foreign Corrupt Practices Act, or similar, by our distributors could have a material adverse impact on our business.

Our success depends on our ability to introduce new products on a timely basis.

Our future operating results depend on our ability to develop and timely introduce new products that compete effectively on the basis of price and performance and which address customer requirements. The success of our new product introductions depends on various factors, including, but not limited to:

•effective new product selection;

•timely completion and introduction of new product designs;

•procurement of licenses for intellectual property rights from third parties under commercially reasonable terms;

•timely filing and protection of intellectual property rights for new product designs;

•availability of development and support tools and collateral literature that make complex new products easy for engineers to understand and use; and

•market acceptance of our customers' end products.

Because our products are complex, we have experienced delays from time to time in completing new product development. New products may not receive or maintain substantial market acceptance.  We may be unable to timely design, develop and introduce competitive products, which could adversely impact our future operating results.

Our success also depends upon our ability to develop and implement new design and process technologies. Semiconductor design and process technologies are subject to rapid technological change and require significant R&D expenditures. We and others in the industry have, from time to time, experienced difficulties in transitioning to advanced process technologies and have suffered reduced manufacturing yields or delays in product deliveries. Our future operating results could be adversely affected if any transition to future process technologies is substantially delayed or inefficiently implemented.

Business interruptions to our operations or those of our key vendors, licensees or customers could harm our business.

Operations at any of our facilities, at the facilities of any of our wafer fabrication or assembly and test subcontractors, or at any of our significant vendors, licensees or customers may be disrupted due to public health concerns (including outbreaks such as COVID-19), work stoppages, power loss, insufficient water, cyber attacks, computer network compromises, incidents of terrorism or security risk, political instability, telecommunications, transportation or other infrastructure failure, radioactive contamination, or fire, earthquake, floods, droughts, volcanic eruptions or other natural disasters. We have taken steps to mitigate the impact of some of these events should they occur; however, we cannot be certain that we will avoid a significant impact on our business in the event of a business interruption. For example, in the first quarter of fiscal 2021, restrictions on travel adversely impacted our manufacturing operations in the Philippines and our subcontractors' manufacturing operations in Malaysia and China. Similar challenges arose for our logistics service providers, which adversely impacted their ability to ship product to our customers. The pandemic could adversely impact our business in the fiscal quarter ended March 31, 2021 and could continue to adversely impact our business in future periods if the impact of COVID-19 increases. In the future, local governments could require us to temporarily reduce production further or cease operations at any of our facilities and we could experience constraints in fulfilling customer orders.

Additionally, operations at our customers and licensees may be disrupted for a number of reasons. In April and May 2020, we received a greater number of order cancellations and requests by our customers to reschedule deliveries to future dates. Some customers requested order cancellations within our firm order window and claimed applicability of force majeure clauses. Likewise, if our licensees are unable to manufacture and ship products incorporating our technology, or if there is a decrease in product demand due to a business disruption, our royalty revenue may decline.

Also, Thailand has experienced periods of severe flooding in recent years. While our facilities in Thailand have continued

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to operate normally, there can be no assurance that future flooding in Thailand would not have a material adverse impact on our operations. If operations at any of our facilities, or our subcontractors' facilities are interrupted, we may not be able to timely shift production to other facilities, and we may need to spend significant amounts to repair or replace our facilities and equipment.  Business interruptions would likely cause delays in shipments of products to our customers, and alternate sources for production may be unavailable on acceptable terms. This could result in reduced revenues, cancellation of orders, or loss of customers. Although we maintain business interruption insurance, such insurance will likely not compensate us for any losses or damages, and business interruptions could significantly harm our business.

Our technology licensing business exposes us to various risks.

Our technology licensing business is based on our SuperFlash and other technologies. The success of our licensing business depends on the continued market acceptance of these technologies and on our ability to further develop such technologies and to introduce new technologies. To be successful, any such technology must be able to be repeatably implemented by licensees, provide satisfactory yield rates, address licensee and customer requirements, and perform competitively. The success of our technology licensing business depends on various other factors, including, but not limited to:

•proper identification of licensee requirements;

•timely development and introduction of new or enhanced technology;

•our ability to protect and enforce our intellectual property rights for our licensed technology;

•our ability to limit our liability and indemnification obligations to licensees;

•availability of development and support services to assist licensees in their design and manufacture of products;

•availability of foundry licensees with sufficient capacity to support OEM production; and

•market acceptance of our customers' end products.

Because our licensed technologies are complex, there may be delays from time to time in developing and enhancing such technologies. There can be no assurance that our existing or any enhanced or new technology will achieve or maintain substantial market acceptance. Our licensees may experience disruptions in production or reduced production levels which would adversely affect the revenue that we receive. Our technology license agreements generally include a clause that indemnifies the licensee against liability and damages (including legal defense costs) arising from certain intellectual property matters. We could be exposed to substantial liability for claims or damages related to intellectual property matters or indemnification claims. Any claim could result in significant legal fees and require significant attention from our management. These issues may adversely impact the success of our licensing business and adversely affect our future operating results.

Reliance on sales into governmental projects could have a material adverse effect on our results of operations.

A significant portion of the sales of Microsemi, which we acquired in May 2018, are from or are derived from government agencies or customers who sell to U.S. government agencies.  Such sales are subject to uncertainties regarding governmental spending levels, spending priorities, regulatory and policy changes.  Future sales into U.S. government projects are subject to uncertain government appropriations and national defense policies and priorities, including the budgetary process, changes in the timing and spending priorities, the impact of any past or future government shutdowns, contract terminations or renegotiations, future sequestrations, or the impact of the COVID-19 pandemic.  For example, as a result of the COVID-19 pandemic, we have experienced suspensions and stop work orders for some of our subcontracts. Although such actions have not yet had a material adverse impact on our business, there can be no assurance as to the future costs or implications of such actions. Sales into government projects are also subject to uncertainties related to monetary, regulatory, tax and trade policies implemented by current or future administrations or by the U.S. Congress.

In the past, Microsemi has experienced delays and reductions in appropriations on programs that included its products. For example, in 2018 there were two federal government shutdowns. Further delays, reductions in or terminations of government contracts or subcontracts, including those caused by any past or future shutdown of the U.S. federal government, could materially and adversely affect our operating results. If the U.S. government fails to complete its annual budget process or to provide for a continuing resolution to fund government operations, another federal government shutdown may occur, during which we may experience further delays, reductions in or terminations of government contracts or subcontracts, which could materially and adversely affect our operating results. While we generally function as a subcontractor in these type of transactions, further changes in U.S. government procurement regulations and practices, particularly surrounding initiatives to reduce costs or increase compliance obligations (such as the Cybersecurity Maturity Model Certification), may adversely impact the contracting environment and our operating results.

The U.S. government and its contractors may terminate their contracts with us at any time. For example, in 2014, the U.S. government terminated a $75 million contract with Microsemi.  Uncertainty in government spending and termination of contracts for government related projects could have a material adverse impact on the revenue from our Microsemi acquisition. 

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Our contracts with U.S. governmental agencies or prime customers requires us to comply with the contract terms, and governmental regulations, particularly for our facilities, systems and personnel that service such customers.  Complying with these regulations, including audit requirements, requires that we devote significant resources to such matters in terms of training, personnel, information technology and facilities.  Any failure to comply with these requirements may result in fines and penalties and loss of current or future business that may materially and adversely affect our operating results.

From time to time we receive grants from governments, agencies and research organizations. If we are unable to comply with the terms of those grants, we may not be able to receive or recognize grant benefits or we may be required to repay grant benefits and recognize related charges, which would adversely affect our operating results and financial position.

From time to time, we receive economic incentive grants and allowances from European governments, agencies and research organizations targeted at increasing employment at specific locations. The subsidy grant agreements typically contain economic incentive, headcount, capital and research and development expenditures and other covenants that must be met to receive and retain grant benefits, and these programs can be subjected to periodic review by the relevant governments. Noncompliance with the conditions of the grants could result in our forfeiture of all or a portion of any future amounts to be received, as well as the repayment of all or a portion of amounts received to date.

We may not fully realize the anticipated benefits of our completed or future acquisitions or divestitures.

We have acquired, and expect in the future to acquire, additional businesses that we believe will complement or augment our existing businesses. In May 2018, we acquired Microsemi, which was our largest and most complex acquisition ever. Integration of our acquisitions is complex and may be costly and time consuming and include unanticipated issues, expenses and liabilities. We may not successfully or profitably integrate, operate, maintain and manage any newly acquired operations or employees. We may not be able to maintain uniform standards, procedures and policies. We may not realize the expected synergies and cost savings from the integration. There may be increased risk due to integrating financial reporting and internal control systems. It may be difficult to develop, manufacture and market the products of a newly acquired company, or grow the business at the rate we anticipate. Following an acquisition, we may not achieve the revenue or net income levels that justify the acquisition. We may suffer loss of key employees, customers and strategic partners of acquired companies and it may be difficult to implement our corporate culture at acquired companies. We have been and may in the future be subject to claims from terminated employees, shareholders of Microchip or the acquired companies and other third parties related to the transaction. In particular, in connection with our Microsemi and Atmel acquisitions, we became involved with third-party claims, litigation, governmental investigations and disputes related to such businesses and transactions. See Note 10 to our condensed consolidated financial statements for information regarding such matters. Acquisitions may also result in charges (such as acquisition-related expenses, write-offs, restructuring charges, or future impairment of goodwill), contingent liabilities, adverse tax consequences, additional share-based compensation expense and other charges that adversely affect our operating results. To fund our acquisition of Microsemi, we used a significant portion of our cash balances and incurred approximately $8.10 billion of additional debt. We may fund future acquisitions of new businesses or strategic alliances by utilizing cash, borrowings under our Revolving Credit Facility, raising debt, issuing shares of our common stock, or other mechanisms.

Further, if we decide to divest assets or a business, it may be difficult to find or complete divestiture opportunities or alternative exit strategies, which may include site closures, timely or on acceptable terms. These circumstances could delay the achievement of our strategic objectives or cause us to incur additional expenses with respect to the desired divestiture, or the price or terms of the divestiture may be less favorable than we had anticipated. Even following a divestiture or other exit strategy, we may have certain continuing obligations to former employees, customers, vendors, landlords or other third parties. We may also have continuing liabilities related to former employees, assets or businesses. Such obligations may have a material adverse impact on our results of operations and financial condition.

In addition to acquisitions, we have in the past, and expect in the future, to enter into joint development agreements or other strategic relationships with other companies. These transactions are subject to a number of risks similar to those we face with our acquisitions including our ability to realize the expected benefits of any such transaction, to successfully market and sell products resulting from such transactions or to successfully integrate any technology developed through such transactions.

As a result of our acquisition activity, our goodwill and intangible assets have increased significantly in recent years and we may in the future incur impairments to goodwill or intangible assets.

When we acquire a business, a substantial portion of the purchase price of the acquisition is allocated to goodwill and other identifiable intangible assets. The amount of the purchase price which is allocated to goodwill is determined by the excess of the purchase price over the net identifiable assets acquired. As of December 31, 2020, we had goodwill of $6.67 billion and net intangible assets of $5.03 billion. In connection with the completion of our acquisition of Microsemi in May 2018, our balance

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of goodwill and intangible assets increased significantly. We review our indefinite-lived intangible assets, including goodwill, for impairment annually in the fourth fiscal quarter or whenever events or changes in circumstances indicate that the carrying amount of those assets is more likely than not impaired.  Factors that may be considered in assessing whether goodwill or intangible assets may be impaired include a decline in our stock price or market capitalization, reduced estimates of future cash flows and slower growth rates in our industry.  Our valuation methodology for assessing impairment requires management to make judgments and assumptions based on experience and to rely heavily on projections of future operating performance.  Because we operate in highly competitive environments, projections of our future operating results and cash flows may vary significantly from our actual results.  No goodwill impairment charges were recorded in the first nine months of fiscal 2021 or fiscal 2020.  No intangible asset impairment charges were recorded in the first nine months of fiscal 2021 compared to $2.2 million in fiscal 2020. If in future periods, we determine that our goodwill or intangible assets are impaired, we will be required to write down these assets which would have a negative effect on our condensed consolidated financial statements.

If we fail to maintain proper and effective internal control and remediate future control deficiencies, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and investors' views of us.

As discussed in Item 9A “Controls and Procedures” in our annual report on Form 10-K for the fiscal year ended March 31, 2019, we identified a material weakness in our internal controls related to accounting for income taxes and we also identified a material weakness in our internal controls related to IT system access. Although such material weaknesses were remediated in fiscal 2020, there can be no assurance that similar control issues will not be identified in the future. If we cannot remediate future material weaknesses or significant deficiencies in a timely manner, or if we identify additional control deficiencies that individually or together constitute significant deficiencies or material weaknesses, our ability to accurately record, process, and report financial information and our ability to prepare financial statements within required time periods, could be adversely affected. Failure to maintain effective internal controls could result in violations of applicable securities laws, stock exchange listing requirements, and the covenants under our debt agreements, subject us to litigation and investigations, negatively affect investor confidence in our financial statements, and adversely impact our stock price and ability to access capital markets.

Ensuring that we have adequate internal financial and accounting controls and procedures so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be re-evaluated frequently. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with United States generally accepted accounting principles. We are required to comply with Section 404 of the Sarbanes-Oxley Act of 2002 which requires an annual management assessment of the effectiveness of our internal control over financial reporting and a report by our independent auditors. In addition to the identified material weaknesses related to accounting for income taxes and to IT system access, which were remediated as of March 31, 2020, we have from time to time identified other significant deficiencies. If we fail to remediate any future material weaknesses or significant deficiencies or to maintain proper and effective internal control over financial reporting in the future, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, harm our ability to operate our business and reduce the trading price of our stock.

Customer demands for us to implement business practices that are more stringent than legal requirements may reduce our revenue opportunities or cause us to incur higher costs.

Some of our customers require that we implement practices that are more stringent than those required by applicable laws with respect to labor requirements, the materials contained in our products, energy efficiency, environmental matters or other items. To comply with such requirements, we also require our suppliers to adopt such practices. Our suppliers may in the future refuse to implement these practices, or may charge us more for complying with them. If certain of our suppliers refuse to implement the practices, we may be forced to source from alternate suppliers. The cost to implement such practices may cause us to incur higher costs and reduce our profitability, and if we do not implement such practices, such customers may disqualify us as a supplier, resulting in decreased revenue opportunities. Developing, enforcing, and auditing customer-requested practices at our own sites and in our supply chain will increase our costs and may require more personnel.

We must attract and retain qualified personnel to be successful, and competition for qualified personnel can be intense.

Our success depends upon our personnel. The loss of or inability to attract key personnel, or the loss of or inability to attract sufficient numbers of non-key personnel could harm our business. We have no employment agreements with any member of our senior management team. 

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The occurrence of events for which we are self-insured, or which exceed our insurance limits, may adversely affect our profitability and liquidity.

We have insurance coverage related to many different types of risk; however, we self-insure for some potentially significant risks and obligations. In certain cases, we believe that it is more cost effective for us to self-insure than to pay the high premium costs. The risks and exposures that we self-insure include, but are not limited to, employee health matters, certain property, product defects, cybersecurity matters, employment risks, environmental matters, political risks, and intellectual property matters. Should there be a loss or adverse judgment in an area for which we are self-insured, then our financial condition, results of operations and liquidity may be adversely affected.

Risks Related to Cybersecurity, Intellectual Property, and Litigation

We continue to be the target of attacks on our IT systems and interruptions in our IT systems, unauthorized access to our IT systems, or improper handling of data, could adversely affect our business.

We rely on the uninterrupted operation of complex IT systems and networks to operate our business.  Any significant disruption to our systems or networks, including, but not limited to, new system implementations, computer viruses, security breaches, facility issues, natural disasters, terrorism, war, telecommunication failures or energy blackouts could have a material adverse impact on our business, operations, sales and operating results.  Such disruption could result in an unauthorized release of our, our suppliers’ or our customers’ intellectual property or confidential or proprietary information, or the release of personal data. Any release of such information could harm our business or competitive position, result in a loss of customer confidence, and cause us to incur significant costs to remedy the damages. Any release of information or failure to properly manage the collection, handling, or disposal of such information may result in regulatory inquiries or penalties, enforcement actions, remediation obligations, claims for damages, litigation, and other sanctions.

From time to time, we have experienced verifiable attacks on our data, network compromises, attempts to breach our security and attempts to introduce malicious software into our IT systems. For example, in fiscal 2019, we learned of an ongoing compromise of our computer networks by what is believed to be sophisticated hackers. We engaged experienced legal counsel and a leading forensic investigatory firm with experience in such matters. We took various steps to identify malicious activity on our network including a compromise of our network and, in May 2019, we began implementing a containment plan. We routinely evaluate the effectiveness of the containment mechanisms that were implemented and continue to implement additional measures from time to time. We have analyzed and continue to analyze the amount and content of the information that was compromised. We do not believe that this IT system compromise has had a material adverse effect on our business or resulted in any material damage to us. As a result of the IT system compromise, our management, including our chief executive officer and our chief financial officer, concluded that our internal controls related to IT system access were not effective resulting in a material weakness in our internal controls for fiscal 2019. Although this material weakness was remediated in fiscal 2020, there can be no assurance that similar control issues will not be identified in future periods.

Due to the types of products we sell and the significant amount of sales we make to government agencies or customers whose principal sales are to U.S. government agencies, we have experienced and expect continued attacks on our data, attempts to breach our security, network compromises and attempts to introduce malicious software into our IT systems. Were any future attacks to be successful, we may be unaware of the incident, its magnitude, or its effects until significant harm is done. In recent years, we have regularly implemented improvements to our protective measures which include, but are not limited to, the following: firewalls, endpoint detection and response software, patches, log monitors, event correlation tools, routine backups with offsite retention of storage media, system audits, dual factor identification, data partitioning and routine password modifications. As a result of the material weakness in our internal controls resulting from the IT systems compromise in 2019, we have taken remediation actions and implemented additional controls and we plan to continue to take actions to attempt to address evolving threats. However, recent system improvements have not been fully effective in preventing attacks on our data and breaches to our security, and there can be no assurance that any future system improvements will be effective in preventing attacks or breaches or limiting the damage from any future attacks or disruptions. Such system improvements have resulted in increased costs to us and any future improvements, attacks or disruptions could result in additional costs related to rebuilding our internal systems, defending litigation, providing notices to regulatory agencies or other third parties, responding to regulatory actions, or paying damages. Such attacks could have a material adverse impact on our business, operations and financial results.

Third-party service providers, such as wafer foundries, assembly and test contractors, distributors, credit card processors and other vendors have access to portions of our and our customers' data. In the event that these service providers do not properly safeguard the data that they hold, security breaches and loss of data could result. Any such loss of data could negatively impact our business, operations and financial results, as well as our relationship with our customers.

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We are exposed to various risks related to legal proceedings, investigations or claims.

We are currently, and in the future may be, involved in legal proceedings, investigations or claims regarding intellectual property rights, product failures, our Microsemi acquisition, contracts and other matters. As is typical in the semiconductor industry, we receive notifications from third parties from time to time who believe that we owe them indemnification or other obligations related to claims made against us, our direct or indirect customers, or our licensees. These legal proceedings and claims, even if meritless, have in the past and could in the future result in substantial costs to us. If we are unable to resolve or settle a matter, obtain necessary licenses on reasonable terms, reengineer products or processes to avoid infringement, provide a cost-effective remedy, or successfully prosecute or defend our position, we could incur uninsured liability in any of them, be required to take a charge to operations, be enjoined from selling a material portion of our products or using certain processes, suffer a reduction or elimination in the value of our inventories, and our business, financial condition or results of operations could be harmed.

It is also possible that from time to time we may be subject to claims related to the manufacture, performance, or use of our products. These claims may be due to injuries, economic damage or environmental exposures related to manufacturing, a product's nonconformance to our or our customer’s specifications, changes in our manufacturing processes, or unexpected customer system issues due to the integration of our products or insufficient design or testing by our customers. We could incur significant expenses related to such matters, including, but not limited to:

•costs related to writing off the value of our inventory of nonconforming products;

•recalling nonconforming products;

•providing support services, product replacements, or modifications to products and the defense of such claims;

•diversion of resources from other projects;

•lost revenue or a delay in the recognition of revenue due to cancellation of orders or unpaid receivables;

•customer imposed fines or penalties for failure to meet contractual requirements; and

•a requirement to pay damages or penalties.

Because the systems into which our products are integrated have a higher cost of goods than the products we sell, the expenses and damages we are asked to pay may be significantly higher than the revenue and profits we received. While we exclude consequential damages in our standard terms and conditions, certain of our contracts may not exclude such liabilities. Further, our ability to avoid such liabilities may be limited by law. We have liability insurance which covers certain damages arising out of product defects, but we do not expect that insurance will fully protect against such claims. Payments we may make in connection with these customer claims may adversely affect the results of our operations.

Further, we sell to customers in industries such as automotive, aerospace, defense, safety, security, and medical, where failure of the application could cause damage to property or persons. We may be subject to claims if our products, or the integration of our products, cause system failures. We will face increased exposure to claims if there are substantial increases in either the volume of our sales into these applications or the frequency of system failures integrating our products.

Our contractual relationships with our customers expose us to risks and liabilities.

We do not typically enter into long-term contracts with our non-distributor customers, and therefore we cannot be certain about future order levels from our customers. When we do enter into customer contracts, the contract is generally cancelable at the customer’s convenience. While we had approximately 113,000 customers, and our ten largest direct customers made up approximately 12% of our total revenue for the nine months ended December 31, 2020, and five of our top ten direct customers are contract manufacturers that perform manufacturing services for many customers, cancellation of customer contracts could have an adverse impact on our revenue and profits. For example, due to uncertainty related to the COVID-19 pandemic, we experienced an increase in order cancellations and requests to reschedule deliveries to future dates in the first quarter of fiscal 2021.

Certain customer contracts differ from our standard terms of sale. For some of the markets that we sell into, such as the automotive and personal computer markets, our customers may have negotiating leverage over us as a result of their market size. For example, under certain contracts we may commit to supply products on scheduled delivery dates, or extend our obligations for liabilities such as warranties or indemnification for quality issues or intellectual property infringement. If we are unable to supply the customer as contractually required, the customer may incur additional production costs, lost revenues due to delays in their manufacturing schedule, or quality-related issues. We may be liable for costs and damages associated with customer claims, and we may be obligated to defend the customer against claims of intellectual property infringement and pay associated legal fees. While we try to minimize the number of contracts which contain such provisions, manage the risks of such liabilities, and set caps on our liability exposure, sometimes we are unable to do so. In order to win important designs,

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avoid losing business to competitors, maintain existing business, or be permitted to bid on new business, we have, and may in the future, have to agree to uncapped liability for such items as intellectual property infringement or product failure. This exposes us to risk of liability far exceeding the purchase price of the products sold under such contracts, the lifetime revenues we receive under such contracts, or potential consequential damages. Further, where we do not have negotiated customer contracts, our customer's order terms may govern the transaction and contain terms unfavorable to us. These risks could result in a material adverse impact on our results of operations and financial condition.

Failure to adequately protect our intellectual property could result in lost revenue or market opportunities.

Our ability to obtain patents, licenses and other intellectual property rights covering our products and manufacturing processes is important for our success. To that end, we have acquired certain patents and licenses and intend to continue to seek patents on our technology and manufacturing processes. The process of seeking patent protection can be expensive, and patents may not be issued from currently pending or future applications. We may be subject to, or may initiate, interference proceedings in the U.S. Patent and Trademark Office, patent offices of a foreign country or U.S. or foreign courts, which can require significant financial resources. In addition, the laws of certain foreign countries do not protect our intellectual property rights to the same extent as the laws of the U.S. Infringement of our intellectual property rights by a third party could result in uncompensated lost market and revenue opportunities for us. Although we continue to aggressively defend and protect our intellectual property on a worldwide basis, there can be no assurance that we will be successful.

Risks Related to Taxation, Laws and Regulations

Our reported financial results may be adversely affected by new accounting pronouncements or changes in existing accounting standards and practices.

We prepare our financial statements in conformity with accounting principles generally accepted in the U.S. These accounting principles are subject to interpretation or changes by the FASB and the SEC. New accounting pronouncements and interpretations of accounting standards and practices have occurred in the past and are expected to occur in the future. New accounting pronouncements or a change in the interpretation of accounting standards or practices may have a significant effect on our reported financial results and may affect our reporting of transactions completed before the change is effective.

Regulatory authorities in jurisdictions into or from which we ship our products could levy fines, restrict or delay our ability to export products, or increase costs associated with the manufacture or transfer of products.

A significant portion of our sales require export and import activities. Our U.S.-manufactured products or products based on U.S. technology are subject to laws and regulations on international trade, including but not limited to the Foreign Corrupt Practices Act, EARs, International Traffic in Arms Regulations and trade sanctions against embargoed countries and denied entities. Licenses or license exceptions are required for the shipment of our products to certain countries. Our inability to timely obtain a license, for any reason, including a delay in license processing due to a federal government shutdown like that which occurred in 2018, could cause a delay in scheduled shipments which could have a material adverse impact on our revenue within the quarter of a shutdown, and in following quarters depending on the extent that license processing is delayed. Further, determination by a government that we have failed to comply with trade regulations or anti-bribery regulations can result in penalties which may include denial of export privileges, fines, penalties, and seizure of products, any of which could have a material adverse effect on our business, sales and earnings. A change in laws and regulations could restrict our ability to transfer product to previously permitted countries, customers, distributors or others. For example, in fiscal 2019, the U.S. Commerce Department banned U.S. companies from selling products or transferring technology to ZTE, a Chinese company, and certain subsidiaries. This ban was lifted in July 2018. In fiscal 2020, the U.S. Commerce Department banned U.S. companies from selling products or transferring technology to certain Chinese companies, including Huawei and certain subsidiaries. In fiscal 2020, the U.S. Federal Acquisition Regulation prohibited U.S. governmental agencies from buying equipment using covered telecommunications equipment as a substantial component or critical technology where the technology came from certain Chinese companies. On July 14, 2020, this was expanded to prohibit U.S. governmental agencies from entering into a contract with any company that uses covered telecommunications equipment whether or not the Chinese technology is related to the procurement. Effective June 2020, amendments to the EAR regarding prohibitions of sales of items with a “military end use” into China, Russia, and Venezuela, and elimination of an EAR License Exception, apply to more of our products than the previous regulations. Any of the foregoing changes could adversely impact our operational costs due to the administrative impacts of complying with these regulations, and may limit those with whom we conduct business. Any one or more of these sanctions, future sanctions, a change in laws or regulations, or a prohibition on shipment of our products or transfer of our technology to significant customers could have a material adverse effect on our business, financial condition and results of operations.

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The U.S. and other countries have levied tariffs and taxes on certain goods, implemented trade restrictions, and introduced national security protection policies. Trade tensions between the U.S. and China escalated from 2018 through 2020, including the U.S. increasing tariffs on Chinese origin goods, and China increasing tariffs on U.S. origin goods. Some of our products were adversely affected and are continuing to be affected by the increased tariffs. We took steps to mitigate the costs of these tariffs on our business by making adjustments in operations and supply. Although these tariff increases did not result in a material adverse impact on our operating costs in fiscal 2019 or fiscal 2020, they did reduce demand for our products during fiscal 2019 and fiscal 2020. Increased tariffs on our customers' products could impact their sales, and increased tariffs on our products in comparison to those of our competitors could each result in lower demand for our products.

Further changes in trade or national security protection policy, tariffs, additional taxes, restrictions on exports or other trade barriers, may limit our ability to produce products, increase our selling and/or manufacturing costs, decrease margins, reduce the competitiveness of our products, or reduce our ability to sell products, which could have a material adverse effect on our business, results of operations or financial conditions.

The outcome of future examinations of our income tax returns could have an adverse effect on our results of operations.

We are subject to examination of our U.S. and certain foreign income tax returns for fiscal 2007 and later. We regularly assess the likelihood of adverse outcomes of these examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that may result from the current examinations. There can be no assurance that the final determination of any of these or any future examinations will not have an adverse effect on our effective tax rates, financial position and results of operations.

Exposure to greater than anticipated income tax liabilities, changes in tax rules and regulations (including the TCJA), changes in the interpretation of tax rules and regulations, or unfavorable assessments from tax audits could affect our effective tax rates, financial condition and results of operations.

We are a U.S.-based multinational company subject to tax in many U.S. and foreign jurisdictions. Our income tax obligations could be affected by many factors, including changes to our operating structure, intercompany arrangements and tax planning strategies.

Our income tax expense is computed based on tax rates at the time of the respective financial period. Our future effective tax rates, financial condition and results from operations could be unfavorably affected by changes in the tax rates in jurisdictions where our income is earned, by changes in the tax rules and regulations or the interpretation of tax rules and regulations in the jurisdictions in which we do business or by changes in the valuation of our deferred tax assets.

Currently, a majority of our revenue is generated from customers located outside the U.S., and a substantial portion of our assets, including employees, are located outside of the U.S. The adoption of the TCJA significantly changed the taxation of U.S.-based multinational corporations, by, among other things, reducing the U.S. corporate income tax rate, adopting elements of a territorial tax system, assessing a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creating new taxes on certain foreign-sourced earnings. The TCJA is unclear in some respects and will require interpretations and implementing regulations by the IRS, as well as state tax authorities, and the legislation could be subject to potential amendments and technical corrections, any of which could lessen or increase certain adverse impacts of the legislation. A significant portion of our earnings are earned by our subsidiaries outside the U.S. Changes to the taxation of certain foreign earnings resulting from the TCJA, along with the state tax impact of these changes and potential future cash distributions, will likely have an adverse effect on our effective tax rate. Furthermore, changes to the taxation of undistributed foreign earnings could change our future plans regarding reinvestment of such earnings. The foregoing items could have a material adverse effect on our business, cash flow, results of operations or financial conditions.

The Organization for Economic Cooperation and Development has been working on a Base Erosion and Profit Shifting Project, and issued a report in 2015, an interim report in 2018, and is expected to continue to issue guidelines and proposals that may change aspects of the existing framework under which our tax obligations are determined in many of the countries where we do business. Similarly, the European Commission and several countries have issued proposals that would change aspects of the current tax framework under which we are taxed. These proposals include changes to the existing income tax framework, and proposals to change or impose new types of non-income taxes, including taxes based on a percentage of revenue.

Our business, financial condition and operating results may be adversely impacted by policies implemented by the new administration.

As a result of the outcome of the 2020 U.S. elections, the new administration could make significant legislative and policy

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changes in areas including but not limited to tax, trade, labor and the environment. If implemented, these changes could increase our effective tax rate, and increase our selling and/or manufacturing costs, which could have a material adverse effect on our business, results of operations or financial conditions. Changes in tax policy, trade regulations or other matters, and any uncertainty surrounding the scope or timing of such changes, could negatively impact the stock market, and reduce the trading price of our stock.

We are subject to stringent environmental and other regulations, which may force us to incur significant expenses.

We must comply with federal, state, local and foreign governmental regulations related to the use, storage, discharge and disposal of hazardous substances used in our products and manufacturing processes. Our failure to comply, or the failure of entities that we have acquired over time to have complied, with regulations could result in significant fines, liability for clean-up, suspension of production, cessation of operations or future liabilities. Such regulations have required us in the past, and could require us in the future, to incur significant expenses to comply with such regulations. Our failure to control the use of, or adequately restrict the discharge of, hazardous substances could impact the health of our employees and others and could impact our ability to operate. Such failure could also restrict our ability to ship certain products to certain countries, require us to modify our logistics, or require us to incur other significant costs and expenses. Environmental laws continue to expand with a focus on reducing or eliminating hazardous substances in electronic products and shipping materials. Future environmental regulations could require us to reengineer certain of our existing products and may make it more expensive for us to manufacture, sell and ship our products. In addition, the number and complexity of laws focused on the energy efficiency of electronic products, the recycling of electronic products, and the reduction in the amount and the recycling of packing materials have expanded significantly. It may be difficult for us to timely comply with these laws and we may have insufficient quantities of compliant products to meet customers' needs, thereby adversely impacting our sales and profitability. We may have to write off inventory if we hold unsaleable inventory as a result of changes to regulations. We expect these risks to continue. These requirements may increase our own costs, as well as those passed on to us by our supply chain.

Climate change regulations and sustained adverse climate change pose risks that could harm our results of operations.

Climate change regulations could require us to limit emissions, change manufacturing processes, substitute materials which may cost more or be less available, fund offset projects, obtain new permits or undertake other costly activities. Failure to obtain permits could result in fines, suspension or cessation of production. Restrictions on emissions could result in significant costs such as higher energy costs, carbon taxes, and emission cap and trade programs. The cost of compliance with such regulations could restrict our manufacturing operations, and have an adverse effect on our operating results.

Further, sustained adverse change in climate could have a direct adverse economic impact on us, such as utility shortages, and higher costs of utilities. Certain of our operations are located in arid or tropical regions, which some experts believe may become vulnerable to fires, storms, severe floods and droughts. While our business recovery plans are intended to allow us to recover from natural disasters or other disruptive events, our plans may not protect us from all events. 

Customer demands and regulations related to conflict-free minerals may force us to incur additional expenses.

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, in August 2012, the SEC released investigation, and disclosure requirements regarding the use of "conflict" minerals mined from the Democratic Republic of Congo and adjoining countries. We filed a Form SD with the SEC regarding such matters on May 29, 2020. Other countries are considering similar regulations. If we cannot certify that our supply chain is free from the risk of irresponsible sourcing, customers may demand that we change the sourcing of materials used in the manufacture of our products, even if the costs for compliant materials significantly increases or availability is limited.  If we change materials or suppliers, there will likely be costs associated with qualifying new suppliers and production capacity and quality could be negatively impacted.  Our relationships with customers and suppliers may be adversely affected if we are unable to certify that our products are free from the risk of irresponsible sourcing. We have incurred, and expect in the future to incur, additional costs associated with complying with these disclosure requirements, such as costs related to determining the source of any conflict minerals used in our products.  We may be unable to satisfy customers who require that all of the components of our products be certified as conflict free in a materially different manner than advocated by the Responsible Minerals Initiative or the Dodd-Frank Wall Street Reform and Consumer Protection Act.  If we are unable to meet customer requirements, customers may disqualify us as a supplier and we may have to write off inventory if it cannot be sold.

In addition to concerns over “conflict” minerals mined from the Democratic Republic of Congo, our customers may require that other minerals and substances used within our supply chain be evaluated and reported on. An increase in reporting obligations will increase associated operating costs. This could have negative effects on our overall operating profits.

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A requirement to fund our foreign pension plans could negatively affect our cash position and operating capital.

In connection with our acquisitions of Microsemi and Atmel, we assumed pension plans that cover certain French and German employees. Most of these plans are unfunded in compliance with statutory requirements, and we have no immediate intention of funding these plans. The projected benefit obligation totaled $70.0 million at March 31, 2020. Benefits are paid when amounts become due. We expect to pay approximately $1.3 million in fiscal 2021 for benefits earned. Should regulations require funding of these plans in the future, it could negatively affect our cash position and operating capital.

Risks Related to Capitalization and Financial Markets

The future trading price of our common stock could be subject to wide fluctuations in response to a variety of factors.

The market price of our common stock has fluctuated significantly in the recent past and is likely to fluctuate in the future. The future trading price of our common stock could be subject to wide fluctuations in response to a variety of factors, many of which are beyond our control, including, but not limited to:

•global economic and financial uncertainty due to the COVID-19 pandemic or other factors;

•quarterly variations in our operating results or the operating results of other technology companies;

•changes in our financial guidance or our failure to meet such guidance;

•changes in analysts' estimates of our financial performance or buy/sell recommendations;

•general conditions in the semiconductor industry;

•our ability to realize the expected benefits of our completed or future acquisitions; and

•actual or anticipated announcements of technical innovations or new products by us or our competitors.

In addition, the stock market has recently and in the past experienced significant price and volume fluctuations that have affected the market prices for many companies and that often have been unrelated to their operating performance. These broad market fluctuations and other factors have harmed and may harm the market price of our common stock. The foregoing factors could also cause the market price of our Convertible Debt to decline or fluctuate substantially.

Our financial condition and results of operations could be adversely impacted if we do not effectively manage current or future debt.

As of December 31, 2020, the principal amount of our outstanding indebtedness was $9.58 billion. In connection with our acquisition of Microsemi, we incurred $3.10 billion in debt under our Revolving Credit Facility, $3.00 billion under our Term Loan Facility, and $2.00 billion in senior secured notes. At December 31, 2020, we had $2.36 billion in outstanding borrowings under our Revolving Credit Facility which provides up to $3.57 billion of revolving loan commitments that terminate in 2023. As of December 31, 2020, we had repaid all amounts outstanding under our Term Loan Facility.

In December 2020, we used borrowings under our Revolving Credit Facility and issued $665.5 million principal amount in 2020 Senior Convertible Debt to finance the settlement of $1.09 billion of our 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt. In addition, we issued $1.40 billion principal amount in senior notes, and used borrowings under our Revolving Credit Facility to repay all amounts outstanding under our Term Loan Facility. In August 2020, we used borrowings under our Revolving Credit Facility to finance the cash portion of our settlement of $796.1 million in aggregate principal amount of our 2015 Senior Convertible Debt and our 2017 Senior Convertible Debt. In May 2020, we issued $2.20 billion principal amount in senior notes to finance the cash portion of our settlement of $1.03 billion in aggregate principal amount of our 2015 Senior Convertible Debt and our 2017 Senior Convertible Debt and used $615.0 million to repay in full our Bridge Loan Facility. The remaining proceeds were used for general corporate purposes, including repayment of a portion of our Revolving Credit Facility. In March 2020, we financed the settlement of $615.0 million in principal amount of our 2015 Senior Convertible Debt through borrowings under our Bridge Loan Facility. At December 31, 2020, we had $1.62 billion in aggregate principal of our Convertible Debt, consisting of $665.5 million of principal value issued in 2020, $734.1 million of aggregate principal value issued in 2017, and $222.4 million of principal value issued in 2015.

As a result of such transactions, we have substantially more debt than we had prior to May 2018. Our maintenance of substantial levels of debt could adversely affect our ability to take advantage of opportunities and could adversely affect our financial condition and results of operations. We may need or desire to refinance our current or future debt and there can be no assurance that we will be able to do so on reasonable terms, if at all.

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Servicing our debt requires a significant amount of cash, we may not have sufficient cash to fund payments and adverse changes in our credit ratings could increase our borrowing costs and adversely affect our ability to access the debt markets.

Our ability to make scheduled payments of principal, interest, or to refinance our indebtedness, including our outstanding Convertible Debt and Senior Notes, depends on our future performance, which is subject to economic, competitive and other factors including those related to the COVID-19 pandemic. Our business may not continue to generate sufficient cash flow to service our debt and to fund capital expenditures, dividend payments, share repurchases or acquisitions. If we are unable to generate such cash flow, we may be required to undertake alternatives, such as selling assets, restructuring debt or obtaining additional equity capital on onerous or highly dilutive terms. Our ability to refinance our indebtedness will depend on the capital markets and our financial condition at such time. Our senior secured notes are rated by certain major credit rating agencies. These credit ratings impact our cost of borrowing and our ability to access the capital markets and are based on our financial performance and financial metrics including debt levels. There is no assurance that we will maintain our current credit ratings. A downgrade of our credit rating by a major credit rating agency could result in increased borrowing costs and could adversely affect our ability to access the debt markets to refinance our existing debt or finance future debt.

Conversion of our Convertible Debt will dilute the ownership interest of our existing stockholders.

The conversion of some or all of our outstanding Convertible Debt will dilute the ownership interest of existing stockholders to the extent we deliver common stock upon conversion of such debt. Upon conversion, we may satisfy our conversion obligation by delivering cash, shares of common stock or any combination, at our option. If upon conversion we elect to deliver cash for the lesser of the conversion value and principal amount of the Convertible Debt, we would pay the holder the cash value of the applicable number of shares of our common stock. Upon conversion, we intend to satisfy the lesser of the principal amount or the conversion value in cash. If the conversion value of the Convertible Debt exceeds the principal amount, we may also elect to deliver cash in lieu of common stock for the conversion value in excess of the one thousand dollars principal amount (i.e., the conversion spread). There would be no adjustment to the numerator in the net income per common share computation for the cash settled portion of the Convertible Debt as that portion of the debt instrument will always be settled in cash. The conversion spread will be included in the denominator for the computation of diluted net income per common share. Any sales in the public market of any common stock issuable upon conversion of our Convertible Debt could adversely affect prevailing market prices of our common stock. In addition, the existence of the Convertible Debt may encourage short selling by market participants because the conversion of the Convertible Debt could be used to satisfy short positions, or anticipated conversion of the Convertible Debt into shares of our common stock could depress the price of our common stock.

Fluctuations in foreign currency exchange rates could adversely impact our operating results.

We use forward currency exchange contracts in an attempt to reduce the adverse earnings impact from the effect of exchange rate fluctuations on our non-U.S. dollar net balance sheet exposures. Nevertheless, in periods when the U.S. dollar significantly fluctuates in relation to the non-U.S. currencies in which we transact business, the value of our non-U.S. dollar transactions can have an adverse effect on our results of operations and financial condition. In particular, in periods when the value of a non-U.S. currency significantly declines relative to the U.S. dollar, customers transacting in that currency may be unable to fulfill their contractual obligations or to undertake new obligations to make payments or purchase products. In periods when the U.S. dollar declines significantly relative to the British pound, Euro, Thai baht and Taiwan dollar, the operational costs in our European and Thailand subsidiaries are adversely affected. Although our business has not been materially adversely impacted by recent changes in the value of the U.S. dollar, there can be no assurance as to the future impact that any weakness or strength in the U.S. dollar will have on our business or results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We did not repurchase any shares of our common stock in the three months ended December 31, 2020.

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Item 6. Exhibits

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File Number	Exhibit	Filing Date	Included Herewith
3.1	Restated Certificate of Incorporation of Registrant	10-Q	000-21184	3.1	11/12/2002
3.2	Amended and Restated Bylaws of Registrant, as amended effective January 3, 2021					X
4.1	Indenture, dated as of December 1, 2020, between Microchip Technology Incorporated and Wells Fargo Bank, National Association, as trustee.	8-K	000-21184	4.1	12/2/2020
4.2	Form of 0.125% Convertible Senior Note due 2024 (included in Exhibit 4.1 of the 8-K filed on December 2, 2020).	8-K	000-21184	4.2	12/2/2020
4.3	Senior Secured Notes Indenture, dated as of December 17, 2020, by and among Microchip Technology Incorporated, the subsidiary guarantors named therein and Wells Fargo Bank, National Association, as trustee and collateral agent.	8-K	000-21184	4.1	12/18/2020
4.4	Form of 0.972% Senior Secured Note due 2024 (included in Exhibit 4.1 of the 8-K filed on December 18, 2020).	8-K	000-21184	4.2	12/18/2020
10.1	Form of Exchange Agreement	8-K	000-21184	10.1	11/20/2020
10.2	Form of Capped Call Confirmation	8-K	000-21184	10.2	11/20/2020
10.3	Purchase Agreement, dated as of December 14, 2020, by and among Microchip Technology Incorporated, the subsidiary guarantors named therein, J.P. Morgan Securities LLC, Truist Securities, Inc. and Wells Fargo Securities LLC, as representatives of the several initial purchasers named therein.	8-K	000-21184	10.1	12/15/2020
10.4	Pledge and Security Agreement, dated as of December 17, 2020, by and among Microchip Technology Incorporated, the subsidiary guarantors named therein and Wells Fargo Bank, National Association, as collateral agent.	8-K	000-21184	10.1	12/18/2020
31.1	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act)					X
31.2	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act)					X
32*	Certifications Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002					X

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		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File Number	Exhibit	Filing Date	Included Herewith
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

* Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		MICROCHIP TECHNOLOGY INCORPORATED
Date:	February 4, 2021	By: /s/ J. Eric Bjornholt
		J. Eric Bjornholt
		Senior Vice President and Chief Financial Officer
		(Duly Authorized Officer, and Principal Financial and Accounting Officer)

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EX-3.2

EXHIBIT 3.2

AMENDED AND RESTATED BYLAWS

OF

MICROCHIP TECHNOLOGY INCORPORATED

(as amended effective January 3, 2021)

TABLE OF CONTENTS
		Page
ARTICLE I - CORPORATE OFFICES		1
1.1	Registered Office	1
1.2	Other Offices	1
ARTICLE II - STOCKHOLDERS		1
2.1	Place of Meetings	1
2.2	Annual Meeting	2
2.3	Special Meeting	2
2.4	Advance Notice of Stockholder Nominees and Stockholder Business	2
2.5	Notice of Stockholders Meetings	6
2.6	Quorum	6
2.7	Adjourned Meeting; Notice	7
2.8	Voting	7
2.9	Waiver of Notice	7
2.10	Stockholder Action by Written Consent Without a Meeting	8
2.11	Record Date for Stockholder Notice; Voting; Giving Consents	9
2.12	Proxies	10
2.13	List of Stockholders Entitled to Vote	10
2.14	Conduct of Business	11
2.15	Inspectors of Election	12
2.16	Inspectors of Election and Procedures for Counting Written Consents	12
2.17	Election Not To Be Subject to Arizona Control Share Acquisitions Statute	14
2.18	Proxy Access for Director Nominees	14
ARTICLE III - DIRECTORS		27
3.1	Powers	27
3.2	Number of Directors	27
3.3	Election; Qualification and Term of Office of Directors	27
3.4	Resignation and Vacancies	28
3.5	Place of Meetings; Meetings by Telephone	29
3.6	Regular Meetings	29
3.7	Special Meetings; Notice	30
3.8	Quorum	30
3.9	Waiver of Notice	30
3.10	Adjourned Meeting; Notice	31
3.11	Board Action by Written Consent Without a Meeting	31
3.12	Fees and Compensation of Directors	31
3.13	Loans	32
3.14	Removal of Directors	32
3.15	Conduct of Business	32
3.16	Presumption of Assent	33
ARTICLE IV - COMMITTEES		33
4.1	Committees of Directors	33

4.2	Committee Minutes	34
4.3	Meetings and Action of Committees	34
ARTICLE V - OFFICERS		35
5.1	Officers	35
5.2	Appointment of Officers	35
5.3	Subordinate Officers	35
5.4	Removal and Resignation of Officers	35
5.5	Vacancies in Offices	36
5.6	Chairman of the Board	36
5.7	Chief Executive Officer	36
5.8	President	36
5.9	Vice Presidents	36
5.10	Secretary	37
5.11	Chief Financial Officer	37
5.12	Treasurer	38
5.13	Assistant Secretary	38
5.14	Assistant Treasurer	38
5.15	Authority and Duties of Officers	38
5.16	Representation of Shares of Other Corporations	38
ARTICLE VI - INDEMNITY		39
6.1	Indemnification of Directors and Officers	39
6.2	Indemnification of Others	39
6.3	Insurance	40
ARTICLE VII - RECORDS AND REPORTS		40
7.1	Maintenance and Inspection of Records	40
7.2	Inspection by Directors	40
ARTICLE VIII - MANNER OF GIVING NOTICE AND WAIVER		41
8.1	Notices	41
8.2	Notice to Stockholders Sharing an Address	42
8.3	Notice to Person with whom Communicating is Unlawful	42
8.4	Waiver of Notice	43
ARTICLE IX - GENERAL MATTERS		43
9.1	Checks	43
9.2	Execution of Corporate Contracts and Instruments	43
9.3	Stock Certificates; Partly Paid	44
9.4	Special Designation on Certificates	44
9.5	Lost Certificates	45
9.6	Construction; Definitions	45
9.7	Dividends	46
9.8	Fiscal Year	46
9.9	Seal	46
9.10	Transfer of Stock	46
9.11	Stock Transfer Agreements	47
9.12	Registered Stockholders	47
ARTICLE X - AMENDMENTS		47

AMENDED AND RESTATED BYLAWS OF

MICROCHIP TECHNOLOGY INCORPORATED

(as amended effective January 3, 2021)

ARTICLE I

CORPORATE OFFICES

1.1    Registered Office. The registered office of the corporation shall be in the City of Dover, County of Kent, State of Delaware. The name of the registered agent of the corporation at such location is The Corporation Trust Company.

1.2    Other Offices. The corporation may also have offices at such other places both within and without the State of Delaware as the board of directors may from time to time determine or the business of the corporation may require.

ARTICLE II

STOCKHOLDERS

2.1    Place of Meetings. Meetings of stockholders shall be held at any place, within or outside the State of Delaware, designated by the board of directors. The board of directors may, in its sole discretion, determine that a meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication as authorized by Section 211(a)(2) of the General Corporation Law of Delaware. In the absence of any such designation, stockholders’ meetings shall be held at the registered office of the corporation.

2.2    Annual Meeting. The annual meeting of stockholders shall be held, each year, on a date and at a time designated by the board of directors. At the meeting, directors shall be elected and any other proper business may be transacted.

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2.3    Special Meeting. A special meeting of the stockholders may be called at any time by the board of directors or by the chairman of the board or by one or more stockholders owning in the aggregate not less than fifty percent (50%) of the entire capital stock of the corporation issued and outstanding and entitled vote.

If a special meeting is called by any person or persons other than the board of directors, the request shall be in writing, specifying the time of such meeting and the general nature of the business proposed to be transacted, and shall be delivered personally or sent by registered mail or by telegraphic or other facsimile transmission to the chairman of the board, the president, chief executive officer or the secretary of the corporation. No business may be transacted at such special meeting otherwise than specified in such notice. The officer receiving the request shall cause notice to be promptly given to the stockholders entitled to vote, in accordance with the provisions of Section 2.5 and Article VIII, that a meeting will be held at the time requested by the person or persons who called the meeting, not less than thirty-five (35) nor more than sixty (60) days after the receipt of the request. If the notice is not given within twenty (20) days after the receipt of the request, the person or persons requesting the meeting may give the notice. Nothing contained in this paragraph of this Section 2.3 shall be construed as limiting, fixing, or affecting the time when a meeting of stockholders called by action of the board of directors may be held.

2.4    Advance Notice of Stockholder Nominees and Stockholder Business.

(a)    At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting business must be (A) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the board of directors, (B) otherwise properly brought before the meeting by or at the direction of the board of directors, or (C) otherwise properly brought before the meeting by a stockholder. For business to be properly brought before an annual meeting by a stockholder, the secretary of the corporation must have received timely notice in writing from the stockholder. To be timely, a stockholder’s notice must be delivered to or mailed and received at the principal executive offices of the corporation not less than ninety (90) calendar days before the date on which the corporation first mailed

2

its proxy statement to stockholders in connection with the previous year’s annual meeting of stockholders; provided, however, that in the event that no annual meeting was held in the previous year or the date of the annual meeting has been changed by more than thirty (30) days from the prior year, notice by the stockholder to be timely must be so received not later than the close of business on the later of ninety (90) calendar days in advance of such annual meeting or ten (10) calendar days following the date on which public announcement of the date of the meeting is first made. Such written notice to the secretary shall set forth, as to each matter the stockholder proposes to bring before the annual meeting: (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (ii) the name and address, as they appear on the corporation's books, of the stockholder proposing such business and any Stockholder Associated Person (as defined below), (iii) the class and number of shares of stock of the corporation beneficially owned by such stockholder or any Stockholder Associated Person, (iv) whether and the extent to which any hedging or other transaction or series of transactions has been entered into by or on behalf of such stockholder or any Stockholder Associated Person with respect to any securities of the corporation, and a description of any other agreement, arrangement or understanding (including any short position or any borrowing or lending of shares), the effect or intent of which is to mitigate loss to, or to manage the risk or benefit from share price changes for, or to increase or decrease the voting power of, such stockholder or any Stockholder Associated Person with respect to any securities of the corporation, (v) any material interest of such stockholder or any Stockholder Associated Person in such business, (vi) a statement whether either such stockholder or any Stockholder Associated Person will deliver a proxy statement and form of proxy to holders of at least the percentage of the corporation's voting shares required under applicable law to carry the proposal and (vii) any other information that is required to be provided by the stockholder pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "1934 Act"), in his or her capacity as a proponent to a stockholder proposal (such information provided and statements made as required by clauses (i) through (vii), a "Business Solicitation Statement"). Notwithstanding the foregoing, in order to include information with respect to a stockholder proposal in the proxy statement and form of proxy for a stockholder's meeting, stockholders must provide notice as required by the regulations promulgated under the 1934 Act. In addition, to be in proper written form, a stockholder's notice to the secretary must be supplemented not later than ten (10) days following the record date for the

3

determination of stockholders entitled to vote at the meeting to disclose the information contained in clauses (iii) and (iv) above as of the record date. For purposes of this Section 2.4, a "Stockholder Associated Person" of any stockholder shall mean (i) any person controlling, directly or indirectly, or acting in concert with, such stockholder, (ii) any beneficial owner of shares of stock of the corporation owned of record or beneficially by such stockholder and on whose behalf the proposal or nomination, as the case may be, is being made, or (iii) any person controlling, controlled by or under common control with such person referred to in the preceding clauses (i) and (ii). Notwithstanding any provision in the Bylaws to the contrary, no business shall be conducted at an annual meeting except in accordance with the procedures set forth in this paragraph (a). In addition, business proposed to be brought by a stockholder may not be brought before the annual meeting if such stockholder or a Stockholder Associated Person, as applicable, takes action contrary to the representations made in the Business Solicitation Statement applicable to such business or if the Business Solicitation Statement applicable to such business contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein not misleading. The chairman of the annual meeting shall, if the facts warrant, determine and declare at the meeting that business was not properly brought before the meeting and in accordance with the provisions of this paragraph (a), and, if he or she should so determine, he or she shall so declare at the meeting that any such business not properly brought before the meeting shall not be transacted.

(b)    Only persons who are nominated in accordance with the procedures set forth in this paragraph (b) shall be eligible for election or re-election as directors. Nominations of persons for election to the board of directors of the corporation may be made at a meeting of stockholders by or at the direction of the board of directors or by any stockholder of the corporation entitled to vote in the election of directors at the meeting who complies with the notice procedures set forth in this paragraph (b). Such nominations, other than those made by or at the direction of the board of directors, shall be made pursuant to timely notice in writing to the secretary of the corporation. To be considered timely, (i) in the case of an annual meeting, such notice must be delivered in accordance with the provisions of paragraph (a) of this Section 2.4, and (ii) in the case of a special meeting, such notice must be received by the secretary of the corporation not later than the close of business on the later of the 90th day prior to such special

4

meeting or the tenth day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the board of directors to be elected at such meeting. Such stockholder's notice shall set forth (i) as to each person, if any, whom the stockholder proposes to nominate for election or re-election as a director: (A) the name, age, business address and residence address of such person, (B) the principal occupation or employment of such person, (C) the class and number of shares of the corporation which are beneficially owned by such person, (D) whether and the extent to which any hedging or other transaction or series of transactions has been entered into by or on behalf of such person with respect to any securities of the corporation, and a description of any other agreement, arrangement or understanding (including any short position or any borrowing or lending of shares), the effect or intent of which is to mitigate loss to, or to manage the risk or benefit of share price changes for, or to increase or decrease the voting power of such person, (E) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nominations are to be made by the stockholder, (F) a written statement executed by the nominee acknowledging that as a director of the corporation, the nominee will owe a fiduciary duty under Delaware law with respect to the corporation and its stockholders, and (G) any other information relating to such person that is required to be disclosed in solicitations of proxies for elections of directors, or is otherwise required, in each case pursuant to Regulation 14A under the 1934 Act (including without limitation such person's written consent to being named in the proxy statement, if any, as a nominee and to serving as a director if elected); and (ii) as to such stockholder giving notice, the information required to be provided pursuant to paragraph (a) of this Section 2.4 (except that the references to "business" in such clauses shall instead refer to nominations of directors for purposes of this paragraph). At the request of the board of directors, any person nominated by a stockholder for election as a director shall furnish to the secretary of the corporation that information required to be set forth in the stockholder's notice of nomination which pertains to the nominee and such other information as may reasonably be required by the corporation to determine the eligibility of such proposed nominee to serve as an independent director of the corporation or that could be material to a reasonable stockholder's understanding of the independence, or lack thereof, of such nominee, and in the absence of the furnishing of such information if requested, such stockholder's nomination shall not be considered in proper form pursuant to this Section 2.4(b). No person shall be eligible for election or re-

5

election as a director of the corporation unless nominated in accordance with the procedures set forth in this paragraph (b). In addition, a nominee shall not be eligible for election or re-election if a stockholder or Stockholder Associated Person, as applicable, takes action contrary to the representations made in the Nominee Solicitation Statement applicable to such nominee or if the Nominee Solicitation Statement applicable to such nominee contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein not misleading. The chairman of the meeting shall, if the facts warrant, determine and declare at the meeting that a nomination was not made in accordance with the procedures prescribed by these Bylaws, and if he or she should so determine, he or she shall so declare at the meeting, and the defective nomination shall be disregarded.

2.5    Notice of Stockholders Meetings. All notices of meetings of stockholders shall be in writing and shall be sent or otherwise given in accordance with Article VIII of these bylaws not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting, except as otherwise provided herein or required by law (meaning, here and hereinafter, as required from time to time by the General Corporation Law of Delaware or the certificate of incorporation of the corporation). The notice shall specify the place, date, and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called.

2.6    Quorum. At any meeting of the stockholders, the holders of a majority, present in person or by proxy, of all of the shares of the stock entitled to vote at the meeting shall constitute a quorum for all purposes, unless or except to the extent that the presence of a larger number may be required by law. Where a separate vote by a class or classes is required, a majority, present in person or by proxy, of the shares of such class or classes entitled to take action with respect to that vote on that matter shall constitute a quorum. If a quorum shall fail to attend any meeting, the chairman of the meeting may adjourn the meeting to another place, date or time.

If a notice of any adjourned special meeting of stockholders is sent to all stockholders entitled to vote thereat, stating that it will be held with those present constituting a quorum, those present at such adjourned meeting shall constitute a quorum (but in no event shall a quorum consist of less than one-third

6

of the shares entitled to vote at the meeting), and all matters shall be determined by a majority of the votes cast at such meeting, except as otherwise required by law.

2.7    Adjourned Meeting; Notice. When a meeting is adjourned to another time or place, unless these bylaws otherwise require, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business that might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

2.8    Voting. The stockholders entitled to vote at any meeting of stockholders shall be determined in accordance with the provisions of Section 2.11 of these bylaws, subject to the provisions of Sections 217 and 218 of the General Corporation Law of Delaware (relating to voting rights of fiduciaries, pledgors and joint owners of stock and to voting trusts and other voting agreements).

Each stockholder shall have one (1) vote for every share of stock entitled to vote that is registered in his or her name on the record date for the meeting (as determined in accordance with Section 2.11 of these bylaws), except as otherwise provided herein or required by law.

All elections shall be determined by a plurality of the votes cast, and except as otherwise required by law or provided herein, all other matters shall be determined by a majority of the votes cast affirmatively or negatively; except that a nominee for director shall be elected to the board of directors if the votes cast for such nominee's election exceed the votes cast against such nominee's election. For this purpose, votes cast shall exclude abstentions, withheld votes or broker non-votes with respect to that director's election. Notwithstanding the immediately preceding sentence, in the event of a contested election of directors, directors shall be elected by the vote of a plurality of the votes cast. For the purpose of this bylaw, a contested election shall mean any election of directors in which the number of candidates for election as director exceeds the number of directors to be elected. If directors are to be elected by a plurality of the votes cast, stockholders shall not be permitted to vote against a nominee.

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2.9    Waiver of Notice. Whenever notice is required to be given under any provision of the General Corporation Law of Delaware or of the certificate of incorporation or these bylaws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice unless so required by the certificate of incorporation or these bylaws.

2.10    Stockholder Action by Written Consent Without a Meeting. Any action required or able to be taken at any annual or special meeting of stockholders may be taken without a meeting, without prior notice, and without a vote if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the corporation at its registered office in Delaware, its principal place of business, or to an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery to the corporation's registered office shall be made by hand or by certified or registered mail, return receipt requested.

Every written consent shall bear the date of signature of each stockholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless, within sixty (60) days after the date the earliest dated consent is delivered to the corporation, a written consent or consents signed by holders of a sufficient number of votes to take action are delivered to the corporation in the manner prescribed in the first paragraph of this section.

Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. If the action which is consented to is such as would have required the filing of a certificate under any section of the General Corporation Law of Delaware if such action had been voted on by stockholders at a meeting

8

thereof, then the certificate filed under such section shall state, in lieu of any statement required by such section concerning any vote of stockholders, that written notice and written consent have been given as provided in Section 228 of the General Corporation Law of Delaware.

2.11    Record Date for Stockholder Notice; Voting; Giving Consents. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the board of directors may fix a record date, which shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other action.

If the board of directors does not so fix a record date:

(i)    The record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held.

(ii)    The record date for determining stockholders entitled to receive payment of any dividend or other distribution or allotment of rights or to exercise any rights of change, conversion or exchange of stock or for any other purpose shall be at the close of business on the day on which the board of directors adopts the resolution relating thereto.

In order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the board of directors may fix a record date, which record date shall neither precede nor be more than ten (10) days after the date upon which such resolution is adopted by the board of directors. Any stockholder of record seeking to have the stockholders authorize or take action by written consent shall, by written notice to the secretary, request the board of directors to fix a record date. The board of directors shall promptly, but in all events within ten (10) days after the date on which such notice is received, adopt a resolution fixing the record date.

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If the board of directors has not fixed a record date within such time, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the board of directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in the manner prescribed in the first paragraph of Section 2.10 of these bylaws. If the board of directors has not fixed a record date within such time and prior action by the board of directors is required by law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the date on which the board of directors adopts the resolution taking such prior action.

A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting.

2.12    Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him or her by a written proxy or an electronic transmission permitted by law, filed in accordance with the procedure established for the meeting or taking of action in writing, but no such proxy shall be voted or acted upon after three (3) years from its date, unless the proxy provides for a longer period. Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission created pursuant to this Section 2.12 may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Section 212(c) of the General Corporation Law of Delaware.

2.13    List of Stockholders Entitled to Vote. The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and

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showing the address of each stockholder and the number of shares registered in the name of each stockholder. The corporation shall not be required to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the examination of any stockholder for any purpose germane to the meeting for a period of at least ten (10) days prior to the meeting: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the principal place of business of the corporation. In the event that the corporation determines to make the list available on an electronic network, the corporation may take reasonable steps to ensure that such information is available only to stockholders of the corporation. If the meeting is to be held at a place, then a list of stockholders entitled to vote at the meeting shall be produced and kept at the time and place of the meeting during the whole time thereof and may be examined by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then such list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Such list shall presumptively determine the identity of the stockholders entitled to vote at the meeting and the number of shares held by each of them.

2.14    Conduct of Business. The Board of Directors will appoint a Chairman of the meeting, and he/she shall be authorized to be the final authority on all matters of procedure at the meeting. The rules provided below will govern the conduct of the meeting of stockholders and will be strictly enforced to maintain an orderly meeting. Robert’s Rules of Order will not be applicable and will not be utilized.

(i)    Method of Obtaining the Floor. Stockholders who desire to address the meeting must raise their hands and wait to be recognized by the Chairman. Only when a stockholder is recognized as having the floor may he or she address the meeting.

(ii)    Discussion. Persons addressing the meeting must limit their remarks to the issue then under consideration by the stockholders and to not more than five minutes in duration. A stockholder will be permitted to address the meeting on a particular issue not more than three times.

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(iii)    Stockholder Proposals. Stockholders will only be permitted to address the meeting on proposals that are included in the proxy statement and proxy relating to that meeting.

2.15    Inspectors of Election. The corporation may, and to the extent required by law, shall, in advance of any meeting of stockholders, appoint one or more inspectors to act at the meeting and make a written report thereof. The corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the person presiding at the meeting may, and to the extent required by law, shall, appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. Every vote taken by ballots shall be counted by an inspector or inspectors appointed by the chairman of the meeting.

2.16    Inspectors of Election and Procedures for Counting Written Consents. Within three (3) business days after receipt of the earliest dated consent delivered to the corporation in the manner provided in Section 228(c) of the General Corporation Law of Delaware or the determination by the board of directors of the corporation that the corporation should seek corporate action by written consent, as the case may be, the secretary may engage nationally recognized independent inspectors of elections for the purpose of performing a ministerial review of the validity of the consents and revocations. The cost of retaining inspectors of election shall be borne by the corporation.

Consents and revocations shall be delivered to the inspectors upon receipt by the corporation, the stockholder or stockholders soliciting consents or soliciting revocations in opposition to action by consent proposed by the corporation (the "Soliciting Stockholders") or their proxy solicitors or other designated agents. As soon as consents and revocations are received, the inspectors shall review the consents and revocations and shall maintain a count of the number of valid and unrevoked consents. As soon as practicable after the earlier of (i) sixty (60) days after the date of the earliest dated consent delivered to the corporation in the manner provided in Section 228(c) of the General Corporation Law of Delaware or (ii) a written request therefor by the corporation or the Soliciting Stockholders (whichever is soliciting consents) (which request, except in the case of corporate action by written consent taken pursuant to the

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solicitations of not more than ten (10) persons, may be made no earlier than after such reasonable amount of time after the commencement date of the applicable solicitation of consents as is necessary to permit the inspectors to commence and organize their count, but in no event less than five (5) days after such commencement date), notice of which request shall be given to the party opposing the solicitation of consents, if any, which request shall state that the corporation or Soliciting Stockholders, as the case may be, have a good faith belief that the requisite number of valid and unrevoked consents to authorize or take the action specified in the consents has been received in accordance with these bylaws, the inspectors shall issue a preliminary report to the corporation and the Soliciting Stockholders stating: (i) the number of valid consents; (ii) the number of valid revocations; (iii) the number of valid and unrevoked consents; (iv) the number of invalid consents; (v) the number of invalid revocations; and (vi) whether, based on their preliminary count, the requisite number of valid and unrevoked consents has been obtained to authorize or take the action specified in the consents.

Unless the corporation and the Soliciting Stockholders shall agree to a shorter or longer period, the corporation and the Soliciting Stockholders shall have 48 hours to review the consents and revocations and to advise the inspectors and the opposing party in writing as to whether they intend to challenge the preliminary report of the inspectors. If no written notice of an intention to challenge the preliminary report is received within 48 hours after the inspectors' issuance of the preliminary report, the inspectors shall issue to the corporation and the Soliciting Stockholders their final report containing the information from the inspectors' determination with respect to whether the requisite number of valid and unrevoked consents was obtained to authorize and take the action specified in the consents. If the corporation or the Soliciting Stockholders issue written notice of an intention to challenge the inspectors' preliminary report within 48 hours after the issuance of that report, a challenge session shall be scheduled by the inspectors as promptly as practicable. A transcript of the challenge session shall be recorded by a certified court reporter. Following completion of the challenge session, the inspectors shall as promptly as practicable issue their final report to the corporation and the Soliciting Stockholders, which report shall contain the information included in the preliminary report, plus all changes made to the vote totals as a result of the challenge and a certification of whether the requisite number of valid and unrevoked consents was obtained to authorize or take the action specified in the consents. A copy of the final report of the

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inspectors shall be included in the book in which the proceedings of meetings of stockholders are recorded.

2.17    Election Not To Be Subject to Arizona Control Share Acquisitions Statute. The corporation elects not to be subject to Title 10, Chapter 23, Article 2 of the Arizona Revised Statutes relating to "Control Share Acquisitions."

2.18Proxy Access for Director Nominees.

(a)Inclusion of Stockholder Nominees in Proxy Materials. Whenever the board of directors solicits proxies with respect to the election of directors at an annual meeting (beginning with the annual meeting to be held in 2020), subject to the provisions of this Section 2.18, the corporation will include in its proxy materials for such annual meeting, in addition to any persons nominated for election by the board of directors or a committee appointed by the board of directors, the name, together with the Required Information (as defined below), of any person properly nominated for election (a “Stockholder Nominee”) to the board of directors by an Eligible Stockholder (as defined below). An Eligible Stockholder must expressly elect, at the time of providing the notice required by this Section 2.18 (the “Nomination Notice”), to have each nominee of such Eligible Stockholder included in the corporation’s proxy materials pursuant to this Section 2.18. For the avoidance of doubt, if a Stockholder Nominee is included in the corporation’s proxy materials for an annual meeting, then the corporation will also include such Stockholder Nominee on (i) any ballot distributed at such annual meeting; (ii) the corporation’s proxy card; and (iii) any other format through which the corporation permits proxies to be submitted.

(b)    Definition of Eligible Stockholder. An “Eligible Stockholder” is a stockholder, or a group of no more than 20 stockholders, of the corporation that has satisfied (individually or, in the case of a group, collectively) all applicable conditions and has complied with all applicable procedures, in each case as set forth in this Section 2.18. No person may be a member of more than one group of persons constituting an Eligible Stockholder. A record holder acting on behalf of one or more beneficial owners will not be counted separately as a stockholder with respect to the shares owned by beneficial owners on whose behalf such record holder has been directed in writing to act, but each such beneficial owner will

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be counted separately, subject to the other provisions of this Section 2.18, for purposes of determining the number of stockholders whose holdings may be considered as part of an Eligible Stockholder’s holdings. For purposes of this Section 2.18, two or more funds or trusts will be treated as one stockholder or beneficial owner (a “Qualifying Fund”) if they are (i) under common management and investment control; (ii) under common management and funded primarily by the same employer; or (iii) a “group of investment companies,” as such term is defined in Section 12(d)(1)(G)(ii) of the Investment Company Act of 1940, as amended.

(c)    Required Information. For purposes of this Section 2.18, the “Required Information” that the corporation will include in its proxy materials is (i) the information concerning the Stockholder Nominee and the Eligible Stockholder that is required to be disclosed in the corporation’s proxy statement by the rules and regulations of the Securities and Exchange Commission (the “SEC”) promulgated under the 1934 Act; and (ii) if the Eligible Stockholder so elects, one or more Supporting Statements (as defined below).

(d)    Delivery of Nomination Notice. To be timely, a Nomination Notice must be delivered to, or mailed and received at, the principal executive offices of the corporation not less than 120 days nor more than 150 days prior to the anniversary of the day on which the corporation’s proxy statement relating to the immediately preceding annual meeting was first released to stockholders. No adjournment, postponement or other delay of an annual meeting, or any public announcement thereof, will commence a new time period (or extend any time period) for the giving of a Nomination Notice.

(e)    Maximum Number of Stockholder Nominees.

(i) Maximum Number; Reductions. The maximum aggregate number of Stockholder Nominees that will be included in the corporation’s proxy materials with respect to an annual meeting will depend on the number of directors to be elected at such annual meeting. Specifically, in the event that the number of directors to be elected at the annual meeting is seven (7) or less, the maximum aggregate number of Stockholder Nominees that will be included in the corporation’s proxy materials with respect to such annual meeting shall be one (1) and, if the number of directors to be elected at the

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annual meeting is greater than seven (7), the maximum aggregate number of Stockholder Nominees that will be included in the corporation’s proxy materials with respect to such annual meeting will not exceed the greater of (A) two or (B) 20 percent of the number of directors in office as of the last day on which a Nomination Notice may be delivered pursuant to this Section 2.18, or if such amount is not a whole number, then the closest whole number below 20 percent. This maximum number will be reduced by (1) the number of persons serving as directors or as nominees for director who, in either case, were elected or appointed to the board of directors or will be included in the corporation’ proxy materials as an unopposed (by the corporation) nominee pursuant to an agreement, arrangement or other understanding with a stockholder or group of stockholders (other than any such agreement, arrangement or understanding entered into in connection with an acquisition of shares of common stock of the corporation by such stockholder or group of stockholders from the corporation), other than any director whose term of office will expire at such annual meeting and who is not seeking (or agreeing) to be nominated at such annual meeting for another term of office; (2) any Stockholder Nominee whose name was submitted by an Eligible Stockholder for inclusion in the corporation’s proxy materials pursuant to this Section 2.18 but either (a) is subsequently withdrawn, disregarded or declared invalid or ineligible; or (b) that the board of directors or a committee appointed by the board of directors decides to nominate for election; (3) the number of incumbent directors (as of the last day on which a Nomination Notice may be delivered pursuant to this Section 2.18) who were Stockholder Nominees at any of the preceding three annual meetings (including any individual covered under clause (2) above) and whose election at the upcoming annual meeting is being recommended by the board of directors; and (4) the number of persons nominated in accordance with Section 2.4 (whether or not such nomination is subsequently withdrawn) at the annual meeting.

(ii) Impact of Vacancies. If (A) one or more vacancies for any reason occurs on the board of directors after the last day on which a Nomination Notice may be delivered pursuant to this Section 2.18 but before the date of the annual meeting and (B) the board of directors resolves to reduce the size of the board of directors in connection with such vacancy, then the maximum number of Stockholder Nominees will be calculated based on the number of directors in office as so reduced.

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(iii) Ranking of Stockholder Nominees. Any Eligible Stockholder submitting more than one Stockholder Nominee for inclusion in the corporation’s proxy materials must rank its Stockholder Nominees in its Nomination Notice based on the order in which the Eligible Stockholder desires that such Stockholder Nominees be selected for inclusion in the corporation’s proxy materials. If the number of Stockholder Nominees submitted by Eligible Stockholders exceeds the maximum number of nominees provided for pursuant to Section 2.18(e)(i), then the highest-ranking qualifying Stockholder Nominee of each Eligible Stockholder will be selected by the corporation for inclusion in the corporation’s proxy materials until the maximum number of Stockholder Nominees is reached, going in order by the number (largest to smallest) of shares of common stock of the corporation that each Eligible Stockholder disclosed as Owned (as defined below) in its Nomination Notice. If the maximum number of Stockholder Nominees is not reached after the highest-ranking qualifying Stockholder Nominee of each Eligible Stockholder has been selected, then this process will continue with the next highest-ranked Stockholder Nominees as many times as necessary, following the same order each time, until the maximum number is reached.

(f)    Ownership. For purposes of this Section 2.18, an Eligible Stockholder will be deemed to “Own” only those outstanding shares of common stock of the corporation as to which the Eligible Stockholder possesses both (i) the full voting and investment rights pertaining to the shares; and (ii) the full economic interest in (including the opportunity for profit and risk of loss on) such shares. The number of shares calculated in accordance with the prior sentence will not include any shares (A) sold by such Eligible Stockholder or any of its affiliates in any transaction that has not been settled or closed, including any short sale; (B) borrowed by such Eligible Stockholder or any of its affiliates for any purpose; (C) purchased by such Eligible Stockholder or any of its affiliates subject to an agreement to resell; or (D) subject to any option, warrant, forward contract, swap, contract of sale, or other derivative or similar agreement entered into by such Eligible Stockholder or any of its affiliates, whether any such instrument or agreement is to be settled with shares or with cash based on the notional amount or value of shares of common stock of the corporation, in any such case which instrument or agreement has, or is intended to have, or if exercised would have, the purpose or effect of (1) reducing in any manner, to any extent or at any time in the future, the full right to vote or direct the voting of any such shares by the

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Eligible Stockholder or its affiliates; or (2) hedging, offsetting or altering to any degree any gain or loss arising from the full economic ownership of such shares by such Eligible Stockholder or its affiliates. A stockholder will “Own” shares held in the name of a nominee or other intermediary so long as the stockholder retains the right to instruct how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares. A stockholder’s Ownership of shares will be deemed to continue during any period in which the stockholder has (a) loaned such shares so long as the stockholder has the power to recall such loaned shares on no more than five business days’ notice and includes with the Nomination Notice an agreement that it (i) will promptly recall such loaned shares upon being notified by the corporation that any of its Stockholder Nominees will be included in the corporation’s proxy materials and (ii) will continue to hold such recalled shares through the date of the annual meeting; or (b) delegated any voting power by means of a proxy, power of attorney, or other instrument or arrangement that is revocable at any time by the stockholder. The terms “Owned,” “Owning”, “Ownership” and other variations of the word “Own” will have correlative meanings. For purposes of this Section 2.18, the term “affiliate” will have the meaning given to it in Rule 405 promulgated under the Securities Act of 1933 (the “Securities Act”).

(g)    Eligible Stockholder Requirements.

(i) Ownership Requirement. To make a nomination pursuant to this Section 2.18, an Eligible Stockholder must have Owned continuously for at least three years (the “Holding Period”) a number of shares representing at least three percent of the corporation’s common stock (such required number of shares, the “Required Shares”). For purposes of determining whether the Eligible Stockholder owned the Required Shares for the Holding Period, the number of shares of common stock will be determined by reference to the corporation’s most recent periodic filings with the SEC during the Holding Period prior to the submission of the Eligible Stockholder’s Notice. The Required Shares must also be Owned continuously as of (i) the date on which the Nomination Notice is delivered to, or mailed and received at, the principal executive offices of the corporation in accordance with this Section 2.18; (ii) the record date for determining stockholders entitled to vote at the annual meeting; and (iii) the date of the annual meeting.

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(ii) Additional Requirements for Groups of Stockholders. If a group of stockholders aggregates Ownership of shares in order to meet the requirements under this Section 2.18, then (i) all shares held by each stockholder constituting their contribution to the Required Shares must have been held by that stockholder continuously for at least the Holding Period, and must also be Owned continuously as of (A) the date on which the Nomination Notice is delivered to, or mailed and received at, the principal executive offices of the corporation in accordance with this Section 2.18; (B) the record date for determining stockholders entitled to vote at the annual meeting; and (C) the date of the annual meeting; (ii) each provision in this Section 2.18 that requires the Eligible Stockholder to provide any written statements, representations, undertakings, agreements or other instruments or to meet any other conditions will be deemed to require each stockholder that is a member of such group to provide such statements, representations, undertakings, agreements or other instruments and to meet such other conditions (except that the members of such group may aggregate their stockholdings in order to meet the Required Shares); and (iii) a breach of any obligation, agreement or representation under this Section 2.18 by any member of such group will be deemed a breach by the Eligible Stockholder.

(h)    Information to be Provided by an Eligible Stockholder. Within the time period specified for providing the Nomination Notice, an Eligible Stockholder (which, for purposes of this Section 2.18(h), will be deemed to include any beneficial owner on whose behalf the nomination is made) making a nomination pursuant to this Section 2.18 must provide the following information in writing to the Secretary of the corporation at the principal executive offices of the corporation:

(i) the name and address of the Eligible Stockholder;

(ii) a statement by the Eligible Stockholder (A) setting forth and certifying as to the number of shares of common stock of the corporation that it Owns and has Owned continuously during Holding Period; (B) agreeing to continue to Own the Required Shares through the date of annual meeting; and (C) indicating whether it intends to continue to own the Required Shares for at least one year following the annual meeting (it being understood that this statement will not be deemed to impose any obligation on the Eligible Stockholder to hold any of the Required Shares following the annual meeting);

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(iii) in the case of a nomination by a group of stockholders that together is an Eligible Stockholder, (A) the designation by all group members of one group member that is authorized to receive communications, notices and inquiries from the corporation and to act on behalf of all such members with respect to the nomination and all related matters (including any withdrawal of the nomination); (B) the written acceptance by such group member of such designation; and (C) the address, phone number and email address of such group member,

(iv) one or more written statements from each record holder of the Required Shares (and from each intermediary through which the Required Shares are or have been held during the Holding Period) verifying that, as of a date within seven calendar days prior to the date that Nomination Notice is delivered or received at the principal executive offices of the corporation, the Eligible Stockholder then Owns, and has Owned continuously for the Holding Period, the Required Shares;

(v) an undertaking by the Eligible Stockholder to provide, within seven calendar days after (A) the record date for the annual meeting (if, prior to such record date, the corporation (1) has made disclosure of the record date in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the corporation with the SEC pursuant to Section 13, Section 14 or Section 15(d) of the 1934 Act; or (2) delivered a written notice (including by email) of the record date to the Eligible Stockholder) or (B) the date on which the corporation delivered to the Eligible Stockholder written notice (including by email) of the record date (if such notice is provided after the record date), one or more written statements from each record holder of the Required Shares (and from each intermediary through which the Required Shares are or have been held during the Holding Period) verifying the Eligible Stockholder’s continuous Ownership of the Required Shares through the record date;

(vi) in the case of a Qualifying Fund whose share Ownership is counted for purposes of qualifying as an Eligible Stockholder, documentation reasonably satisfactory to the board of directors that demonstrates that such Qualifying Fund meets the requirements of a Qualifying Fund;

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(vii) the information, agreements, certifications, representations and other documents required to be set forth in or included with a stockholder’s notice of a nomination pursuant to Section 2.4;

(viii) a copy of the Schedule 14N that has been or is concurrently being filed by such Eligible Stockholder with the SEC as required by Rule 14a-18 under the 1934 Act (or any successor rule);

(ix) a representation and undertaking that (A) the Eligible Stockholder (1) did not acquire, and is not holding, securities of the corporation for the purpose or with the effect of influencing or changing control of the corporation; (2) has not nominated, and will not nominate, for election to the board of directors at the annual meeting any person other than any Stockholder Nominees being nominated by it pursuant to this Section 2.18; (3) has not engaged, and will not engage, in, and has not and will not be a “participant” in another person’s, “solicitation” within the meaning of Rule 14a-1(l) under the 1934 Act (or any successor rule) in support of the election of any individual as a director at the annual meeting (other than its Stockholder Nominees or a nominee of the board of directors); (4) has not distributed, and will not distribute, to any stockholder any form of proxy for the annual meeting other than the form distributed by the corporation; (5) has complied, and will comply, with all laws, rules and regulations applicable to any actions taken pursuant to this Section 2.18, including the nomination of its Stockholder Nominees and any permissible solicitation in connection with the annual meeting; and (6) consents to the public disclosure of the information provided pursuant to this Section 2.18; and (B) the facts, statements and other information in all communications with the corporation and its stockholders by the Eligible Stockholder are, and will be, true and correct in all material respects and do not, and will not, omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading;

(x) an undertaking that the Eligible Stockholder agrees to (A) assume all liability stemming from any legal or regulatory violation arising out of the Eligible Stockholder’s communications with the stockholders of the corporation or out of the information that the Eligible Stockholder provides to the corporation; (B) indemnify and hold harmless the corporation and each of its

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directors, officers, employees, agents and affiliates individually against any liability, loss or damages in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against the corporation or any of its directors, officers, employees, agents or affiliates arising out of any nomination, solicitation or other activity by the Eligible Stockholder in connection with its efforts to elect any Stockholder Nominees pursuant to this Section 2.18; (C) comply with all requirements of this Section 2.18; and (D) upon request, provide to the corporation within five business days after such request, but in any event prior to the date of the annual meeting, such additional information as is reasonably requested by the corporation (including any information reasonably necessary to verify the Eligible Stockholder’s continuous Ownership of the Required Shares for the Holding Period and through the date of the annual meeting).

(i)    Representations and Agreement of any Stockholder Nominee.

(i) Materials Required to be Provided. Within the time period specified in this Section 2.18 for delivering the Nomination Notice, each Stockholder Nominee must deliver to the Secretary of the corporation a written representation and agreement that the Stockholder Nominee (A) other than as disclosed to the corporation, (1) is not, and will not become, a party to any agreement, arrangement or understanding with, and has not given, and will not give, any commitment or assurance to, any person or entity as to how such Stockholder Nominee, if elected as a director, will act or vote on any issue or question; and (2) is not, and will not become, a party to any agreement, arrangement or understanding with any person or entity other than the corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a Stockholder Nominee or director; (B) if elected, will comply with the corporation’s corporate governance guidelines, code of ethics, share ownership and trading policies and guidelines, and any other policies and guidelines of the corporation applicable to directors, as well as any applicable law, rule or regulation or listing requirement; (C) consents to being named in the corporation’s proxy statement for the annual meeting as a nominee of the applicable Eligible Stockholder or of the board of directors; (D) agrees to serve as a director if elected; (E) consents to the public disclosure of the information provided pursuant to this

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Section 2.18; and (F) represents that such Stockholder Nominee intends to serve as director of the corporation for the full term if so elected.

(ii) Additional Materials. At the written request of the corporation, the Stockholder Nominee must promptly, but in any event within five business days of such request, submit all (A) completed and signed questionnaires required of the corporation’s directors, nominees for director, and officers; and (B) additional information requested by the corporation (1) as may be reasonably necessary to permit the board of directors or any of its committees to determine if such Stockholder Nominee (a) is independent under the listing standards of the principal U.S. exchange upon which the corporation’s common stock is listed, any applicable rules of the SEC and any publicly disclosed standards used by the board of directors in determining and disclosing the independence of the corporation’s directors (collectively, the “Applicable Independence Standards”); (b) is eligible to serve as a director of the corporation; (c) has any direct or indirect relationship with the corporation; and (d) is not, and has not been, subject to any event specified in Item 401(f) of Regulation S-K promulgated under the Securities Act (or any successor rule) or any order of the type specified in Rule 506(d) of Regulation D promulgated under the Securities Act (or any successor rule); and (2) that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such Stockholder Nominee.

(j)    Supporting Statement. For each of its Stockholder Nominees, the Eligible Stockholder may provide to the Secretary of the corporation, within the time period specified for providing the Nomination Notice, a written statement, not to exceed 500 words, for inclusion in the corporation’s proxy statement for the annual meeting in support of the candidacy of such Stockholder Nominee (a “Supporting Statement”). No Supporting Statement may include any images, charts, pictures, graphic presentations or similar items.

(k)    True, Correct and Complete Information. If any information or communications provided by any Eligible Stockholder or Stockholder Nominee to the corporation or its stockholders is not, when provided, or thereafter ceases to be, true, correct and complete in all material respects (including omitting a material fact necessary to make the statements made, in light of the circumstances

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under which they were made, not misleading), then such Eligible Stockholder or Stockholder Nominee, as the case may be, must promptly notify the Secretary of the corporation in writing and provide the information that is required to make such information or communication true, correct, complete and not misleading. In addition, any person or entity providing any information to the corporation pursuant to this Section 2.18 must further update and supplement such information, if necessary, so that all such information is true and correct as of the record date for the annual meeting and as of the date that is 10 business days prior to the annual meeting or any adjournment, postponement or other delay thereof. Any update or supplement (or a written certification that no such updates or supplements are necessary and that the information previously provided remains true and correct as of the applicable date) pursuant to this Section 2.18(k) must be delivered to, or mailed and received by, the Secretary of the corporation at the principal executive offices of the corporation no later than (i) five business days after the record date for the annual meeting (in the case of any update and supplement required to be made as of the record date); and (ii) seven business days prior to the date of the annual meeting or any adjournment, postponement or other thereof (in the case of any update and supplement required to be made as of 10 business days prior to the annual meeting). No notification, update or supplement provided pursuant to this Section 2.18(k) or otherwise will be deemed to cure any defect in any previously provided information or communications or limit the remedies available to the corporation relating to any such defect (including the right to omit a Stockholder Nominee from its proxy materials).

(l)    Disqualifications and Exclusions of Stockholder Nominees.

(i) Bases for Disqualifying or Excluding Stockholder Nominees. Notwithstanding anything to the contrary in this Section 2.18, the corporation will not be required to include a Stockholder Nominee in its proxy materials (A) if the Eligible Stockholder who has nominated such Stockholder Nominee has engaged in or is currently engaged in, or has been or is a “participant” in another person’s, “solicitation” (within the meaning of Rule 14a-1(l) under the 1934 Act (or any successor rule)) in support of the election of any individual as a director at the annual meeting other than its Stockholder Nominees or a nominee of the board of directors; (B) who is not independent under the Applicable Independence Standards as of the date on which the Nomination Notice is delivered to, or

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mailed and received at, the principal executive offices of the corporation, as determined in good faith by the board of directors or any of its committees; (C) whose election as a member of the board of directors would cause the corporation to be in violation of these Bylaws, the Certificate of Incorporation, the rules and listing standards of the principal exchanges upon which the corporation’s shares of common stock are listed or traded, or any applicable law, rule or regulation; (D) who is or has been, within the past three years, an officer or director of a competitor, as defined in Section 8 of the Clayton Antitrust Act of 1914; (E) who is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in such a criminal proceeding within the past 10 years; (F) who is subject to any order of the type specified in Rule 506(d) of Regulation D promulgated under the Securities Act (or any successor rule); (G) if such Stockholder Nominee dies, becomes disabled or otherwise becomes ineligible for inclusion in the corporation’s proxy materials pursuant to this Section 2.18 or otherwise becomes unavailable for election at the annual meeting (including because such Stockholder Nominee is no longer willing to serve on the board of directors); (H) if such Stockholder Nominee or the Eligible Stockholder who has nominated such Stockholder Nominee has provided information to the corporation with respect to such nomination that was untrue in any material respect or omitted to state a material fact necessary in order to make the statement made, in light of the circumstances under which it was made, not misleading, as determined by the board of directors; (I) if such Stockholder Nominee, or the Eligible Stockholder who has nominated such Stockholder Nominee, otherwise contravenes any of the agreements or representations made by such Stockholder Nominee or Eligible Stockholder, as applicable, or fails to comply with its obligations pursuant to this Section 2.18; (J) if the Eligible Stockholder who has nominated such Stockholder Nominee ceases to be an Eligible Stockholder for any reason, including, but not limited to, not Owning the Required Shares through the date of the annual meeting; or (K) if such Stockholder Nominee and the Eligible Stockholder (or a representative thereof) or, in the case of a nomination by a group of stockholders, the representative designated by the group in accordance with Section 2.18(h)(iii), do not appear at the annual meeting to, applicable, present the Stockholder Nominee for election.

(ii) Process Following Disqualification or Exclusion. Following any determination in accordance with Section 2.18(l)(i), (A) the corporation will not be required to include in

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its proxy materials any successor or replacement nominee proposed by the applicable Eligible Stockholder or any other Eligible Stockholder; (B) to the extent feasible, the corporation may remove the information concerning a Stockholder Nominee and any related Supporting Statement (or portion thereof) from its proxy materials or otherwise communicate to its stockholders that such Stockholder Nominee will not be eligible for election at the annual meeting; and (C) the board of directors or the person presiding at the annual meeting will declare the nomination of such Stockholder Nominee to be invalid and such nomination will be disregarded notwithstanding that proxies in support of such Stockholder Nominee may have been received by the corporation.

(m)    Filing Obligation. The Eligible Stockholder (including any person or entity who Owns shares of common stock of the corporation that constitute part of the Ownership of such Eligible Stockholder for purposes of meeting the Required Shares) must file with the SEC any solicitation of the corporation’s stockholders relating to the annual meeting at which the Stockholder Nominee will be nominated, regardless of whether any such filing is required under Regulation 14A of the 1934 Act (or any successor rule) or whether any exemption from filing is available for such solicitation under Regulation 14A of the 1934 Act.

(n)    Omitted Disclosure by the Corporation. Notwithstanding anything to the contrary contained in this Section 2.18, the corporation may omit from its proxy materials any information or Supporting Statement (or portion thereof) that it, in good faith, believes (i) is not true in all material respects or omits a material statement necessary to make such information or Supporting Statement (or portion thereof) not misleading; (ii) directly or indirectly impugns the character, integrity or personal reputation of, or directly or indirectly makes charges concerning improper, illegal or immoral conduct or associations, without factual foundation, with respect to, any person; or (iii) violates any applicable law, rule, regulation or listing standard.

(o)    No Limitation on the Corporation. Nothing in this Section 2.18 will limit the corporation’s ability to (i) solicit against any Stockholder Nominee; (ii) include in its proxy materials its own statements or other information relating to any Eligible Stockholder or Stockholder Nominee

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(including any information provided to the corporation pursuant to this Section 2.18); or (iii) include in its proxy materials any Stockholder Nominee as a nominee of the board of directors.

(p)    Exclusive Method for Proxy Access. This Section 2.18 provides the exclusive method for a stockholder to include nominees for election to the board of directors in the corporation’s proxy materials.

ARTICLE III

DIRECTORS

3.1    Powers. Subject to the provisions of the General Corporation Law of Delaware and any limitations in the certificate of incorporation or these bylaws relating to action required to be approved by the stockholders or by the outstanding shares, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the board of directors.

3.2    Number of Directors. The number of directors of the corporation shall be seven (7). This number may be changed by a duly adopted amendment to the certificate of incorporation or by an amendment to this bylaw adopted by resolution of the board of directors or by the stockholders.

No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.

3.3    Election, Qualification and Term of Office of Directors. Except as provided in Section 3.4 of these bylaws, at each annual meeting of stockholders, directors of the corporation shall be elected to hold office until the expiration of the term for which they are elected, and until their successors have been duly elected and qualified; except that if any such election shall not be so held, such election shall take place at a stockholders' meeting called and held in accordance with the General Corporation Law of Delaware.

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Directors need not be stockholders unless so required by the certificate of incorporation or these bylaws, wherein other qualifications for directors may be prescribed.

Nominations for election to the board of directors of the corporation at an annual meeting of stockholders may be made by the board or on behalf of the board by a nominating committee appointed by the board, or by any stockholder of the corporation entitled to vote for the election of directors at such meeting. Such nominations, other than those made by or on behalf of the board, shall be made by notice in writing in accordance with Section 2.4(b) of these bylaws.

The chairman of the annual meeting may, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the foregoing procedure. If such determination and declaration is made, the defective nomination shall be disregarded.

3.4    Resignation and Vacancies. Any director may resign at any time upon written notice or electronic transmission to the corporation. When one or more directors so resigns and the resignation is effective at a future date, only a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided in this section in the filling of other vacancies.

Unless otherwise provided in the certificate of incorporation or these bylaws:

(i) Vacancies and newly created directorships resulting from any increase in the authorized number of directors elected by all of the stockholders having the right to vote as a single class may be filled only by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director.

(ii) Whenever the holders of any class or classes of stock or series thereof are entitled to elect one or more directors by the provisions of the certificate of incorporation, vacancies and newly created directorships of such class or classes or series may be filled only by a majority of the

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directors elected by such class or classes or series thereof then in office, or by a sole remaining director so elected.

If at any time, by reason of death or resignation or other cause, the corporation should have no directors in office, then any officer or any stockholder or an executor, administrator, trustee or guardian of a stockholder, or other fiduciary entrusted with like responsibility for the person or estate of a stockholder, may call a special meeting of stockholders in accordance with the provisions of the certificate of incorporation or these bylaws, or may apply to the Court of Chancery for a decree summarily ordering an election as provided in Section 211 of the General Corporation Law of Delaware.

If, at the time of filling any vacancy or any newly created directorship, the directors then in office constitute less than a majority of the whole board (as constituted immediately prior to any such increase), then the Court of Chancery may, upon application of any stockholder or stockholders holding at least ten (10) percent of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office as aforesaid, which election shall be governed by the provisions of Section 211 of the General Corporation Law of Delaware as far as applicable.

3.5    Place of Meetings; Meetings by Telephone. The board of directors of the corporation may hold meetings, both regular and special, either within or outside the State of Delaware.

Unless otherwise restricted by the certificate of incorporation or these bylaws, members of the board of directors, or any committee designated by the board of directors, may participate in a meeting of the board of directors, or any committee, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

3.6    Regular Meetings. Regular meetings of the board of directors shall be held at such place or places, on such date or dates, and at such time or times as shall have been established by the board of directors and publicized among all directors. A notice of each regular meeting shall not be required.

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3.7    Special Meetings; Notice. Special meetings of the board of directors for any purpose or purposes may be called at any time by the president or secretary of the corporation, or by any two of the directors then in office and shall be held at a place, on a date and at a time as such officer or such directors shall fix. Notice of the place, date and time of special meetings, unless waived, shall be given to each director by mailing written notice not less than two (2) days before the meeting or by sending a facsimile transmission or electronic mail containing the same not less than two (2) hours before the time of the holding of the meeting. If the circumstances warrant, notice may also be given personally or by telephone not less than two (2) hours before the time of the holding of the meeting. Oral notice given personally or by telephone may be communicated either to the director or to a person at the office of the director who the person giving the notice has reason to believe will promptly communicate it to the director. Unless otherwise indicated in the notice thereof, any and all business may be transacted at a special meeting.

3.8    Quorum. At all meetings of the board of directors, a majority of the authorized number of directors shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the board of directors, except as may be otherwise specifically provided by statute or by the certificate of incorporation. If a quorum is not present at any meeting of the board of directors, then the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.

A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for that meeting.

3.9    Waiver of Notice. Whenever notice is required to be given under any provision of the General Corporation Law of Delaware or of the certificate of incorporation or these bylaws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at

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the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors, or members of a committee of directors, need be specified in any written waiver of notice unless so required by the certificate of incorporation or these bylaws.

3.10    Adjourned Meeting; Notice. If a quorum is not present at any meeting of the board of directors, then the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.

3.11    Board Action by Written Consent Without a Meeting. Unless otherwise restricted by the certificate of incorporation or these bylaws, any action required or permitted to be taken at any meeting of the board of directors, or of any committee thereof, may be taken without a meeting if all members of the board or committee, as the case may be, consent thereto in writing or by electronic transmission and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the board or committee. Any person (whether or not then a director) may provide, whether through instruction to an agent or otherwise, that a consent to action will be effective at a future time (including a time determined upon the happening of an event), no later than sixty (60) days after such instruction is given or such provision is made and such consent shall be deemed to have been given for purposes of this Section 3.11 at such effective time so long as such person is then a director and did not revoke the consent prior to such time. Any such consent shall be revocable prior to its becoming effective.

3.12    Fees and Compensation of Directors. Unless otherwise restricted by the certificate of incorporation or these bylaws, the board of directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance of each meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings.

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3.13    Loans

(a)    No Loans to Directors or Executive Officers. To the extent provided under the Sarbanes-Oxley Act of 2002 and regulations promulgated thereunder, the corporation may not, directly or indirectly, including through any subsidiary, extend or maintain credit, arrange for the extension of credit, or renew an extension of credit, in the form of a personal loan, to, or for any director or executive officer (or equivalent thereof) in contravention of the Sarbanes-Oxley Act of 2002 and regulations promulgated thereunder.

(b)    Approval of Loans to Officers. Except as set forth in Section 3.13(a) above, the corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the corporation or of its subsidiaries, whenever, in the judgment of the directors, such loan, guaranty or assistance may reasonably be expected to benefit the corporation. The loan, guaranty or other assistance may be with or without interest and may be unsecured, or secured in such manner as the board of directors shall approve, including, without limitation, a pledge of shares of stock of the corporation. Nothing in this section contained shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the corporation at common law or under any statute.

3.14    Removal of Directors. Unless otherwise restricted by statute, by the certificate of incorporation or by these bylaws, any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors.

No reduction of the authorized number of directors shall have the effect of removing any director prior to the expiration of such director’s term of office.

3.15    Conduct of Business. At any meeting of the board of directors, business shall be transacted in such order and manner as the board may from time to time determine, and all matters shall be determined by the vote of a majority of the directors present, except as otherwise provided herein or required by law.

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3.16    Presumption of Assent. A director of the corporation who is present at a meeting of the board of directors at which action on any corporate matter is taken shall be conclusively presumed to have assented to the action taken unless his or her dissent shall be entered in the minutes of the meeting or unless he or she shall file his or her written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.

ARTICLE IV

COMMITTEES

4.1    Committees of Directors. The board of directors may, by resolution passed by a majority of the whole board, designate one or more committees, with each committee to consist of one or more of the directors of the corporation. The board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the board of directors or in the bylaws of the corporation, shall have and may exercise all the powers and authority of the board of directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers that may require it; but no such committee shall have the power or authority to (i) amend the certificate of incorporation (except that a committee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the board of directors as provided in Section 151(a) of the General Corporation Law of Delaware, fix the designation and any of the preferences or rights of such shares relating to dividends, redemption, dissolution, any distribution of assets of the corporation or the conversion into, or the exchange of such shares for, shares of any other class or classes or any other series of the same or any

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other class or classes of stock of the corporation or fix the number of shares of any series of stock or authorize the increase or decrease of the shares of any series), (ii) adopt an agreement of merger or consolidation under Section 251 or 252 of the General Corporation Law of Delaware, (iii) recommend to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets, (iv) recommend to the stockholders a dissolution of the corporation or a revocation of a dissolution, or (v) amend the bylaws of the corporation; and, unless the board resolution establishing the committee, a supplemental resolution of the board of directors, the bylaws or the certificate of incorporation expressly so provide, no such committee shall have the power or authority to declare a dividend, to authorize the issuance of stock, or to adopt a certificate of ownership and merger pursuant to Section 253 of the General Corporation Law of Delaware.

4.2    Committee Minutes. Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required.

4.3    Meetings and Action of Committees. Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of Article III of these bylaws, Section 3.5 (place of meetings and meetings by telephone), Section 3.6 (regular meetings), Section 3.7 (special meetings and notice), Section 3.8 (quorum), Section 3.9 (waiver of notice), Section 3.10 (adjournment and notice of adjournment), and Section 3.11 (action without a meeting), with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the board of directors and its members; provided, however, that the time of regular meetings of committees may be determined either by resolution of the board of directors or by resolution of the committee, that special meetings of committees may also be called by resolutions of the board of directors, and that notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The board of directors may adopt rules for the government of any committee not inconsistent with the provisions of these bylaws.

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ARTICLE V

OFFICERS

5.1    Officers. The officers of the corporation shall be a chief executive officer, a secretary, and a chief financial officer. The corporation may also have, at the discretion of the board of directors, a chairman of the board, a president, one or more vice presidents, one or more assistant secretaries, a controller, one or more assistant controllers, a treasurer, one or more assistant treasurers, and any such other officers as may be appointed in accordance with the provisions of Section 5.3 of these bylaws. Any number of offices may be held by the same person.

5.2    Appointment of Officers. The officers of the corporation, except such officers as may be appointed in accordance with the provisions of Section 5.3 or 5.5 of these bylaws, shall be appointed by the board of directors.

5.3    Subordinate Officers. The board of directors may appoint, or empower the chief executive officer or, in the absence of a chief executive officer, the president, to appoint, such other officers and agents as the business of the corporation may require, each of whom shall hold office for such period, have such authority, and perform such duties as are provided in these bylaws or as such chief executive officer or president, as applicable, or the board of directors may from time to time determine.

5.4    Removal and Resignation of Officers. Any officer may be removed, either with or without cause, by an affirmative vote of the majority of the board of directors at any regular or special meeting of the board or, except in the case of an officer chosen by the board of directors, by the chief executive officer or any other officer upon whom such power of removal may be conferred by the board of directors.

Any officer may resign at any time by giving written notice to the corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice; and, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective.

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5.5    Vacancies in Offices. Any vacancy occurring in any office of the corporation shall be filled in the manner prescribed in these bylaws for regular appointments to that office.

5.6    Chairman of the Board. The chairman of the board, if such an officer be elected, shall, if present, preside at meetings of the board of directors and exercise and perform such other powers and duties as may from time to time be assigned to him or her by the board of directors or as may be prescribed by these bylaws. If there is no chief executive officer or president, then the chairman of the board shall also be the chief executive officer of the corporation and shall have the powers and duties prescribed in Section 5.7 of these bylaws.

5.7    Chief Executive Officer. Subject to such supervisory powers, if any, as may be given by the board of directors to the chairman of the board, the chief executive officer of the corporation shall, subject to the control of the board of directors, have general supervision, direction, and control of the business and the officers of the corporation. He or she shall preside at all meetings of the stockholders and, in the absence or nonexistence of a chairman of the board, at all meetings of the board of directors. He or she shall have the general powers and duties of management usually vested in the office of the chief executive officer of a corporation and shall have such other powers and duties as may be prescribed by the board of directors or these bylaws.

5.8    President. Subject to the supervision, direction and control of the chief executive officer, if there be such an officer, the president shall have general supervision, direction, and control of the business and the officers of the corporation. He or she shall have the general powers and duties of management usually vested in the office of president of a corporation and shall have such other powers and duties as may be prescribed by the board of directors or these bylaws.

5.9    Vice Presidents. In the absence or disability of the president, the vice presidents, if any, in order of their rank as fixed by the board of directors or, if not ranked, a vice president designated by the board of directors, shall perform all the duties of the president and when so acting shall have all the powers of, and be subject to all the restrictions upon, the president. The vice presidents shall have such other powers and perform such other duties as from time to time may be prescribed for them respectively

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by the board of directors, these bylaws, the chief executive officer, the president or the chairman of the board.

5.10    Secretary. The secretary shall keep or cause to be kept, at the principal executive office of the corporation or such other place as the board of directors may direct, a book of minutes of all meetings and actions of directors, committees of directors, and stockholders. The minutes shall show the time and place of each meeting, whether regular or special (and, if special, how authorized and the notice given), the names of those present at directors’ meetings or committee meetings, the number of shares present or represented at stockholders’ meetings, and the proceedings thereof.

The secretary shall keep, or cause to be kept, at the principal executive office of the corporation or at the office of the corporation's transfer agent or registrar, as determined by resolution of the board of directors, a share register, or a duplicate share register, showing the names of all stockholders and their addresses, the number and classes of shares held by each, the number and date of certificates evidencing such shares, and the number and date of cancellation of every certificate surrendered for cancellation.

The secretary shall give, or cause to be given, notice of all meetings of the stockholders and of the board of directors required to be given by law or by these bylaws. He or she shall keep the seal of the corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the board of directors or by these bylaws.

5.11    Chief Financial Officer. The chief financial officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings, and shares. The books of account shall at all reasonable times be open to inspection by any director.

The chief financial officer shall deposit, or cause to be deposited, all money and other valuables in the name and to the credit of the corporation with such depositories as may be designated by the board of directors or the chief executive officer. He or she shall disburse, or cause to be disbursed, the funds of the corporation as may be ordered by the board of directors or the chief executive officer, shall render to

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the chief executive officer, the president and directors, whenever they request it, an account of all of his or her transactions as chief financial officer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the board of directors, the chief executive officer or these bylaws. The duties of the chief financial officer may be allocated by the board of directors or the chief executive officer among one or more persons, in its discretion.

5.12    Treasurer. The treasurer shall have such powers and discharge such duties relating to the financial aspects of the corporation's business as may be prescribed by the board of directors or the chief financial officer.

5.13    Assistant Secretary. The assistant secretary, or, if there is more than one, the assistant secretaries in the order determined by the stockholders or board of directors (or if there be no such determination, then in the order of their election) shall, in the absence of the secretary or in the event of his or her inability or refusal to act, perform the duties and exercise the powers of the secretary and shall perform such other duties and have such other powers as the board of directors or the stockholders may from time to time prescribe.

5.14    Assistant Treasurer. The assistant treasurer, or, if there is more than one, the assistant treasurers in the order determined by the stockholders or board of directors (or if there be no such determination, then in the order of their election), shall, in the absence of the treasurer or in the event of his or her inability or refusal to act, perform the duties and exercise the powers of the treasurer and shall perform such other duties and have such other powers as the board of directors or the stockholders may from time to time prescribe.

5.15    Authority and Duties of Officers. In addition to the foregoing authority and duties, all officers of the corporation shall respectively have such authority and perform such duties in the management of the business of the corporation as may be designated from time to time by the board of directors, the chief executive officer or the stockholders.

5.16     Representation of Shares of Other Corporations. The chairman of the board, the chief executive officer, the president, any vice president, the treasurer, the secretary or assistant secretary of this

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corporation, or any other person authorized by the board of directors, the chief executive officer or the president or a vice president, is authorized to vote, represent, and exercise on behalf of this corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of this corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.

ARTICLE VI

INDEMNITY

6.1    Indemnification of Directors and Officers. The corporation shall, to the maximum extent and in the manner permitted by the General Corporation Law of Delaware, indemnify each of its directors and executive officers against expenses (including attorneys' fees), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding, arising by reason of the fact that such person is or was an agent of the corporation. For purposes of this Section 6.1, a "director" or "executive officer" of the corporation includes any person (i) who is or was a director or executive officer of the corporation, (ii) who is or was serving at the request of the corporation as a director or executive officer of another corporation partnership, joint venture, trust or other enterprise, or (iii) who was a director or executive officer of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

6.2    Indemnification of Others. The corporation shall have the power, to the extent and in the manner permitted by the General Corporation Law of Delaware, to indemnify each of its employees and agents (other than directors and executive officers) against expenses (including attorney's fees), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding, arising by reason of the fact that such person is or was an agent of the corporation. For purposes of this Section 6.2, an "employee" or "agent" of the corporation (other than a director or executive officer) includes any person (i) who is or was an employee or agent of the corporation, (ii) who

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is or was serving at the request of the corporation as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was an employee or agent of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

6.3    Insurance. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of the General Corporation Law of Delaware.

ARTICLE VII

RECORDS AND REPORTS

7.1    Maintenance and Inspection of Records. The corporation shall, either at its principal executive office or at such place or places as designated by the board of directors, keep a record of its stockholders listing their names and addresses and the number and class of shares held by each stockholder, a copy of these bylaws as amended to date, accounting books, and other records.

7.2    Inspection by Directors. Any director shall have the right to examine the corporation's stock ledger, a list of its stockholders, and its other books and records for a purpose reasonably related to his or her position as a director. The Court of Chancery is hereby vested with the exclusive jurisdiction to determine whether a director is entitled to the inspection sought. The Court may summarily order the corporation to permit the director to inspect any and all books and records, the stock ledger, and the stock list and to make copies or extracts therefrom. The Court may, in its discretion, prescribe any limitations or conditions with reference to the inspection, or award such other and further relief as the Court may deem just and proper.

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ARTICLE VIII

MANNER OF GIVING NOTICE AND WAIVER

8.1    Notices. Except as otherwise specifically provided herein or required by law, all notices required to be given to any stockholder shall be in writing and may in every instance be effectively given by (i) hand delivery, (ii) mail, postage paid, or (iii) a form of electronic transmission consented to by the stockholder to whom the notice is given. Any such notice given by hand delivery or mail shall be addressed to such stockholder at his or her last known address as it appears on the books of the corporation. The time of the giving of the notice shall be the time when such notice shall be deemed received if hand delivered, or dispatched if sent by mail. Any such notice given by electronic transmission shall be deemed given:

(i) if by facsimile transmission, when directed to a number at which the stockholder has consented to receive notice;

(ii) if by electronic mail, when directed to an electronic mail address at which the stockholder has consented to receive notice;

(iii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and

(iv) if by any other form of electronic transmission, when directed to the stockholder.

An affidavit of the secretary or an assistant secretary or of the transfer agent or other agent of the corporation that the notice has been given by a form of electronic transmission shall, in the absence of fraud, be prima facie evidence of the facts stated therein.

41

Any such consent sent to a stockholder shall be revocable by the stockholder by written notice to the corporation. Any such consent shall be deemed revoked if:

(i) the corporation is unable to deliver by electronic transmission two consecutive notices given by the corporation in accordance with such consent; and

(ii) such inability becomes known to the secretary or an assistant secretary of the corporation or to the transfer agent, or other person responsible for the giving of notice.

However, the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action.

An "electronic transmission" means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved, and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.

Notice by a form of electronic transmission shall not apply to Sections 164, 296, 311, 312 or 324 of the General Corporation Law of Delaware.

8.2    Notice to Stockholders Sharing an Address. Except as otherwise prohibited under the General Corporation Law of Delaware, without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the corporation under the provisions of the General Corporation Law of Delaware, the certificate of incorporation or these bylaws shall be effective if given by a single written notice to stockholders who share an address if consented to by the stockholders at that address to whom such notice is given. Any such consent shall be revocable by the stockholder by written notice to the corporation. Any stockholder who fails to object in writing to the corporation, within 60 days of having been given written notice by the corporation of its intention to send the single notice, shall be deemed to have consented to receiving such single written notice.

8.3    Notice to Person with whom Communicating is Unlawful. Whenever notice is required to be given, under the General Corporation Law of Delaware, the certificate of incorporation or these

42

bylaws, to any person with whom communication is unlawful, the giving of such notice to such person shall not be required and there shall be no duty to apply to any governmental authority or agency for a license or permit to give such notice to such person. Any action or meeting which shall be taken or held without notice to any such person with whom communication is unlawful shall have the same force and effect as if such notice had been duly given. In the event that the action taken by the corporation is such as to require the filing of a certificate under the General Corporation Law of Delaware, the certificate shall state, if such is the fact and if notice is required, that notice was given to all persons entitled to receive notice except such persons with whom communication is unlawful.

8.4    Waiver of Notice. Whenever notice is required to be given under any provision of the General Corporation Law of Delaware, the certificate of incorporation or these bylaws, a written waiver, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time of the event for which notice is to be given, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the certificate of incorporation or these bylaws.

ARTICLE IX

GENERAL MATTERS

9.1    Checks. From time to time, the board of directors shall determine by resolution which person or persons may sign or endorse all checks, drafts, other orders for payment of money, notes or other evidences of indebtedness that are issued in the name of or payable to the corporation, and only the persons so authorized shall sign or endorse those instruments.

43

9.2    Execution of Corporate Contracts and Instruments. The board of directors, except as otherwise provided in these bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the corporation; such authority may be general or confined to specific instances. Unless so authorized or ratified by the board of directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

9.3    Stock Certificates; Partly Paid. The shares of a corporation shall be represented by certificates, provided that the board of directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the corporation. Notwithstanding the adoption of such a resolution by the board of directors, every holder of stock represented by certificates and upon request every holder of uncertificated shares shall be entitled to have a certificate signed by, or in the name of the corporation by any two authorized officers of the corporation representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.

The corporation may issue the whole or any part of its shares as partly paid and subject to call for the remainder of the consideration to be paid therefor. Upon the face or back of each stock certificate issued to represent any such partly paid shares, upon the books and records of the corporation in the case of uncertificated partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated. Upon the declaration of any dividend on fully paid shares, the corporation shall declare a dividend upon partly paid shares of the same class, but only upon the basis of the percentage of the consideration actually paid thereon.

44

9.4    Special Designation on Certificates. If the corporation is authorized to issue more than one class of stock or more than one series of any class, then the powers, the designations, the preferences, and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate that the corporation shall issue to represent such class or series of stock; provided, however, that, except as otherwise provided in Section 202 of the General Corporation Law of Delaware, in lieu of the foregoing requirements there may be set forth on the face or back of the certificate that the corporation shall issue to represent such class or series of stock a statement that the corporation will furnish without charge to each stockholder who so requests the powers, the designations, the preferences, and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Within a reasonable time after the issuance or transfer of uncertificated stock, the corporation shall send to the registered owner thereof a written notice containing the information required to be set forth or stated on certificates pursuant to this section 9.4 or Sections 156, 202(a) or 218(a) of the General Corporation Law of Delaware or with respect to this section 9.4 a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences or rights. Except as otherwise expressly provided by law, the rights and obligations of the holders of uncertificated stock and the rights and obligations of the holders of certificates representing stock of the same class and series shall be identical.

9.5    Lost Certificates. Except as provided in this Section 9.5, no new certificates for shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the corporation and cancelled at the same time. The corporation may issue a new certificate of stock or uncertificated shares in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate, or his or her legal representative, to give the corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.

45

9.6    Construction; Definitions. Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the General Corporation Law of Delaware shall govern the construction of these bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular, and the term "person" includes both a corporation and a natural person.

9.7    Dividends. The directors of the corporation, subject to any restrictions contained in (i) the General Corporation Law of Delaware or (ii) the certificate of incorporation, may declare and pay dividends upon the shares of its capital stock. Dividends may be paid in cash, in property, or in shares of the corporation's capital stock.

The directors of the corporation may set apart out of any of the funds of the corporation available for dividends a reserve or reserves for any proper purpose and may abolish any such reserve. Such purposes shall include but not be limited to equalizing dividends, repairing or maintaining any property of the corporation, and meeting contingencies.

9.8    Fiscal Year. The fiscal year of the corporation shall be fixed by resolution of the board of directors and may be changed by the board of directors.

9.9    Seal. The corporation may adopt a corporate seal, which may be altered at pleasure, and may use the same by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.

9.10    Transfer of Stock. Stock of the corporation shall be transferable in the manner prescribed by law and in these bylaws. Transfers of stock shall be made on the books of the corporation only by the record holder of such stock or by his or her attorney lawfully constituted in writing and, if such stock is certificated, upon the surrender of the certificate therefore to the corporation or the transfer agent of the corporation, which shall be canceled before a new certificate shall be issued. Any transfer shall be accompanied by proper evidence of succession, assignment or authority and upon receipt of such evidence and compliance with the other applicable provisions of these bylaws and applicable law, it shall be the duty of the corporation to record the transaction in its books.

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9.11    Stock Transfer Agreements. The corporation shall have power to enter into and perform any agreement with any number of stockholders of any one or more classes of stock of the corporation to restrict the transfer of shares of stock of the corporation of any one or more classes owned by such stockholders in any manner not prohibited by the General Corporation Law of Delaware.

9.12    Registered Stockholders. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends and to vote as such owner, shall be entitled to hold liable for calls and assessments the person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware.

ARTICLE X

AMENDMENTS

Any of these bylaws may be altered, amended or repealed by the affirmative vote of a majority of the board of directors or, with respect to bylaw amendments placed before the stockholders for approval and except as otherwise provided herein or required by law, by the affirmative vote of the holders of a majority of the shares of the corporation’s stock entitled to vote in the election of directors, voting as one class.

* * * * * *

47

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Steve Sanghi, certify that:

1.I have reviewed this Form 10-Q of Microchip Technology Incorporated;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and l5d-l5(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	February 4, 2021	/s/ Steve Sanghi
		Steve Sanghi
		Chief Executive Officer and Chairman of the Board

EX-31.2

Exhibit 31.2

CERTIFICATION

I, J. Eric Bjornholt, certify that:

1.I have reviewed this Form 10-Q of Microchip Technology Incorporated;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and l5d-l5(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	February 4, 2021	/s/ J. Eric Bjornholt
		J. Eric Bjornholt
		Senior Vice President and Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C.  SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Steve Sanghi, certify, pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Microchip Technology Incorporated on Form 10-Q for the period ended December 31, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Microchip Technology Incorporated.

By:	/s/ Steve Sanghi
Name:	Steve Sanghi
Title:	Chief Executive Officer and Chairman of the Board
Date:	February 4, 2021

I, J. Eric Bjornholt, certify, pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Microchip Technology Incorporated on Form 10-Q for the period ended December 31, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Microchip Technology Incorporated.

By:	/s/ J. Eric Bjornholt
Name:	J. Eric Bjornholt
Title:	Senior Vice President and Chief Financial Officer
Date:	February 4, 2021

XML

COVER PAGE - shares	9 Months Ended
	Dec. 31, 2020	Jan. 31, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Dec. 31, 2020
Document Transition Report	false
Entity File Number	0-21184
Entity Registrant Name	MICROCHIP TECHNOLOGY INCORPORATED
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	86-0629024
Entity Address, Address Line One	2355 W. Chandler Blvd.
Entity Address, City or Town	Chandler
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85224-6199
City Area Code	480
Local Phone Number	792-7200
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	MCHP
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		269,262,013
Entity Central Index Key	0000827054
Current Fiscal Year End Date	--03-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
ASSETS
Cash and cash equivalents	$ 370.7	$ 401.0
Short-term investments	2.0	2.0
Accounts receivable, net	893.8	934.0
Inventories	666.1	685.7
Other current assets	219.9	194.5
Total current assets	2,152.5	2,217.2
Property, plant and equipment, net	827.4	876.1
Goodwill	6,670.6	6,664.8
Intangible assets, net	5,025.8	5,702.3
Long-term deferred tax assets	1,628.4	1,748.5
Other assets	271.4	217.2
Total assets	16,576.1	17,426.1
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	259.8	246.8
Accrued liabilities	769.2	781.8
Current portion of long-term debt	1,493.2	608.8
Total current liabilities	2,522.2	1,637.4
Long-term debt	7,647.8	8,873.4
Long-term income tax payable	669.6	668.4
Long-term deferred tax liability	9.9	318.5
Other long-term liabilities	429.6	342.9
Stockholders' equity:
Preferred stock, $0.001 par value; authorized 5,000,000 shares; no shares issued or outstanding	0.0	0.0
Common stock, $0.001 par value; authorized 450,000,000 shares; 280,724,898 shares issued and 269,257,744 shares outstanding at December 31, 2020; 258,391,231 shares issued and 245,325,643 shares outstanding at March 31, 2020	0.3	0.2
Additional paid-in capital	2,385.1	2,675.1
Common stock held in treasury: 11,467,154 shares at December 31, 2020; 13,065,588 shares at March 31, 2020	(450.2)	(500.6)
Accumulated other comprehensive loss	(22.3)	(21.6)
Retained earnings	3,384.1	3,432.4
Total stockholders' equity	5,297.0	5,585.5
Total liabilities and stockholders' equity	$ 16,576.1	$ 17,426.1

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - $ / shares	Dec. 31, 2020	Mar. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	450,000,000	450,000,000
Common stock, shares issued (shares)	280,724,898	258,391,231
Common stock, shares outstanding (in shares)	269,257,744	245,325,643
Common stock held in treasury (in shares)	11,467,154	13,065,588

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Income Statement [Abstract]
Net sales	$ 1,352.1	$ 1,287.4	$ 3,971.3	$ 3,947.8
Cost of sales	506.3	501.9	1,519.3	1,519.6
Gross profit	845.8	785.5	2,452.0	2,428.2
Research and development	210.1	217.1	607.9	656.0
Selling, general and administrative	154.2	170.7	445.2	510.9
Amortization of acquired intangible assets	231.6	248.7	699.9	745.4
Special charges and other, net	4.3	17.8	8.9	29.5
Operating expenses	600.2	654.3	1,761.9	1,941.8
Operating income	245.6	131.2	690.1	486.4
Other income (expense):
Interest income	0.2	0.6	0.8	2.3
Interest expense	(86.5)	(119.7)	(278.9)	(381.9)
Loss on settlement of debt	(142.1)	0.0	(214.0)	(2.0)
Other loss, net	(0.4)	(1.5)	(2.9)	(0.2)
Income before income taxes	16.8	10.6	195.1	104.6
Income tax benefit	(19.4)	(300.5)	(38.3)	(366.1)
Net income	$ 36.2	$ 311.1	$ 233.4	$ 470.7
Basic net income per common share (in dollars per share)	$ 0.14	$ 1.30	$ 0.91	$ 1.97
Diluted net income per common share (in dollars per share)	0.13	1.20	0.87	1.84
Dividends declared per common share (in dollars per share)	$ 0.3685	$ 0.3665	$ 1.1040	$ 1.0980
Basic common shares outstanding (in shares)	263.4	239.2	255.7	238.5
Diluted common shares outstanding (in shares)	275.4	258.3	267.0	255.8

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 36.2	$ 311.1	$ 233.4	$ 470.7
Defined benefit plans:
Actuarial (losses) gains related to defined benefit pension plans, net of tax effect	(3.5)	(1.6)	(6.9)	0.1
Reclassification of realized transactions, net of tax effect	0.3	0.2	0.9	0.6
Change in net foreign currency translation adjustment	1.8	1.7	5.3	(0.7)
Other comprehensive (loss) income, net of tax effect	(1.4)	0.3	(0.7)	0.0
Comprehensive income	$ 34.8	$ 311.4	$ 232.7	$ 470.7

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net income	$ 233,400,000	$ 470,700,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	865,500,000	904,700,000
Deferred income taxes	(82,900,000)	(404,200,000)
Share-based compensation expense related to equity incentive plans	143,300,000	129,500,000
Loss on settlement of debt	214,000,000.0	2,000,000.0
Amortization of debt discount	57,500,000	90,900,000
Amortization of debt issuance costs	13,200,000	12,800,000
(Gains) losses on sale of assets	(900,000)	400,000
Impairment of intangible assets	0	500,000
Gains on equity investments	(200,000)	(1,000,000.0)
Other non-cash adjustment	900,000	2,700,000
Changes in operating assets and liabilities, excluding impact of acquisitions:
Decrease in accounts receivable	40,200,000	73,200,000
Decrease in inventories	17,500,000	5,600,000
Increase (decrease) in accounts payable and accrued liabilities	6,600,000	(53,300,000)
Change in other assets and liabilities	(23,300,000)	(3,900,000)
Change in income tax payable	(17,500,000)	(58,500,000)
Net cash provided by operating activities	1,467,300,000	1,172,100,000
Cash flows from investing activities:
Purchases of available-for-sale investments	0	(2,000,000.0)
Investments in other assets	(73,100,000)	(40,500,000)
Proceeds from sale of assets	200,000	500,000
Capital expenditures	(37,200,000)	(55,700,000)
Net cash used in investing activities	(110,100,000)	(97,700,000)
Cash flows from financing activities:
Payments on settlement of convertible debt	(2,252,200,000)	0
Proceeds from issuance of senior notes	3,577,800,000	0
Repayment of bridge loan facility	(615,000,000.0)	0
Deferred financing costs	(18,300,000)	(1,800,000)
Purchase of capped call options	(35,800,000)	0
Payment of cash dividends	(281,700,000)	(262,100,000)
Proceeds from sale of common stock	40,200,000	38,800,000
Tax payments related to shares withheld for vested restricted stock units	(46,500,000)	(50,200,000)
Capital lease payments	(600,000)	(600,000)
Net cash used in financing activities	(1,387,500,000)	(1,105,900,000)
Net decrease in cash and cash equivalents	(30,300,000)	(31,500,000)
Cash and cash equivalents, and restricted cash at beginning of period	401,000,000.0	428,600,000
Cash and cash equivalents, and restricted cash at end of period	370,700,000	397,100,000
Term Loan Facility
Cash flows from financing activities:
Repayments of loan facility	(1,723,500,000)	(188,000,000.0)
Revolving Credit Facility
Cash flows from financing activities:
Repayments of loan facility	(3,104,900,000)	(1,324,000,000.0)
Proceeds from borrowings on revolving loan under credit facility	$ 3,073,000,000.0	$ 682,000,000.0

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (PARENTHETICAL) - USD ($) shares in Millions, $ in Millions	1 Months Ended	9 Months Ended
	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2019
Supplemental disclosure of cash flow information:
Payments on settlement of convertible debt		$ 2,252.2	$ 0.0
Long-term Debt
Supplemental disclosure of cash flow information:
Extinguishment of debt, amount	$ 1,086.5
Payments on settlement of convertible debt	$ 428.9
Shares issued to settle convertible debt (in shares)	8.4
Long-term Debt | 2020 Senior Convertible Debt
Supplemental disclosure of cash flow information:
Debt conversion, converted instrument amount	$ 665.5

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Millions	Total	Common Stock and Additional Paid-in-Capital	Common Stock Held in Treasury	Accumulated Other Comprehensive Loss	Accumulated Other Comprehensive Loss Cumulative Effect, Period of Adoption, Adjustment	Retained Earnings	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment
Balance, common stock shares issued (in shares) at Mar. 31, 2019		253,200,000
Beginning balance at Mar. 31, 2019	$ 5,287.5	$ 2,679.8	$ (582.2)	$ (20.7)		$ 3,210.6
Beginning balance (Accounting Standards Update 2018-02) at Mar. 31, 2019					$ (1.3)		$ 1.3
Balance, common stock held in treasury (in shares) at Mar. 31, 2019			15,600,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	50.7					50.7
Other comprehensive income (loss)	(0.3)			(0.3)
Proceeds from sales of common stock through employee equity incentive plans (shares)		500,000
Proceeds from sales of common stock through employee equity incentive plans	7.3	$ 7.3
Restricted stock unit and stock appreciation right withholdings (shares)		(100,000)
Restricted stock unit and stock appreciation right withholdings	(11.4)	$ (11.4)
Treasury stock used for new issuances (shares)		(400,000)	(400,000)
Treasury stock used for new issuances	0.0	$ (13.8)	$ 13.8
Share-based compensation	41.6	$ 41.6
Cash dividend	(87.1)					(87.1)
Balance, common stock shares issued (in shares) at Jun. 30, 2019		253,200,000
Ending balance at Jun. 30, 2019	5,288.3	$ 2,703.5	$ (568.4)	(22.3)		3,175.5
Balance, common stock held in treasury (in shares) at Jun. 30, 2019			15,200,000
Balance, common stock shares issued (in shares) at Mar. 31, 2019		253,200,000
Beginning balance at Mar. 31, 2019	5,287.5	$ 2,679.8	$ (582.2)	(20.7)		3,210.6
Beginning balance (Accounting Standards Update 2018-02) at Mar. 31, 2019					$ (1.3)		$ 1.3
Balance, common stock held in treasury (in shares) at Mar. 31, 2019			15,600,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	470.7
Other comprehensive income (loss)	0.0
Balance, common stock shares issued (in shares) at Dec. 31, 2019		253,200,000
Ending balance at Dec. 31, 2019	5,616.6	$ 2,738.9	$ (520.8)	(22.0)		3,420.5
Balance, common stock held in treasury (in shares) at Dec. 31, 2019			13,700,000
Balance, common stock shares issued (in shares) at Jun. 30, 2019		253,200,000
Beginning balance at Jun. 30, 2019	5,288.3	$ 2,703.5	$ (568.4)	(22.3)		3,175.5
Balance, common stock held in treasury (in shares) at Jun. 30, 2019			15,200,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	108.9					108.9
Other comprehensive income (loss)	0.0			0.0
Proceeds from sales of common stock through employee equity incentive plans (shares)		900,000
Proceeds from sales of common stock through employee equity incentive plans	20.2	$ 20.2
Restricted stock unit and stock appreciation right withholdings (shares)		(200,000)
Restricted stock unit and stock appreciation right withholdings	(15.2)	$ (15.2)
Treasury stock used for new issuances (shares)		(700,000)	(700,000)
Treasury stock used for new issuances	0.0	$ (23.2)	$ 23.2
Share-based compensation	46.4	$ 46.4
Cash dividend	(87.3)					(87.3)
Balance, common stock shares issued (in shares) at Sep. 30, 2019		253,200,000
Ending balance at Sep. 30, 2019	5,361.3	$ 2,731.7	$ (545.2)	(22.3)		3,197.1
Balance, common stock held in treasury (in shares) at Sep. 30, 2019			14,500,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	311.1					311.1
Other comprehensive income (loss)	0.3			0.3
Proceeds from sales of common stock through employee equity incentive plans (shares)		1,000,000.0
Proceeds from sales of common stock through employee equity incentive plans	11.3	$ 11.3
Restricted stock unit and stock appreciation right withholdings (shares)		(200,000)
Restricted stock unit and stock appreciation right withholdings	(23.6)	$ (23.6)
Treasury stock used for new issuances (shares)		(800,000)	(800,000)
Treasury stock used for new issuances	0.0	$ (24.4)	$ 24.4
Share-based compensation	43.9	$ 43.9
Cash dividend	(87.7)					(87.7)
Balance, common stock shares issued (in shares) at Dec. 31, 2019		253,200,000
Ending balance at Dec. 31, 2019	$ 5,616.6	$ 2,738.9	$ (520.8)	(22.0)		3,420.5
Balance, common stock held in treasury (in shares) at Dec. 31, 2019			13,700,000
Balance, common stock shares issued (in shares) at Mar. 31, 2020	258,391,231	258,400,000
Beginning balance at Mar. 31, 2020	$ 5,585.5	$ 2,675.3	$ (500.6)	(21.6)		3,432.4
Balance, common stock held in treasury (in shares) at Mar. 31, 2020	13,065,588		13,100,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 123.6					123.6
Other comprehensive income (loss)	0.5			0.5
Proceeds from sales of common stock through employee equity incentive plans (shares)		600,000
Proceeds from sales of common stock through employee equity incentive plans	11.0	$ 11.0
Restricted stock unit and stock appreciation right withholdings (shares)		(100,000)
Restricted stock unit and stock appreciation right withholdings	(11.0)	$ (11.0)
Treasury stock used for new issuances (shares)		(500,000)	(500,000)
Treasury stock used for new issuances	0.0	$ (14.8)	$ 14.8
Shares issued to settle convertible debt (in shares)		6,600,000
Shares issued to settle convertible debt	651.5	$ 651.5
Settlement of convertible debt	(810.7)	(810.7)
Share-based compensation	41.3	$ 41.3
Cash dividend	(90.4)					(90.4)
Balance, common stock shares issued (in shares) at Jun. 30, 2020		265,000,000.0
Ending balance at Jun. 30, 2020	$ 5,501.3	$ 2,542.6	$ (485.8)	(21.1)		3,465.6
Balance, common stock held in treasury (in shares) at Jun. 30, 2020			12,600,000
Balance, common stock shares issued (in shares) at Mar. 31, 2020	258,391,231	258,400,000
Beginning balance at Mar. 31, 2020	$ 5,585.5	$ 2,675.3	$ (500.6)	(21.6)		3,432.4
Balance, common stock held in treasury (in shares) at Mar. 31, 2020	13,065,588		13,100,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 233.4
Other comprehensive income (loss)	$ (0.7)
Balance, common stock shares issued (in shares) at Dec. 31, 2020	280,724,898	280,700,000
Ending balance at Dec. 31, 2020	$ 5,297.0	$ 2,385.4	$ (450.2)	(22.3)		3,384.1
Balance, common stock held in treasury (in shares) at Dec. 31, 2020	11,467,154		11,500,000
Balance, common stock shares issued (in shares) at Jun. 30, 2020		265,000,000.0
Beginning balance at Jun. 30, 2020	$ 5,501.3	$ 2,542.6	$ (485.8)	(21.1)		3,465.6
Balance, common stock held in treasury (in shares) at Jun. 30, 2020			12,600,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	73.6					73.6
Other comprehensive income (loss)	0.2			0.2
Proceeds from sales of common stock through employee equity incentive plans (shares)		700,000
Proceeds from sales of common stock through employee equity incentive plans	18.6	$ 18.6
Restricted stock unit and stock appreciation right withholdings (shares)		(100,000)
Restricted stock unit and stock appreciation right withholdings	(14.4)	$ (14.4)
Treasury stock used for new issuances (shares)		(600,000)	(600,000)
Treasury stock used for new issuances	0.0	$ (18.8)	$ 18.8
Shares issued to settle convertible debt (in shares)		7,300,000
Shares issued to settle convertible debt	768.7	$ 768.7
Settlement of convertible debt	(859.4)	(859.4)
Share-based compensation	50.4	$ 50.4
Cash dividend	(95.3)					(95.3)
Balance, common stock shares issued (in shares) at Sep. 30, 2020		272,300,000
Ending balance at Sep. 30, 2020	5,443.7	$ 2,487.7	$ (467.0)	(20.9)		3,443.9
Balance, common stock held in treasury (in shares) at Sep. 30, 2020			12,000,000.0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	36.2					36.2
Other comprehensive income (loss)	(1.4)			(1.4)
Proceeds from sales of common stock through employee equity incentive plans (shares)		700,000
Proceeds from sales of common stock through employee equity incentive plans	10.6	$ 10.6
Restricted stock unit and stock appreciation right withholdings (shares)		(200,000)
Restricted stock unit and stock appreciation right withholdings	(21.1)	$ (21.1)
Treasury stock used for new issuances (shares)		(500,000)	(500,000)
Treasury stock used for new issuances	0.0	$ (16.8)	$ 16.8
Shares issued to settle convertible debt (in shares)		8,400,000
Shares issued to settle convertible debt	1,160.1	$ 1,160.1
Settlement of convertible debt	(1,339.0)	(1,339.0)
Purchase of capped call options	(35.8)	(35.8)
Issuance of 2020 Senior Convertible Debt	87.7	87.7
Share-based compensation	52.0	$ 52.0
Cash dividend	$ (96.0)					(96.0)
Balance, common stock shares issued (in shares) at Dec. 31, 2020	280,724,898	280,700,000
Ending balance at Dec. 31, 2020	$ 5,297.0	$ 2,385.4	$ (450.2)	$ (22.3)		$ 3,384.1
Balance, common stock held in treasury (in shares) at Dec. 31, 2020	11,467,154		11,500,000

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Basis of Presentation	9 Months Ended
	Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Microchip Technology Incorporated and its majority-owned and controlled subsidiaries (the Company).  All significant intercompany accounts and transactions have been eliminated in consolidation. All dollar amounts in the financial statements and tables in these notes, except per share amounts, are stated in millions of U.S. dollars unless otherwise noted.The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP, pursuant to the rules and regulations of the SEC.  The information furnished herein reflects all adjustments which are, in the opinion of management, of a normal recurring nature and necessary for a fair statement of the results for the interim periods reported. Certain information and footnote disclosures normally included in audited consolidated financial statements have been condensed or omitted pursuant to such SEC rules and regulations.  It is suggested that these condensed consolidated financial statements be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2020.  The results of operations for the three and nine months ended December 31, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2021 or for any other period.

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Recently Issued Accounting Pronouncements

9 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

On April 1, 2020, the Company adopted the following Accounting Standards Updates, none of which had a material impact on its consolidated financial statements.

Accounting Standards Updates	Description
ASU 2018-15	Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract
ASU 2018-13	Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement
ASU 2017-04	Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment
ASU 2016-13	Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

Recently Issued Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity, which simplifies the guidance for certain convertible debt instruments by removing the separation models for convertible debt with a cash conversion feature or convertible instruments with a beneficial conversion feature. As a result, convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. Additionally, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company expects the primary impacts of this new standard will be to increase the carrying value of its Convertible Debt and reduce its reported interest expense. In addition, the Company will be required to use the if-converted method for calculating diluted earnings per share. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04-Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions to U.S. GAAP for applying guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The guidance is effective upon issuance and may be adopted on any date on or after March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12-Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This guidance enhances and simplifies various aspects of the income tax accounting standard ASC 740, including requirements related to hybrid tax regimes, the tax basis step-up in goodwill obtained in a transaction that is not a business combination, separate financial statements of entities not subject to tax, the intraperiod tax allocation exception to the incremental approach, ownership changes in investments, interim-period accounting for enacted changes in tax law, and the year-to-date loss limitation in interim-period tax accounting. The amendments are effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

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Segment Information

9 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company's reportable segments are semiconductor products and technology licensing.  The Company does not allocate operating expenses, interest income, interest expense, other income or expense, or provision for or benefit from income taxes to these segments for internal reporting purposes, as the Company does not believe that allocating these expenses is beneficial in evaluating segment performance.  Additionally, the Company does not allocate assets to segments for internal reporting purposes as it does not manage its segments by such metrics.

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2020 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2020				December 31, 2020
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,319.9	$	813.6	$	3,893.9	$	2,374.6
Technology licensing	32.2		32.2		77.4		77.4
Total	$	1,352.1	$	845.8	$	3,971.3	$	2,452.0

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2019 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2019				December 31, 2019
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,257.0	$	755.1	$	3,875.6	$	2,356.0
Technology licensing	30.4		30.4		72.2		72.2
Total	$	1,287.4	$	785.5	$	3,947.8	$	2,428.2

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Net Sales

9 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Net Sales

Net Sales

The following table represents the Company's net sales by product line (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Microcontrollers	$	726.3	$	685.8	$	2,145.8	$	2,091.8
Analog	372.8		363.3		1,104.7		1,143.6
FPGA	99.1		92.6		294.3		276.8
LMO	153.9		145.7		426.5		435.6
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

The product lines listed above are included entirely in the Company's semiconductor product segment with the exception of the LMO product line, which includes products from both the semiconductor product and technology licensing segments.

The following table represents the Company's net sales by contract type (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Distributors	$	681.6	$	638.8	$	2,003.7	$	1,970.0
Direct customers	638.3		618.2		1,890.2		1,905.6
Licensees	32.2		30.4		77.4		72.2
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

Distributors are customers that buy products with the intention of reselling them. Distributors generally have a distributor agreement with the Company to govern the terms of the relationship. Direct customers are non-distributor customers, which generally do not have a master sales agreement with the Company. The Company's direct customers primarily consist of OEMs and, to a lesser extent, contract manufacturers. Licensees are customers of the Company's technology licensing segment, which include purchasers of intellectual property and customers that have licensing agreements to use the Company's SuperFlash® embedded flash and Smartbits® one time programmable NVM technologies. All of the contract types listed in the table above are included in the Company's semiconductor product segment with the exception of licenses, which is included in the technology licensing segment.

Substantially all of the Company's net sales are recognized from contracts with customers.

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Net Income Per Common Share

9 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Net Income Per Common Share

Net Income Per Common Share

The following table sets forth the computation of basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net income	$	36.2	$	311.1	$	233.4	$	470.7
Basic weighted average common shares outstanding	263.4		239.2		255.7		238.5
Dilutive effect of stock options and RSUs	3.7		3.4		3.4		3.5
Dilutive effect of 2015 Senior Convertible Debt	3.5		15.2		5.4		13.6
Dilutive effect of 2017 Senior Convertible Debt	2.8		0.3		1.5		0.1
Dilutive effect of 2020 Senior Convertible Debt	—		—		—		—
Dilutive effect of 2017 Junior Convertible Debt	2.0		0.2		1.0		0.1
Diluted weighted average common shares outstanding	275.4		258.3		267.0		255.8
Basic net income per common share	$	0.14	$	1.30	$	0.91	$	1.97
Diluted net income per common share	$	0.13	$	1.20	$	0.87	$	1.84

The Company computed basic net income per common share based on the weighted average number of common shares outstanding during the period. The Company computed diluted net income per common share based on the weighted average number of common shares outstanding plus potentially dilutive common shares outstanding during the period.

Potentially dilutive common shares from employee equity incentive plans are determined by applying the treasury stock method to the assumed exercise of outstanding stock options and the assumed vesting of outstanding RSUs. Weighted average common shares exclude the effect of option shares which are not dilutive.  There were no anti-dilutive option shares for each of the three and nine months ended December 31, 2020 and 2019.

The Company's Convertible Debt has no impact on diluted net income per common share unless the average price of the Company's common stock exceeds the conversion price because the Company intends to settle the principal amount of the Convertible Debt in cash upon conversion.  Prior to conversion, the Company will include, in the diluted net income per common share calculation, the effect of the additional shares that may be issued when the Company's common stock price exceeds the conversion price using the treasury stock method.  The following is the weighted average conversion price per share used in calculating the dilutive effect (see Note 6 for details on the Convertible Debt):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
2015 Senior Convertible Debt	$	60.78	$	61.67	$	60.99	$	61.92
2017 Senior Convertible Debt	$	94.78	$	96.16	$	95.11	$	96.56
2020 Senior Convertible Debt	$	186.87	$	—	$	186.87	$	—
2017 Junior Convertible Debt	$	93.12	$	94.48	$	93.44	$	94.87

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Debt

9 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Debt

Debt

Debt obligations included in the condensed consolidated balance sheets consisted of the following (in millions):

	Coupon Interest Rate	Effective Interest Rate	Fair Value of Liability Component at Issuance (1)
				December 31,		March 31,
				2020		2020
Senior Secured Indebtedness
Revolving Credit Facility				$	2,356.6	$	2,388.5
Term Loan Facility				—		1,723.5
Bridge Loan Facility				—		615.0
3.922% 2021 Notes	3.922%	4.5%		1,000.0		1,000.0
4.333% 2023 Notes	4.333%	4.7%		1,000.0		1,000.0
2.670% 2023 Notes	2.670%	2.8%		1,000.0		—
0.972% 2024 Notes	0.972%	1.1%		1,400.0		—
Senior Unsecured Indebtedness
4.250% 2025 Notes	4.250%	4.6%		1,200.0		—
Total Senior Indebtedness				7,956.6		6,727.0
Senior Subordinated Convertible Debt - Principal Outstanding
2015 Senior Convertible Debt	1.625%	5.9%	$188.5	222.4		1,110.0
2017 Senior Convertible Debt	1.625%	6.0%	$353.6	455.5		2,070.0
2020 Senior Convertible Debt	0.125%	5.1%	$555.5	665.5		—
Junior Subordinated Convertible Debt - Principal Outstanding
2017 Junior Convertible Debt	2.250%	7.4%	$144.5	278.6		686.3
Total Convertible Debt				1,622.0		3,866.3
Gross long-term debt including current maturities				9,578.6		10,593.3
Less: Debt discount (2)				(399.6)		(1,043.2)
Less: Debt issuance costs (3)				(38.0)		(67.9)
Net long-term debt including current maturities				9,141.0		9,482.2
Less: Current maturities (4)				(1,493.2)		(608.8)
Net long-term debt				$	7,647.8	$	8,873.4

(1) As each of the convertible debt instruments may be settled in cash upon conversion, for accounting purposes, they were bifurcated into a liability component and an equity component, which are both initially recorded at fair value.  The amount allocated to the equity component is the difference between the principal value of the instrument and the fair value of the liability component at issuance.  The resulting debt discount is being amortized to interest expense at the respective effective interest rate over the contractual term of the debt.

(2) The unamortized discount consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Bridge Loan Facility	$	—	$	(3.1)
3.922% 2021 Notes	(0.8)		(2.1)
4.333% 2023 Notes	(2.7)		(3.5)
2.670% 2023 Notes	(2.5)		—
0.972% 2024 Notes	(4.1)		—
4.250% 2025 Notes	(13.5)		—
2015 Senior Convertible Debt	(33.3)		(192.9)
2017 Senior Convertible Debt	(100.9)		(504.2)
2020 Senior Convertible Debt	(108.0)		—
2017 Junior Convertible Debt	(133.8)		(337.4)
Total unamortized discount	$	(399.6)	$	(1,043.2)

(3) Debt issuance costs consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Revolving Credit Facility	$	(11.1)	$	(14.6)
Term Loan Facility	—		(14.6)
Bridge Loan Facility	—		(3.1)
3.922% 2021 Notes	(1.7)		(4.8)
4.333% 2023 Notes	(5.9)		(7.7)
2.670% 2023 Notes	(1.4)		—
0.972% 2024 Notes	(2.2)		—
4.250% 2025 Notes	(1.8)		—
2015 Senior Convertible Debt	(1.2)		(7.0)
2017 Senior Convertible Debt	(2.6)		(13.0)
2020 Senior Convertible Debt	(8.9)		—
2017 Junior Convertible Debt	(1.2)		(3.1)
Total debt issuance costs	$	(38.0)	$	(67.9)

(4) As of December 31, 2020, current maturities consist of the liability component of the 2017 Senior Convertible Debt and the 2017 Junior Convertible Debt, and the 3.922% 2021 Notes which are due June 1, 2021. As of March 31, 2020, current maturities included the Bridge Loan Facility.

Expected maturities relating to the Company’s debt obligations as of December 31, 2020 are as follows (in millions):

Fiscal year ending March 31,	Expected Maturities
2021	$	—
2022	1,000.0
2023	—
2024	5,756.6
2025	887.9
Thereafter	1,934.1
Total	$	9,578.6

Ranking of Convertible Debt - The Convertible Debt are unsecured obligations which are subordinated in right of payment to the amounts outstanding under the Company's Senior Indebtedness. The Junior Subordinated Convertible Debt is expressly subordinated in right of payment to any existing and future senior debt of the Company (including the Senior Indebtedness and the Senior Subordinated Convertible Debt) and is structurally subordinated in right of payment to the liabilities of the Company's subsidiaries.  The Senior Subordinated Convertible Debt is subordinated to the Senior Indebtedness; ranks senior to the Company's indebtedness that is expressly subordinated in right of payment to it, including the Junior Subordinated Convertible Debt; ranks equal in right of payment to any of the Company's unsubordinated indebtedness that does not provide

that it is senior to the Senior Subordinated Convertible Debt; ranks junior in right of payment to any of the Company's secured and unsecured unsubordinated indebtedness to the extent of the value of the assets securing such indebtedness; and is structurally subordinated to all indebtedness and other liabilities of the Company's subsidiaries.

Summary of Conversion Features - Each series of Convertible Debt is convertible, subject to certain conditions, into cash, shares of the Company's common stock or a combination thereof, at the Company's election, at specified conversion rates (see table below), adjusted for certain events including the declaration of cash dividends. Except during the three-month period immediately preceding the maturity date of the applicable series of Convertible Debt, each series of Convertible Debt is convertible only upon the occurrence of (i) such time as the closing price of the Company's common stock exceeds the conversion price (see table below) by 130% for 20 days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter or (ii) during the 5 business day period after any 10 consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day or (iii) upon the occurrence of certain corporate events specified in the indenture of such series of Convertible Debt. In addition, for each series, if at the time of conversion the applicable price of the Company's common stock exceeds the applicable conversion price at such time, the applicable conversion rate will be increased by up to an additional maximum incremental shares rate, as determined pursuant to a formula specified in the indenture for the applicable series of Convertible Debt, and as adjusted for cash dividends paid since the issuance of such series of Convertible Debt. However, in no event will the applicable conversion rate exceed the applicable maximum conversion rate specified in the indenture for the applicable series of Convertible Debt (see table below).

The following table sets forth the applicable conversion rates adjusted for dividends declared since issuance of such series of Convertible Debt and the applicable incremental share factors and maximum conversion rates as adjusted for dividends paid since the applicable issuance date:

	Dividend adjusted rates as of December 31, 2020
	Conversion Rate	Approximate Conversion Price		Incremental Share Factor	Maximum Conversion Rate
2015 Senior Convertible Debt (1)	16.4786	$	60.68	8.2393	23.0700
2017 Senior Convertible Debt (1)	10.5670	$	94.63	5.2835	15.0581
2020 Senior Convertible Debt (1)	5.3514	$	186.87	—	7.4919
2017 Junior Convertible Debt (1)	10.7558	$	92.97	5.3779	15.0581

(1) As of December 31, 2020, the 2020 Senior Convertible Debt was not convertible. As of December 31, 2020, the holders of the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt have the right to convert their notes between January 1, 2021 and March 31, 2021 because the Company's common stock price has exceeded the applicable conversion price for such series by 130% for the specified period of time during the quarter ended December 31, 2020. As of December 31, 2020, the adjusted conversion rate for the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt would be increased to 21.0976 shares of common stock, 12.2303 shares of common stock, and 12.5134 shares of common stock, respectively, per $1,000 principal amount of notes based on the closing common stock price of $138.11 to include an additional maximum incremental share rate per the terms of the applicable indenture. As of December 31, 2020, the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt had a conversion value in excess of par of $425.6 million, $313.9 million, and $202.9 million, respectively.

With the exception of the 2020 Senior Convertible Debt, which may be redeemed by the Company on or after November 20, 2022, the Company may not redeem any series of Convertible Debt prior to the relevant maturity date and no sinking fund is provided for any series of Convertible Debt. Under the terms of the applicable indenture, the Company may repurchase any series of Convertible Debt in the open market through privately negotiated exchange offers. Upon the occurrence of a fundamental change, as defined in the applicable indenture of such series of Convertible Debt, holders of such series may require the Company to purchase all or a portion of their Convertible Debt for cash at a price equal to 100% of the principal amount plus any accrued and unpaid interest.

Interest expense consists of the following (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Debt issuance amortization	$	3.7	$	3.3	$	11.5	$	9.9
Debt discount amortization	1.6		0.7		4.7		2.1
Interest expense	59.2		64.1		171.3		217.7
Total interest expense on Senior Indebtedness	64.5		68.1		187.5		229.7
Debt issuance amortization	0.5		1.0		1.7		2.9
Debt discount amortization	12.8		30.0		52.8		88.8
Coupon interest expense	7.8		19.3		33.9		57.9
Total interest expense on Convertible Debt	21.1		50.3		88.4		149.6
Other interest expense	0.9		1.3		3.0		2.6
Total interest expense	$	86.5	$	119.7	$	278.9	$	381.9

The remaining period over which the unamortized debt discount will be recognized as non-cash interest expense is 4.1 years, 6.1 years, 3.9 years, and 16.1 years for the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, 2020 Senior Convertible Debt, and 2017 Junior Convertible Debt, respectively.  

In December 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, approximately (i) $90.0 million principal amount of its 2015 Senior Convertible Debt for $48.5 million in cash and 1.6 million shares of the Company's common stock valued at $221.0 million for total consideration of $269.6 million, of which $79.4 million was allocated to the fair value of the liability component and $184.5 million was allocated to the reacquisition of the equity component, (ii) $588.8 million principal amount of its 2017 Senior Convertible Debt for $155.4 million in cash, 3.0 million shares of the Company's common stock valued at $408.7 million, and $601.5 million principal amount of 2020 Senior Convertible Debt, for a total consideration of $1.20 billion, of which $486.7 million was allocated to the fair value of the liability component and $655.3 million was allocated to the reacquisition of the equity component, and (iii) $407.7 million principal amount of its 2017 Junior Convertible Debt for $225.0 million in cash, 3.8 million shares of the Company's common stock valued at $530.4 million, and $64.0 million principal amount of 2020 Senior Convertible Debt, for total consideration of $819.4 million, of which $246.3 million was allocated to the fair value of the liability component and $547.1 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $129.2 million. The Company used borrowings under its Revolving Credit Facility to finance a portion of its 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt settlement transactions. In connection with the issuance of the 2020 Senior Convertible Debt, the Company incurred issuance costs of $10.8 million, of which $9.0 million was recorded as debt issuance costs and will be amortized using the effective interest method over the term of the debt. The remainder of $1.8 million in fees was recorded to equity. The debt discount on the 2020 Senior Convertible Debt was the difference between the par value and the fair value of the debt resulting in a debt discount of $110.0 million which will be amortized to interest expense using the effective interest method over the term of the debt. Interest on the 2020 Senior Convertible Debt is payable semi-annually in arrears on May 15 and November 15 of each year. The Company also issued $1.40 billion aggregate principal amount of 0.972% 2024 Notes and used the proceeds in addition to $213.0 million in borrowings under its Revolving Credit Facility, and cash on hand to repay all amounts outstanding under its Term Loan Facility resulting in a net loss on settlement of debt of $12.9 million consisting of unamortized financing fees.

In connection with the issuance of the 2020 Senior Convertible Debt, the Company entered into capped call option transactions with several financial institutions at a cost of $35.8 million. The capped call options cover, subject to anti-dilution adjustments, the number of shares of the Company’s common stock initially underlying the 2020 Senior Convertible Debt. Upon conversion of the 2020 Senior Convertible Debt, the Company may exercise the capped call options subject to a cap strike price of $233.58 per share which would reduce the potential dilution to the Company’s common stock or offset any cash payments the Company is required to make in excess of the principal amount of converted notes. Upon conversion of the 2020 Senior Convertible Debt, there will be no economic dilution from the notes until the average market price of the Company’s common stock exceeds the cap price of $233.58 per share as the exercise of the capped call options will offset any dilution from the 2020 Senior Convertible Debt from the conversion price up to the cap price. As these transactions meet certain accounting criteria, the capped call options are recorded as a reduction of stockholders' equity and are not accounted for as derivatives.

In August 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, (i) $414.3 million aggregate principal amount of its 2015 Senior Convertible Debt for $414.3 million in cash and 5.2 million shares

of the Company's common stock valued at $547.6 million for total consideration of $961.8 million, of which $351.7 million was allocated to the fair value of the liability component and $592.3 million was allocated to the reacquisition of the equity component, and (ii) $381.8 million aggregate principal amount of its 2017 Senior Convertible Debt for $381.8 million in cash and 2.1 million shares of the Company's common stock valued at $221.1 million for total consideration of $602.9 million, of which $299.0 million was allocated to the fair value of the liability component and $292.2 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $45.1 million. The Company used borrowings under its Revolving Credit Facility to finance the cash portion of its 2015 Senior Convertible Debt and 2017 Senior Convertible Debt settlement transactions.

In June 2020, the Company used a portion of the proceeds from the issuance of the 2.670% 2023 Notes and the 4.250% 2025 Notes (as further defined below) to (i) repay $615.0 million in borrowings under the Bridge Loan Facility resulting in a loss on settlement of debt of $5.3 million consisting of unamortized financing fees, (ii) settle $383.3 million aggregate principal amount of the Company's 2015 Senior Convertible Debt and $643.9 million aggregate principal amount of the Company's 2017 Senior Convertible Debt, and (iii) repay a portion of the amount outstanding under the Company's existing Revolving Credit Facility as well as for general corporate purposes (the "June 2020 Settlements"). The Company settled, in separate privately negotiated transactions that are accounted for as induced conversions, (i) $383.3 million aggregate principal amount of its 2015 Senior Convertible Debt for $383.3 million in cash and 4.1 million shares of the Company's common stock valued at $405.1 million for total consideration of $788.4 million, of which $314.4 million was allocated to the fair value of the liability component and $464.4 million was allocated to the reacquisition of the equity component, and (ii) $643.9 million aggregate principal amount of its 2017 Senior Convertible Debt for $643.9 million in cash and 2.5 million shares of the Company's common stock valued at $246.4 million for total consideration of $890.3 million, of which $481.0 million was allocated to the fair value of the liability component and $390.9 million was allocated to the reacquisition of the equity component. The consideration was allocated to the liability and equity components using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt instrument prior to the settlement, resulting in a net loss on inducement and settlement of debt of $21.5 million.

In March 2020, the Company settled, in privately negotiated transactions that are accounted for as induced conversions, $615.0 million aggregate principal amount of its 2015 Senior Convertible Debt for $615.0 million in cash and 5.2 million shares of the Company's common stock valued at $351.8 million for total consideration of $966.8 million. In addition, the Company also entered into a Bridge Loan Facility, which provides for a term loan facility for an aggregate principal amount of $615.0 million to finance the cash portion of its 2015 Senior Convertible Debt settlement transaction.

Senior Notes

0.972% 2024 Notes

In December 2020, the Company issued $1.40 billion aggregate principal amount of 0.972% 2024 Notes in a private placement. In connection with the issuance of the notes, the Company incurred issuance costs of $2.2 million and recorded a debt discount of $4.2 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The Company used proceeds from the issuance of 0.972% 2024 Notes to pay the amounts outstanding under its Term Loan Facility. The 0.972% 2024 Notes mature on February 15, 2024 and interest accrues at a rate of 0.972% per annum, payable semi-annually in arrears on February 15 and August 15 of each year.

The Company may, at its option, redeem some or all of the 0.972% 2024 Notes prior to February 15, 2024 at a price equal to the greater of (a) 100% of the principal amount of the 0.972% 2024 Notes redeemed and (b) the sum of the present value of all remaining scheduled payments of principal and interest (discounted in accordance with the 0.972% 2024 Notes indenture) that would have been due on the redeemed 0.972% 2024 Notes, in each case, plus accrued and unpaid interest to, but excluding, the repurchase date. If the Company experiences a specified change of control triggering event, the Company must offer to repurchase the 0.972% 2024 Notes at a price equal to 101% of the principal amount of the 0.972% 2024 Notes repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The 0.972% 2024 Notes indenture contains customary affirmative and negative covenants, including covenants that limit or restrict the Company and its subsidiaries' ability to, among other things, create or incur certain liens, and enter into sale and leaseback transactions, sell or otherwise dispose of any assets constituting collateral securing the 0.972% 2024 Notes, and consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its assets, to another person. These covenants are subject to a number of limitations and exceptions set forth in the indenture.

The 0.972% 2024 Notes are guaranteed by certain of the Company's subsidiaries that have also guaranteed the obligations under the Credit Agreement and under the Company’s existing Senior Indebtedness. In the future, each subsidiary of the Company that is a guarantor or other obligor of the Credit Agreement will guarantee the 0.972% 2024 Notes. The 0.972% 2024 Notes and the 0.972% 2024 Note guarantees are secured, on a pari passu first lien basis with the Credit Agreement and the Company's existing Senior Secured Notes, by substantially all of the tangible and intangible assets (other than certain excluded assets) of the Company and the guarantors that secure obligations under the Credit Agreement and the Company's existing Senior Secured Notes, in each case subject to certain thresholds, exceptions and permitted liens, as set forth in a security agreement, dated December 17, 2020, by and among the Company, the subsidiary guarantors party thereto and the collateral agent.

2.670% 2023 Notes and 4.250% 2025 Notes

In May 2020, the Company issued $1.00 billion aggregate principal amount of 2.670% 2023 Notes and $1.20 billion aggregate principal amount of 4.250% 2025 Notes in a private placement. In connection with the issuance of these notes, the Company incurred issuance costs of $3.8 million and recorded a debt discount of $18.0 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The Company used proceeds from the issuance of the 2.670% 2023 Notes and the 4.250% 2025 Notes to fund the June 2020 Settlements. The 2.670% 2023 Notes mature on September 1, 2023 and interest accrues at a rate of 2.670% per annum, payable semi-annually in arrears on March 1 and September 1 of each year. The 4.250% 2025 Notes mature on September 1, 2025 and interest accrues at a rate of 4.250% per annum, payable semi-annually in arrears on March 1 and September 1 of each year.

The Company may, at its option, redeem some or all of the 2.670% 2023 Notes prior to September 1, 2023 at a price equal to the greater of (a) 100% of the principal amount of the 2.670% 2023 Notes redeemed and (b) the sum of the present value of all remaining scheduled payments of principal and interest (discounted in accordance with the 2.670% 2023 Notes indenture) that would have been due on the redeemed 2.670% 2023 Notes, in each case, plus accrued and unpaid interest to, but excluding, the redemption date. Prior to September 1, 2022, the Company may, at its option, redeem up to 40% of the original aggregate principal amount of the 4.250% 2025 Notes with the net cash proceeds of one or more equity offerings (as such terms are defined in the 4.250% 2025 Notes indenture), at a price equal to 104.250% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date, provided that (i) at least 60% of the original aggregate principal amount of the 4.250% 2025 Notes remains outstanding after each such redemption and (ii) such redemption occurs within 60 days after the closing of such equity offering. In addition, prior to September 1, 2022, the Company may, at its option, redeem the 4.250% 2025 Notes in whole or in part, at a redemption price equal to 100% of the aggregate principal amount of 4.250% 2025 Notes redeemed, plus, in each case, a premium equal to the greater of (i) 1.0% of the principal amount of such 4.250% 2025 Notes and (ii) the excess, if any, of (a) the present value as of such date of redemption of (1) the redemption price of such 4.250% 2025 Notes on September 1, 2022, plus (2) all required interest payments due on such 4.250% 2025 Notes through September 1, 2022 (excluding accrued but unpaid interest to the date of redemption) computed using a discount rate equal to the treasury rate (as defined in the 4.250% 2025 Notes indenture) as of such date of redemption plus 50 basis points, over (b) the then outstanding principal amount of such 4.250% 2025 Notes. On or after September 1, 2022, the Company may, at its option, redeem some or all of the 4.250% 2025 Notes, at a redemption price equal to (i) if during the twelve-month period beginning on September 1, 2022, 102.125% of the aggregate principal amount of 4.250% 2025 Notes redeemed, (ii) if during the twelve-month period beginning on September 1, 2023, 101.063% of the aggregate principal amount of 4.250% 2025 Notes redeemed, and (iii) if during the twelve-month period beginning on September 1, 2024 or thereafter, 100% of the aggregate principal amount of 4.250% 2025 Notes redeemed, in each case, plus accrued and unpaid interest on such 4.250% 2025 Notes, if any, to, but excluding, the repurchase date.

If the Company experiences a specified change of control triggering event, the Company must offer to repurchase the 2.670% 2023 Notes and 4.250% 2025 Notes at a price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The 2.670% 2023 Notes indenture and the 4.250% 2025 Notes indenture contain customary affirmative and negative covenants, including covenants that limit or restrict the Company and its subsidiaries' ability to, among other things, create or incur certain liens, and enter into sale and leaseback transactions, and consolidate with or merge with or into, or convey, transfer or lease all or substantially all of its assets, to another person. The 2.670% 2023 Notes indenture contains covenants that restrict the ability of the Company and its subsidiaries to sell or otherwise dispose of any assets constituting collateral securing the 2.670% 2023 Notes. These covenants are subject to a number of limitations and exceptions set forth in the indentures.

The 2.670% 2023 Notes and 4.250% 2025 Notes are guaranteed by certain of the Company's subsidiaries that have also guaranteed the obligations under the Company's Senior Credit Facilities, and under the Company's existing Senior Secured

Notes. In the future, each subsidiary of the Company that is a guarantor or other obligor of the Company's existing Senior Credit Facilities or certain other indebtedness of the Company will guarantee the 2.670% 2023 Notes and 4.250% 2025 Notes.

The 2.670% 2023 Notes and the 2.670% 2023 Notes guarantees are secured, on a pari passu first lien basis with the Company's existing Senior Credit Facilities, by substantially all of the tangible and intangible assets (other than certain excluded assets) of the Company and the guarantors that secure obligations under the Company's existing Senior Credit Facilities, in each case subject to certain thresholds, exceptions and permitted liens, as set forth in a pledge and the security agreement, dated May 29, 2020, by and among the Company, the subsidiary guarantors party thereto and the collateral agent.

4.333% 2023 Notes and 3.922% 2021 Notes

In May 2018, the Company issued $1.00 billion aggregate principal amount of 3.922% 2021 Notes and $1.00 billion aggregate principal amount of 4.333% 2023 Notes (together, the "Senior Secured Notes") in a private placement. In connection with the issuance of these notes, the Company incurred issuance costs of $24.4 million and recorded a debt discount of $10.5 million for fees deducted from the proceeds, which will both be amortized using the effective interest method over the term of the debt. The 3.922% 2021 Notes mature on June 1, 2021 and the 4.333% 2023 Notes mature on June 1, 2023. Interest on the 3.922% 2021 Notes accrues at a rate of 3.922% per annum, payable semi-annually in arrears on June 1 and December 1 of each year. Interest on the 4.333% 2023 Notes accrues at a rate of 4.333% per annum, payable semi-annually in arrears on June 1 and December 1 of each year.

Senior Credit Facilities

In March 2020 and September 2019, the Company amended the Company's Credit Agreement to, among other things, amend certain negative covenants, including covenants that restrict the Company and its subsidiaries’ ability to, among other things, incur subsidiary indebtedness, grant liens and enter into certain restrictive agreements. The amendments provide the Company the ability to finance a Convertible Notes repurchase not to exceed $1.00 billion with secured debt, and the ability to factor receivables and certain related assets as further explained below. In addition, the amendments reduce the margin added to the interest rate on revolving loans under the Credit Agreement to 0.0% to 0.75% for base rate loans and 1.0% to 1.75% for the LIBOR rate loans, in each case determined based on the Company's senior leverage ratio. The amendments reduced the commitments for the Revolving Credit Facility thereunder to $3.57 billion from $3.60 billion.

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Fair Value of Financial Instruments

9 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.  As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.  As a basis for considering such assumptions, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1-Observable inputs such as quoted prices in active markets;

Level 2-Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3-Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The carrying amount of cash equivalents approximates fair value because their maturity is less than three months. Management believes the carrying amount of the equity and cost-method investments materially approximated fair value at December 31, 2020 based upon unobservable inputs. The fair values of these investments have been determined as Level 3 fair value measurements. The carrying amount of accounts receivable, accounts payable and accrued liabilities approximates fair value due to the short-term maturity of the amounts and are considered Level 2 in the fair value hierarchy.  

The fair values of the Company's Revolving Credit Facility, Term Loan Facility and Bridge Loan Facility are estimated using discounted cash flow analyses, based on the Company's current incremental borrowing rates for similar types of borrowing arrangements. Based on the borrowing rates currently available to the Company for bank loans with similar terms and average maturities, the fair value of the Company's Revolving Credit Facility at December 31, 2020 approximated the carrying value excluding debt discounts and debt issuance costs and are considered Level 2 in the fair value hierarchy. The Company measures the fair value of its Convertible Debt and Senior Notes for disclosure purposes. These fair values are based on observable market prices for this debt, which is traded in less active markets and are therefore classified as a Level 2 fair value measurement.

The following table shows the carrying amounts and fair values of the Company's debt obligations as of December 31, 2020 and March 31, 2020 (in millions):

	December 31, 2020				March 31, 2020
	Carrying Amount (1)		Fair Value		Carrying Amount (1)		Fair Value
Revolving Credit Facility	$	2,345.5	$	2,356.6	$	2,373.9	$	2,388.5
Term Loan Facility	—		—		1,708.9		1,723.5
Bridge Loan Facility	—		—		608.8		615.0
3.922% 2021 Notes	997.5		1,014.0		993.1		985.0
4.333% 2023 Notes	991.4		1,083.0		988.8		990.0
2.670% 2023 Notes	996.1		1,047.2		—		—
0.972% 2024 Notes	1,393.7		1,403.6		—		—
4.250% 2025 Notes	1,184.7		1,257.0		—		—
2015 Senior Convertible Debt	187.9		665.8		910.1		1,601.8
2017 Senior Convertible Debt	352.0		914.3		1,552.8		2,130.3
2020 Senior Convertible Debt	548.6		736.7		—		—
2017 Junior Convertible Debt	143.6		561.9		345.8		656.2
Total	$	9,141.0	$	11,040.1	$	9,482.2	$	11,090.3

(1) The carrying amounts presented are net of debt discounts and debt issuance costs (see Note 6 for further information).

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Intangible Assets and Goodwill

9 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets and Goodwill

Intangible Assets and Goodwill

Intangible assets consist of the following (in millions):

	December 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,362.4	$	(2,558.5)	$	4,803.9
Customer-related	835.2		(679.7)		155.5
In-process research and development	7.7		—		7.7
Distribution rights and other	126.1		(67.4)		58.7
Total	$	8,331.4	$	(3,305.6)	$	5,025.8

	March 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,331.9	$	(1,924.6)	$	5,407.3
Customer-related	903.6		(674.7)		228.9
In-process research and development	8.8		—		8.8
Distribution rights and other	126.0		(68.7)		57.3
Total	$	8,370.3	$	(2,668.0)	$	5,702.3

The following is an expected amortization schedule for the intangible assets for the remainder of fiscal 2021 through fiscal 2025, absent any future acquisitions or impairment charges (in millions):

Fiscal Year Ending March 31,	Projected Amortization Expense
2021	$	247.9
2022	$	911.8
2023	$	707.0
2024	$	626.2
2025	$	508.9

The Company amortizes intangible assets over their expected useful lives, which range between 1 and 15 years. Amortization expense attributed to intangible assets are assigned to cost of sales and operating expenses as follows (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Amortization expense charged to cost of sales	$	2.4	$	2.5	$	6.9	$	7.1
Amortization expense charged to operating expense	244.2		256.1		738.2		770.5
Total amortization expense	$	246.6	$	258.6	$	745.1	$	777.6

There were no impairment charges in the three and nine months ended December 31, 2020 and in the three months ended December 31, 2019. The Company recognized impairment charges of $0.5 million in the nine months ended December 31, 2019.

Goodwill activity for the nine months ended December 31, 2020 by segment was as follows (in millions):

	Semiconductor Products Reporting Unit		Technology Licensing Reporting Unit
Balance at March 31, 2020	$	6,645.6	$	19.2
Additions	5.8		—
Balance at December 31, 2020	$	6,651.4	$	19.2

At March 31, 2020, the Company applied a qualitative goodwill impairment test to its two reporting units, concluding it was not more likely than not that goodwill was impaired. Through December 31, 2020, the Company has never recorded an impairment charge against its goodwill balance.

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Other Financial Statement Details

9 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Other Financial Statement Details

Other Financial Statement Details

Accounts Receivable

Accounts receivable consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Trade accounts receivable	$	887.9	$	924.1
Other	11.1		14.8
Total accounts receivable, gross	899.0		938.9
Less allowance for expected credit losses	5.2		4.9
Total accounts receivable, net	$	893.8	$	934.0

Inventories

The components of inventories consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Raw materials	$	112.8	$	92.3
Work in process	413.6		441.7
Finished goods	139.7		151.7
Total inventories	$	666.1	$	685.7

Inventories are valued at the lower of cost and net realizable value using the first-in, first-out method. Inventory impairment charges establish a new cost basis for inventory and charges are not subsequently reversed to income even if circumstances later suggest that increased carrying amounts are recoverable.

Property, Plant and Equipment

Property, plant and equipment consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Land	$	79.9	$	83.4
Building and building improvements	643.7		659.5
Machinery and equipment	2,190.6		2,123.1
Projects in process	124.2		100.1
Total property, plant and equipment, gross	3,038.4		2,966.1
Less accumulated depreciation and amortization	2,211.0		2,090.0
Total property, plant and equipment, net	$	827.4	$	876.1

Depreciation expense attributed to property, plant and equipment was $40.3 million and $120.4 million for the three and nine months ended December 31, 2020, respectively, compared to $41.4 million and $127.1 million for the three and nine months ended December 31, 2019, respectively.

Accrued Liabilities

Accrued liabilities consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Accrued compensation and benefits	$	166.6	$	137.5
Income taxes payable	12.8		38.0
Sales related reserves	332.2		353.0
Current portion of lease liabilities	40.2		44.5
Accrued expenses and other liabilities	217.4		208.8
Total accrued liabilities	$	769.2	$	781.8

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Commitments and Contingencies

9 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Indemnification Contingencies

The Company's technology license agreements generally include an indemnification clause that indemnifies the licensee against liability and damages (including legal defense costs) arising from any claims of patent, copyright, trademark or trade secret infringement by the Company's proprietary technology.  The terms of these indemnification provisions approximate the terms of the outgoing technology license agreements, which are typically perpetual unless terminated by either party for breach. The possible amount of future payments the Company could be required to make based on agreements that specify indemnification limits, if such indemnifications were required on all of these agreements, is approximately $168.1 million. There are some licensing agreements in place that do not specify indemnification limits. As of December 31, 2020, the Company had not recorded any liabilities related to these indemnification obligations and the Company believes that any amounts that it may be required to pay under these agreements in the future will not have a material adverse effect on its financial position, cash flows or results of operations.

Warranty Costs and Product Liabilities

The Company accrues for known product-related claims if a loss is probable and can be reasonably estimated. During the periods presented, there have been no material accruals or payments regarding product warranty or product liability. Historically, the Company has experienced a low rate of payments on product claims. Although the Company cannot predict the likelihood or amount of any future claims, the Company does not believe these claims will have a material adverse effect on its financial condition, results of operations or liquidity.

Legal Matters

In the ordinary course of the Company's business, it is exposed to various liabilities as a result of contracts, product liability, customer claims, governmental investigations and other matters. Additionally, the Company is involved in a limited number of legal actions, both as plaintiff and defendant. Consequently, the Company could incur uninsured liability in any of those actions.  The Company also periodically receives notifications from various third parties alleging infringement of patents or other intellectual property rights, or from customers requesting reimbursement for various costs. With respect to pending legal actions to which the Company is a party and other claims, although the outcomes are generally not determinable, the Company believes that the ultimate resolution of these matters will not have a material adverse effect on its financial position, cash flows or results of operations. Litigation, governmental investigations and disputes relating to the semiconductor industry are not uncommon, and the Company is, from time to time, subject to such litigation, governmental investigations and disputes.  As a result, no assurances can be given with respect to the extent or outcome of any such litigation, governmental investigations or disputes in the future.

In connection with its acquisition of Microsemi, which closed on May 29, 2018, the Company became involved with the following legal matters:

Federal Shareholder Class Action Litigation.  Beginning on September 14, 2018, the Company and certain of its officers were named in two putative shareholder class action lawsuits filed in the United States District Court for the District of Arizona, captioned Jackson v. Microchip Technology Inc., et al., Case No. 2:18-cv-02914-JJT and Maknissian v. Microchip Technology Inc., et al., Case No. 2:18-cv-02924-JJT. On November 13, 2018, the Maknissian complaint was voluntarily dismissed.  The Jackson complaint is allegedly brought on behalf of a putative class of purchasers of Microchip common stock between March 2, 2018 and August 9, 2018.  The complaint asserts claims for alleged violations of the federal securities laws and generally alleges that the defendants issued materially false and misleading statements and failed to disclose material adverse facts about the Company’s business, operations, and prospects during the putative class period.  The complaint seeks, among other things, compensatory damages and attorneys’ fees and costs on behalf of the putative class.  On December 11, 2018, the Court issued an order appointing the lead plaintiff.  An amended complaint was filed on February 22, 2019. Defendants filed a motion to dismiss the amended complaint on April 1, 2019, which motion was granted in part and denied in part on March 11, 2020. The class certification was filed by the plaintiff on September 11, 2020, and defendants filed their response and statement of non-opposition on October 16, 2020. Discovery is ongoing.

Federal Derivative Litigation.  On December 17, 2018, a shareholder derivative lawsuit was filed against certain of the Company’s officers and directors in the United States District Court for the District of Arizona, captioned Kistenmacher v. Sanghi, et al., Case No. 18-cv-04720.  The Company was named as a nominal defendant.  The complaint generally alleged that defendants breached their fiduciary duties by, among other things, making or causing the Company to make false and misleading statements and omissions regarding the Microsemi acquisition, the Company’s business, operations, and prospects, and a purported failure to maintain internal controls.  The complaint further alleged that certain defendants engaged in insider trading.  The complaint asserted causes of action for alleged violations of Section 14(a) of the Securities Exchange Act, breach of fiduciary duties, and unjust enrichment and sought unspecified monetary damages, corporate governance reforms, restitution, and attorneys’ fees and costs. Defendants filed motions to dismiss on July 23, 2019. On September 13, 2019, the court granted the parties' stipulation of voluntary dismissal dismissing the case without prejudice.

State Derivative Litigation.  On January 22, 2019, a shareholder derivative lawsuit was filed against certain of the Company’s officers and directors in the Superior Court of Arizona for Maricopa County, captioned Reid v. Sanghi, et al., Case No. CV2019-002389.  The Company is named as a nominal defendant.  The complaint generally alleges that defendants breached their fiduciary duties by, among other things, purportedly failing to conduct adequate due diligence regarding Microsemi prior to its acquisition, misrepresenting the Company’s business prospects and health, and engaging in improper practices, and further alleges that certain defendants engaged in insider trading. The complaint asserts causes of action for breach of fiduciary duty, waste, and unjust enrichment and seeks unspecified monetary damages, corporate governance reforms, equitable and/or injunctive relief, restitution, and attorneys’ fees and costs. This case was stayed on May 23, 2019 to allow the Federal Derivative Litigation to address certain overlapping issues. Following the dismissal of the Federal Derivative Litigation, on October 1, 2019, the court granted the parties' joint request for a temporary stay. On January 30, 2020, the court

lifted the temporary stay. An amended complaint was filed on February 28, 2020. Defendants filed their motions to dismiss the amended complaint on April 24, 2020. The parties stipulated to plaintiff's request to file a second amended complaint, and the pending motions to dismiss were withdrawn as moot. A second amended complaint was filed on July 27, 2020. On September 17, 2020, the Company filed a motion to stay proceedings, and the Company and the individual defendants filed motions to dismiss. On November 2, 2020, the court entered the order to stay this matter until January 20, 2021. On January 29, 2021, the Court entered an order continuing the stay until March 26, 2021.

Peterson, et al. v. Sanghi, et al.  On October 9, 2018, four former officers of Microsemi Corporation filed a lawsuit in the Superior Court of California in Orange County against the Company, Steve Sanghi, Eric Bjornholt, Ganesh Moorthy and Mitch Little asserting claims for slander per se, libel per se, trade libel, and violations of California Business and Professions Code Section 17200 ("UCL"). Among other things, the plaintiffs in this matter allege that statements the Microchip executives made about excess shipments of products by Microsemi into the distribution channel were defamatory and that Microchip executives, including Mr. Sanghi, made false statements about Microsemi's shipments of products into the distribution channel, about certain Microsemi business practices and about the relative strength of the financial results of Microchip and Microsemi for the June 2018 quarter. On November 8, 2018, defendants removed the action to the United States District Court for the Central District of California, Case No. 18-cv-02000-JLS. Defendants moved to dismiss, and, following the Court's ruling, Plaintiffs filed an amended complaint that dropped the trade libel and UCL claims. The plaintiffs were seeking compensatory damages in excess of $100 million, punitive damages in excess of $300 million, as well as injunctive relief, and attorneys' fees and costs. In March 2020, the parties settled this matter, and the matter was later dismissed with prejudice.

Governmental Investigations. The Department of Justice and the Securities and Exchange Commission are investigating matters relating to the Company's acquisition of Microsemi. The Company believes that the investigations relate to distribution channel issues and business practices at Microsemi and the allegations made by the plaintiffs in the Peterson v. Sanghi lawsuit described above.

As a result of its acquisition of Atmel, which closed April 4, 2016, the Company became involved with the following legal matters:

Continental Claim ICC Arbitration. On December 29, 2016, Continental Automotive GmbH ("Continental") filed a Request for Arbitration with the ICC, naming as respondents the Company's subsidiaries Atmel Corporation, Atmel SARL, Atmel Global Sales Ltd., and Atmel Automotive GmbH (collectively, "Atmel").  The Request alleges that a quality issue affecting Continental airbag control units in certain recalled vehicles stems from allegedly defective Atmel application specific integrated circuits ("ASICs").  Continental seeks to recover from Atmel all current and future costs and damages incurred as a result of the vehicle manufacturers’ airbag control unit-related recalls, with current costs and damages alleged to be about $115 million to date. The Company's Atmel subsidiaries intend to defend this action vigorously.

Southern District of New York Action by LFoundry Rousset ("LFR") and LFR Employees. On March 4, 2014, LFR and Jean-Yves Guerrini, individually and on behalf of a putative class of LFR employees, filed an action in the United States District Court for the Southern District of New York (the "District Court") against the Company's Atmel subsidiary, French subsidiary, Atmel Rousset S.A.S. ("Atmel Rousset"), and LFoundry GmbH ("LF"), LFR's German parent. The case purports to relate to Atmel Rousset's June 2010 sale of its wafer manufacturing facility in Rousset, France to LF, and LFR's subsequent insolvency, and later liquidation, more than three years later. The District Court dismissed the case on August 21, 2015, and the United States Court of Appeals for the Second Circuit affirmed the dismissal on June 27, 2016. On July 25, 2016, the plaintiffs filed a notice of appeal from the District Court's June 27, 2016 denial of their motion for relief from the dismissal judgment. On May 19, 2017, the United States Court of Appeals for the Second Circuit affirmed the June 27, 2016 order dismissing the case.

Individual Labor Actions by former LFR Employees. In June 2010, Atmel Rousset sold its wafer manufacturing business in Rousset, France to LFoundry GmbH ("LF"), the German parent of LFoundry Rousset ("LFR"). LFR then leased the Atmel Rousset facility to conduct the manufacture of wafers. More than three years later, LFR became insolvent and later liquidated. In the wake of LFR's insolvency and liquidation, over 500 former employees of LFR filed individual labor actions against Atmel Rousset in a French labor court, and in 2019 a French labor court dismissed all of the employees’ claims against Atmel Rousset. Plaintiffs have filed appeals requesting reconsideration of the earlier dismissals. Furthermore, these same claims have been filed by this same group of employees in a regional court in France against Microchip Technology Incorporated and Atmel Corporation. The Company, and the other defendant entities, believe that each of these actions is entirely devoid of merit, and, further, that any assertion by any of the Claimants of a co-employment relationship with any of these entities is based substantially on the same specious arguments that the Paris Commercial Court summarily rejected in 2014 in related proceedings. The defendant entities therefore intend to defend vigorously against each of these claims. Additionally, complaints have been filed in a regional court in France on behalf of the same group of employees against Microchip

Technology Rousset, Atmel Switzerland Sarl, Atmel Corporation and Microchip Technology Incorporated alleging that the sale of the Atmel Rousset production unit to LF was fraudulent and should be voided. These claims are specious and the defendant entities therefore intend to defend vigorously against these claims.The Company accrues for claims and contingencies when losses become probable and reasonably estimable. As of the end of each applicable reporting period, the Company reviews each of its matters and, where it is probable that a liability has been or will be incurred, the Company accrues for all probable and reasonably estimable losses. Where the Company can reasonably estimate a range of losses it may incur regarding such a matter, the Company records an accrual for the amount within the range that constitutes its best estimate. If the Company can reasonably estimate a range but no amount within the range appears to be a better estimate than any other, the Company uses the amount that is the low end of such range. As of December 31, 2020, the Company's estimate of the aggregate potential liability that is possible but not probable is approximately $100 million in excess of amounts accrued.

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Income Taxes

9 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company accounts for incomes taxes in accordance with ASC 740. The provision or benefit for income taxes is attributable to U.S. federal, state, and foreign income taxes. The Company’s effective tax rate used for interim periods is based on an estimated annual effective tax rate including the tax effect of items required to be recorded discretely in the interim periods in which those items occur. A comparison of the Company’s effective tax rates for the nine months ended December 31, 2020 and December 31, 2019 were not meaningful due to the amount of pre-tax income, and income tax benefits recorded during the period.

The Company's effective tax rate is different than the statutory rates in the U.S. due to foreign income taxed at different rates than the U.S., changes in uncertain tax benefit positions, changes to valuation allowances, generation of tax credits, and the impact of GILTI in the United States. In addition, the Company has numerous tax holidays it receives related to its Thailand manufacturing operations based on its investment in property, plant and equipment in Thailand. The Company's tax holiday periods in Thailand expire at various times in the future, however, the Company actively seeks to obtain new tax holidays. The material components of foreign income taxed at a rate lower than the U.S. are earnings accrued in Thailand, Malta, and Ireland.

On July 27, 2015, in Altera Corp. v. Commissioner, the U.S. Tax Court issued an opinion related to the treatment of stock-based compensation expense in an intercompany cost-sharing arrangement. In the July 2015 ruling, the Tax Court concluded that the sharing of the cost of employee stock compensation in a company’s cost-sharing arrangement was invalid under the U.S. Administrative Procedures Act. In June 2019, a panel of the Ninth Circuit of the U.S. Court of Appeals reversed this decision. In July 2019, Altera petitioned U.S. Court of Appeals for the Ninth Circuit to hold an en banc rehearing of the case. In November 2019, the en banc rehearing petition was denied, and Altera asked the U.S. Supreme Court for a judicial review. On June 22, 2020, the U.S. Supreme Court declined to issue a writ of certiorari in Altera v Commissioner, leaving intact the decision reached by the Ninth Circuit of the U.S. Court of Appeals. Based on the Ninth Circuit Opinion, the Company recorded a cumulative income tax expense of $25.2 million in the nine months ended December 31, 2020.

In April 2020, the Company became aware of a withholding tax regulation that could be interpreted to apply to certain of the Company’s previous intra-group transactions.  During the nine months ended December 31, 2020, the Company evaluated the interpretations of these rules as it applies to the Company’s facts and circumstances for tax years remaining open under the applicable statutes of limitation and in response the Company recorded an immaterial income tax expense during the period. The Company will evaluate new information as it becomes available and assess its effect to the tax provision.

The Company files U.S. federal, U.S. state, and foreign income tax returns.  For U.S. federal, and in general for U.S. state tax returns, the fiscal 2007 and later tax years remain open for examination by tax authorities.  For foreign tax returns, the Company is generally no longer subject to income tax examinations for years prior to fiscal 2007.

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Share-Based Compensation

9 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Share-Based Compensation

Share-Based Compensation

The following table presents the details of the Company's share-based compensation expense (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Cost of sales (1)	$	6.4	$	5.7	$	18.8	$	15.8
Research and development	25.0		21.2		70.0		63.0
Selling, general and administrative	19.8		16.6		54.5		50.7
Pre-tax effect of share-based compensation	51.2		43.5		143.3		129.5
Income tax benefit	10.7		9.2		30.5		28.2
Net income effect of share-based compensation	$	40.5	$	34.3	$	112.8	$	101.3

(1) During the three and nine months ended December 31, 2020, $4.5 million and $11.9 million, respectively, of share-based compensation expense was capitalized to inventory, and $6.4 million and $18.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold. During the three and nine months ended December 31, 2019, $5.1 million and $15.4 million, respectively, of share-based compensation expense was capitalized to inventory, and $5.7 million and $15.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold.

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Stock Repurchase Activity	9 Months Ended
	Dec. 31, 2020
Equity [Abstract]
Stock Repurchase Activity	Stock Repurchase Activity As of December 31, 2020, 15.0 million shares of common stock remained available for repurchase under the existing share repurchase program. There is no expiration date associated with the repurchase program. There were no repurchases of common stock during the three and nine months ended December 31, 2020. Shares repurchased are recorded as treasury shares and used to fund share issuance requirements under the Company's equity incentive plans. As of December 31, 2020, the Company had approximately 11.5 million treasury shares.

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Accumulated Other Comprehensive Loss

9 Months Ended

Dec. 31, 2020

Equity [Abstract]

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

The following table presents the changes in the components of accumulated other comprehensive loss, net of tax, (AOCI) for the nine months ended December 31, 2020 (in millions):

	Minimum Pension Liability		Foreign Currency		Total
Balance at March 31, 2020	$	(5.1)	$	(16.5)	$	(21.6)
Other comprehensive (loss) income before reclassifications	(6.9)		5.3		(1.6)
Reclassification of realized transactions	0.9		—		0.9
Net other comprehensive (loss) income	(6.0)		5.3		(0.7)
Balance at December 31, 2020	$	(11.1)	$	(11.2)	$	(22.3)

The table below details where reclassifications of realized transactions out of accumulated other comprehensive loss are recorded on the consolidated statements of income (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,				Related Statement of Income Line
Description of AOCI Component	2020		2019		2020		2019
Amortization of actuarial loss	$	(0.3)	$	(0.2)	$	(0.9)	$	(0.6)	Other loss, net

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Dividends	9 Months Ended
	Dec. 31, 2020
Dividends [Abstract]
Dividends	Dividends A quarterly cash dividend of $0.3685 per share was paid on December 4, 2020 in the aggregate amount of $96.0 million.  A quarterly cash dividend of $0.39 per share was declared on February 4, 2021 and will be paid on March 8, 2021 to stockholders of record as of February 22, 2021. The Company expects the March 2021 payment of its quarterly cash dividend to be approximately $105.0 million.

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Recently Issued Accounting Policies (Policies)

9 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Recently Issued Accounting Pronouncements Not Yet Adopted

Recently Issued Accounting Pronouncements Not Yet Adopted

In August 2020, the FASB issued ASU 2020-06-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity, which simplifies the guidance for certain convertible debt instruments by removing the separation models for convertible debt with a cash conversion feature or convertible instruments with a beneficial conversion feature. As a result, convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. Additionally, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company expects the primary impacts of this new standard will be to increase the carrying value of its Convertible Debt and reduce its reported interest expense. In addition, the Company will be required to use the if-converted method for calculating diluted earnings per share. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04-Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions to U.S. GAAP for applying guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The guidance is effective upon issuance and may be adopted on any date on or after March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12-Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This guidance enhances and simplifies various aspects of the income tax accounting standard ASC 740, including requirements related to hybrid tax regimes, the tax basis step-up in goodwill obtained in a transaction that is not a business combination, separate financial statements of entities not subject to tax, the intraperiod tax allocation exception to the incremental approach, ownership changes in investments, interim-period accounting for enacted changes in tax law, and the year-to-date loss limitation in interim-period tax accounting. The amendments are effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements.

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Recently Issued Accounting Pronouncements (Tables)

9 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Schedule of Recently Adopted Accounting Pronouncements

On April 1, 2020, the Company adopted the following Accounting Standards Updates, none of which had a material impact on its consolidated financial statements.

Accounting Standards Updates	Description
ASU 2018-15	Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract
ASU 2018-13	Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement
ASU 2017-04	Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment
ASU 2016-13	Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

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Segment Information (Tables)

9 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Schedule of Net Sales and Gross Profit for Each Segment

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2020 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2020				December 31, 2020
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,319.9	$	813.6	$	3,893.9	$	2,374.6
Technology licensing	32.2		32.2		77.4		77.4
Total	$	1,352.1	$	845.8	$	3,971.3	$	2,452.0

The following table represents net sales and gross profit for each segment for the three and nine months ended December 31, 2019 (in millions):

	Three Months Ended				Nine Months Ended
	December 31, 2019				December 31, 2019
	Net Sales		Gross Profit		Net Sales		Gross Profit
Semiconductor products	$	1,257.0	$	755.1	$	3,875.6	$	2,356.0
Technology licensing	30.4		30.4		72.2		72.2
Total	$	1,287.4	$	785.5	$	3,947.8	$	2,428.2

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Net Sales (Tables)

9 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The following table represents the Company's net sales by product line (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Microcontrollers	$	726.3	$	685.8	$	2,145.8	$	2,091.8
Analog	372.8		363.3		1,104.7		1,143.6
FPGA	99.1		92.6		294.3		276.8
LMO	153.9		145.7		426.5		435.6
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

The following table represents the Company's net sales by contract type (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Distributors	$	681.6	$	638.8	$	2,003.7	$	1,970.0
Direct customers	638.3		618.2		1,890.2		1,905.6
Licensees	32.2		30.4		77.4		72.2
Total net sales	$	1,352.1	$	1,287.4	$	3,971.3	$	3,947.8

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Net Income Per Common Share (Tables)

9 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Net income	$	36.2	$	311.1	$	233.4	$	470.7
Basic weighted average common shares outstanding	263.4		239.2		255.7		238.5
Dilutive effect of stock options and RSUs	3.7		3.4		3.4		3.5
Dilutive effect of 2015 Senior Convertible Debt	3.5		15.2		5.4		13.6
Dilutive effect of 2017 Senior Convertible Debt	2.8		0.3		1.5		0.1
Dilutive effect of 2020 Senior Convertible Debt	—		—		—		—
Dilutive effect of 2017 Junior Convertible Debt	2.0		0.2		1.0		0.1
Diluted weighted average common shares outstanding	275.4		258.3		267.0		255.8
Basic net income per common share	$	0.14	$	1.30	$	0.91	$	1.97
Diluted net income per common share	$	0.13	$	1.20	$	0.87	$	1.84

Schedule of Convertible Debt

The following is the weighted average conversion price per share used in calculating the dilutive effect (see Note 6 for details on the Convertible Debt):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
2015 Senior Convertible Debt	$	60.78	$	61.67	$	60.99	$	61.92
2017 Senior Convertible Debt	$	94.78	$	96.16	$	95.11	$	96.56
2020 Senior Convertible Debt	$	186.87	$	—	$	186.87	$	—
2017 Junior Convertible Debt	$	93.12	$	94.48	$	93.44	$	94.87

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Debt (Tables)

9 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Schedule of Debt Instruments

Debt obligations included in the condensed consolidated balance sheets consisted of the following (in millions):

	Coupon Interest Rate	Effective Interest Rate	Fair Value of Liability Component at Issuance (1)
				December 31,		March 31,
				2020		2020
Senior Secured Indebtedness
Revolving Credit Facility				$	2,356.6	$	2,388.5
Term Loan Facility				—		1,723.5
Bridge Loan Facility				—		615.0
3.922% 2021 Notes	3.922%	4.5%		1,000.0		1,000.0
4.333% 2023 Notes	4.333%	4.7%		1,000.0		1,000.0
2.670% 2023 Notes	2.670%	2.8%		1,000.0		—
0.972% 2024 Notes	0.972%	1.1%		1,400.0		—
Senior Unsecured Indebtedness
4.250% 2025 Notes	4.250%	4.6%		1,200.0		—
Total Senior Indebtedness				7,956.6		6,727.0
Senior Subordinated Convertible Debt - Principal Outstanding
2015 Senior Convertible Debt	1.625%	5.9%	$188.5	222.4		1,110.0
2017 Senior Convertible Debt	1.625%	6.0%	$353.6	455.5		2,070.0
2020 Senior Convertible Debt	0.125%	5.1%	$555.5	665.5		—
Junior Subordinated Convertible Debt - Principal Outstanding
2017 Junior Convertible Debt	2.250%	7.4%	$144.5	278.6		686.3
Total Convertible Debt				1,622.0		3,866.3
Gross long-term debt including current maturities				9,578.6		10,593.3
Less: Debt discount (2)				(399.6)		(1,043.2)
Less: Debt issuance costs (3)				(38.0)		(67.9)
Net long-term debt including current maturities				9,141.0		9,482.2
Less: Current maturities (4)				(1,493.2)		(608.8)
Net long-term debt				$	7,647.8	$	8,873.4

(1) As each of the convertible debt instruments may be settled in cash upon conversion, for accounting purposes, they were bifurcated into a liability component and an equity component, which are both initially recorded at fair value.  The amount allocated to the equity component is the difference between the principal value of the instrument and the fair value of the liability component at issuance.  The resulting debt discount is being amortized to interest expense at the respective effective interest rate over the contractual term of the debt.

(2) The unamortized discount consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Bridge Loan Facility	$	—	$	(3.1)
3.922% 2021 Notes	(0.8)		(2.1)
4.333% 2023 Notes	(2.7)		(3.5)
2.670% 2023 Notes	(2.5)		—
0.972% 2024 Notes	(4.1)		—
4.250% 2025 Notes	(13.5)		—
2015 Senior Convertible Debt	(33.3)		(192.9)
2017 Senior Convertible Debt	(100.9)		(504.2)
2020 Senior Convertible Debt	(108.0)		—
2017 Junior Convertible Debt	(133.8)		(337.4)
Total unamortized discount	$	(399.6)	$	(1,043.2)

(3) Debt issuance costs consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Revolving Credit Facility	$	(11.1)	$	(14.6)
Term Loan Facility	—		(14.6)
Bridge Loan Facility	—		(3.1)
3.922% 2021 Notes	(1.7)		(4.8)
4.333% 2023 Notes	(5.9)		(7.7)
2.670% 2023 Notes	(1.4)		—
0.972% 2024 Notes	(2.2)		—
4.250% 2025 Notes	(1.8)		—
2015 Senior Convertible Debt	(1.2)		(7.0)
2017 Senior Convertible Debt	(2.6)		(13.0)
2020 Senior Convertible Debt	(8.9)		—
2017 Junior Convertible Debt	(1.2)		(3.1)
Total debt issuance costs	$	(38.0)	$	(67.9)

(4) As of December 31, 2020, current maturities consist of the liability component of the 2017 Senior Convertible Debt and the 2017 Junior Convertible Debt, and the 3.922% 2021 Notes which are due June 1, 2021. As of March 31, 2020, current maturities included the Bridge Loan Facility.

Schedule of Maturities of Long-term Debt

Expected maturities relating to the Company’s debt obligations as of December 31, 2020 are as follows (in millions):

Fiscal year ending March 31,	Expected Maturities
2021	$	—
2022	1,000.0
2023	—
2024	5,756.6
2025	887.9
Thereafter	1,934.1
Total	$	9,578.6

Convertible Debt

The following table sets forth the applicable conversion rates adjusted for dividends declared since issuance of such series of Convertible Debt and the applicable incremental share factors and maximum conversion rates as adjusted for dividends paid since the applicable issuance date:

	Dividend adjusted rates as of December 31, 2020
	Conversion Rate	Approximate Conversion Price		Incremental Share Factor	Maximum Conversion Rate
2015 Senior Convertible Debt (1)	16.4786	$	60.68	8.2393	23.0700
2017 Senior Convertible Debt (1)	10.5670	$	94.63	5.2835	15.0581
2020 Senior Convertible Debt (1)	5.3514	$	186.87	—	7.4919
2017 Junior Convertible Debt (1)	10.7558	$	92.97	5.3779	15.0581

(1) As of December 31, 2020, the 2020 Senior Convertible Debt was not convertible. As of December 31, 2020, the holders of the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt have the right to convert their notes between January 1, 2021 and March 31, 2021 because the Company's common stock price has exceeded the applicable conversion price for such series by 130% for the specified period of time during the quarter ended December 31, 2020. As of December 31, 2020, the adjusted conversion rate for the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt would be increased to 21.0976 shares of common stock, 12.2303 shares of common stock, and 12.5134 shares of common stock, respectively, per $1,000 principal amount of notes based on the closing common stock price of $138.11 to include an additional maximum incremental share rate per the terms of the applicable indenture. As of December 31, 2020, the 2015 Senior Convertible Debt, 2017 Senior Convertible Debt, and 2017 Junior Convertible Debt had a conversion value in excess of par of $425.6 million, $313.9 million, and $202.9 million, respectively.

Schedule of Interest Expense

Interest expense consists of the following (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Debt issuance amortization	$	3.7	$	3.3	$	11.5	$	9.9
Debt discount amortization	1.6		0.7		4.7		2.1
Interest expense	59.2		64.1		171.3		217.7
Total interest expense on Senior Indebtedness	64.5		68.1		187.5		229.7
Debt issuance amortization	0.5		1.0		1.7		2.9
Debt discount amortization	12.8		30.0		52.8		88.8
Coupon interest expense	7.8		19.3		33.9		57.9
Total interest expense on Convertible Debt	21.1		50.3		88.4		149.6
Other interest expense	0.9		1.3		3.0		2.6
Total interest expense	$	86.5	$	119.7	$	278.9	$	381.9

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Fair Value of Financial Instruments (Tables)

9 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Summary of Carrying Amount and Fair Values

The following table shows the carrying amounts and fair values of the Company's debt obligations as of December 31, 2020 and March 31, 2020 (in millions):

	December 31, 2020				March 31, 2020
	Carrying Amount (1)		Fair Value		Carrying Amount (1)		Fair Value
Revolving Credit Facility	$	2,345.5	$	2,356.6	$	2,373.9	$	2,388.5
Term Loan Facility	—		—		1,708.9		1,723.5
Bridge Loan Facility	—		—		608.8		615.0
3.922% 2021 Notes	997.5		1,014.0		993.1		985.0
4.333% 2023 Notes	991.4		1,083.0		988.8		990.0
2.670% 2023 Notes	996.1		1,047.2		—		—
0.972% 2024 Notes	1,393.7		1,403.6		—		—
4.250% 2025 Notes	1,184.7		1,257.0		—		—
2015 Senior Convertible Debt	187.9		665.8		910.1		1,601.8
2017 Senior Convertible Debt	352.0		914.3		1,552.8		2,130.3
2020 Senior Convertible Debt	548.6		736.7		—		—
2017 Junior Convertible Debt	143.6		561.9		345.8		656.2
Total	$	9,141.0	$	11,040.1	$	9,482.2	$	11,090.3

(1) The carrying amounts presented are net of debt discounts and debt issuance costs (see Note 6 for further information).

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Intangible Assets and Goodwill (Tables)

9 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets, Indefinite-Lived

Intangible assets consist of the following (in millions):

	December 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,362.4	$	(2,558.5)	$	4,803.9
Customer-related	835.2		(679.7)		155.5
In-process research and development	7.7		—		7.7
Distribution rights and other	126.1		(67.4)		58.7
Total	$	8,331.4	$	(3,305.6)	$	5,025.8

	March 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,331.9	$	(1,924.6)	$	5,407.3
Customer-related	903.6		(674.7)		228.9
In-process research and development	8.8		—		8.8
Distribution rights and other	126.0		(68.7)		57.3
Total	$	8,370.3	$	(2,668.0)	$	5,702.3

Schedule of Intangible Assets, Finite-Lived

Intangible assets consist of the following (in millions):

	December 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,362.4	$	(2,558.5)	$	4,803.9
Customer-related	835.2		(679.7)		155.5
In-process research and development	7.7		—		7.7
Distribution rights and other	126.1		(67.4)		58.7
Total	$	8,331.4	$	(3,305.6)	$	5,025.8

	March 31, 2020
	Gross Amount		Accumulated Amortization		Net Amount
Core and developed technology	$	7,331.9	$	(1,924.6)	$	5,407.3
Customer-related	903.6		(674.7)		228.9
In-process research and development	8.8		—		8.8
Distribution rights and other	126.0		(68.7)		57.3
Total	$	8,370.3	$	(2,668.0)	$	5,702.3

Schedule of Projected Amortization Expense

The following is an expected amortization schedule for the intangible assets for the remainder of fiscal 2021 through fiscal 2025, absent any future acquisitions or impairment charges (in millions):

Fiscal Year Ending March 31,	Projected Amortization Expense
2021	$	247.9
2022	$	911.8
2023	$	707.0
2024	$	626.2
2025	$	508.9

Schedule of Amortization Expense by Intangible Asset Class

Amortization expense attributed to intangible assets are assigned to cost of sales and operating expenses as follows (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Amortization expense charged to cost of sales	$	2.4	$	2.5	$	6.9	$	7.1
Amortization expense charged to operating expense	244.2		256.1		738.2		770.5
Total amortization expense	$	246.6	$	258.6	$	745.1	$	777.6

Schedule of Goodwill Activity

Goodwill activity for the nine months ended December 31, 2020 by segment was as follows (in millions):

	Semiconductor Products Reporting Unit		Technology Licensing Reporting Unit
Balance at March 31, 2020	$	6,645.6	$	19.2
Additions	5.8		—
Balance at December 31, 2020	$	6,651.4	$	19.2

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Other Financial Statement Details (Tables)

9 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Accounts Receivable

Accounts receivable consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Trade accounts receivable	$	887.9	$	924.1
Other	11.1		14.8
Total accounts receivable, gross	899.0		938.9
Less allowance for expected credit losses	5.2		4.9
Total accounts receivable, net	$	893.8	$	934.0

Summary of Inventory

The components of inventories consist of the following (in millions):

	December 31,		March 31,
	2020		2020
Raw materials	$	112.8	$	92.3
Work in process	413.6		441.7
Finished goods	139.7		151.7
Total inventories	$	666.1	$	685.7

Summary of Property, Plant and Equipment

Property, plant and equipment consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Land	$	79.9	$	83.4
Building and building improvements	643.7		659.5
Machinery and equipment	2,190.6		2,123.1
Projects in process	124.2		100.1
Total property, plant and equipment, gross	3,038.4		2,966.1
Less accumulated depreciation and amortization	2,211.0		2,090.0
Total property, plant and equipment, net	$	827.4	$	876.1

Summary of Accrued Liabilities

Accrued liabilities consists of the following (in millions):

	December 31,		March 31,
	2020		2020
Accrued compensation and benefits	$	166.6	$	137.5
Income taxes payable	12.8		38.0
Sales related reserves	332.2		353.0
Current portion of lease liabilities	40.2		44.5
Accrued expenses and other liabilities	217.4		208.8
Total accrued liabilities	$	769.2	$	781.8

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Share-Based Compensation (Tables)

9 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Schedule of Share-based Compensation Expense

The following table presents the details of the Company's share-based compensation expense (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2020		2019		2020		2019
Cost of sales (1)	$	6.4	$	5.7	$	18.8	$	15.8
Research and development	25.0		21.2		70.0		63.0
Selling, general and administrative	19.8		16.6		54.5		50.7
Pre-tax effect of share-based compensation	51.2		43.5		143.3		129.5
Income tax benefit	10.7		9.2		30.5		28.2
Net income effect of share-based compensation	$	40.5	$	34.3	$	112.8	$	101.3

(1) During the three and nine months ended December 31, 2020, $4.5 million and $11.9 million, respectively, of share-based compensation expense was capitalized to inventory, and $6.4 million and $18.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold. During the three and nine months ended December 31, 2019, $5.1 million and $15.4 million, respectively, of share-based compensation expense was capitalized to inventory, and $5.7 million and $15.8 million, respectively, of previously capitalized share-based compensation expense in inventory was sold.

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Accumulated Other Comprehensive Loss (Tables)

9 Months Ended

Dec. 31, 2020

Equity [Abstract]

Schedule of Changes in Components of Accumulated Other Comprehensive Income

The following table presents the changes in the components of accumulated other comprehensive loss, net of tax, (AOCI) for the nine months ended December 31, 2020 (in millions):

	Minimum Pension Liability		Foreign Currency		Total
Balance at March 31, 2020	$	(5.1)	$	(16.5)	$	(21.6)
Other comprehensive (loss) income before reclassifications	(6.9)		5.3		(1.6)
Reclassification of realized transactions	0.9		—		0.9
Net other comprehensive (loss) income	(6.0)		5.3		(0.7)
Balance at December 31, 2020	$	(11.1)	$	(11.2)	$	(22.3)

Schedule of Reclassification Out of Other Comprehensive Income

The table below details where reclassifications of realized transactions out of accumulated other comprehensive loss are recorded on the consolidated statements of income (in millions):

	Three Months Ended December 31,				Nine Months Ended December 31,				Related Statement of Income Line
Description of AOCI Component	2020		2019		2020		2019
Amortization of actuarial loss	$	(0.3)	$	(0.2)	$	(0.9)	$	(0.6)	Other loss, net

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Segment Information - Net Sales and Gross Profit (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Segment reporting information [Line Items]
Net Sales	$ 1,352.1	$ 1,287.4	$ 3,971.3	$ 3,947.8
Gross Profit	845.8	785.5	2,452.0	2,428.2
Semiconductor products
Segment reporting information [Line Items]
Net Sales	1,319.9	1,257.0	3,893.9	3,875.6
Gross Profit	813.6	755.1	2,374.6	2,356.0
Technology licensing
Segment reporting information [Line Items]
Net Sales	32.2	30.4	77.4	72.2
Gross Profit	$ 32.2	$ 30.4	$ 77.4	$ 72.2

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Net Sales (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Total net sales	$ 1,352.1	$ 1,287.4	$ 3,971.3	$ 3,947.8
Distributors
Disaggregation of Revenue [Line Items]
Total net sales	681.6	638.8	2,003.7	1,970.0
Direct customers
Disaggregation of Revenue [Line Items]
Total net sales	638.3	618.2	1,890.2	1,905.6
Licensees
Disaggregation of Revenue [Line Items]
Total net sales	32.2	30.4	77.4	72.2
Microcontrollers
Disaggregation of Revenue [Line Items]
Total net sales	726.3	685.8	2,145.8	2,091.8
Analog
Disaggregation of Revenue [Line Items]
Total net sales	372.8	363.3	1,104.7	1,143.6
FPGA
Disaggregation of Revenue [Line Items]
Total net sales	99.1	92.6	294.3	276.8
LMO
Disaggregation of Revenue [Line Items]
Total net sales	$ 153.9	$ 145.7	$ 426.5	$ 435.6

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Net Income Per Common Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended						9 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income	$ 36.2	$ 73.6	$ 123.6	$ 311.1	$ 108.9	$ 50.7	$ 233.4	$ 470.7
Basic weighted average common shares outstanding (in shares)	263,400,000			239,200,000			255,700,000	238,500,000
Dilutive effect of stock options and RSUs (in shares)	3,700,000			3,400,000			3,400,000	3,500,000
Diluted weighted average common shares outstanding (in shares)	275,400,000			258,300,000			267,000,000.0	255,800,000
Basic net income per common share (in dollars per share)	$ 0.14			$ 1.30			$ 0.91	$ 1.97
Diluted net income per common share (in dollars per share)	$ 0.13			$ 1.20			$ 0.87	$ 1.84
Antidilutive dilutive option shares (in shares)	0			0			0	0
2015 Senior Convertible Debt
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of Convertible Debt (in shares)	3,500,000			15,200,000			5,400,000	13,600,000
2015 Senior Convertible Debt | Weighted Average
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Debt instrument, convertible, conversion price (in dollars per share)	$ 60.78			$ 61.67			$ 60.99	$ 61.92
2017 Senior Convertible Debt
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of Convertible Debt (in shares)	2,800,000			300,000			1,500,000	100,000
2017 Senior Convertible Debt | Weighted Average
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Debt instrument, convertible, conversion price (in dollars per share)	$ 94.78			$ 96.16			$ 95.11	$ 96.56
2020 Senior Convertible Debt
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of Convertible Debt (in shares)	0			0			0	0
2020 Senior Convertible Debt | Weighted Average
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Debt instrument, convertible, conversion price (in dollars per share)	$ 186.87			$ 0			$ 186.87	$ 0
2017 Junior Convertible Debt
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of Convertible Debt (in shares)	2,000,000.0			200,000			1,000,000.0	100,000
2017 Junior Convertible Debt | Weighted Average
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Debt instrument, convertible, conversion price (in dollars per share)	$ 93.12			$ 94.48			$ 93.44	$ 94.87

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Debt - Debt Obligations (Details) - USD ($) $ in Millions	Dec. 31, 2020	Dec. 01, 2020	May 31, 2020	Mar. 31, 2020	May 31, 2018
Debt Instrument [Line Items]
Gross long-term debt including current maturities	$ 9,578.6			$ 10,593.3
Less: Debt discount	(399.6)			(1,043.2)
Less: Debt issuance costs	(38.0)			(67.9)
Net long-term debt including current maturities	9,141.0			9,482.2
Less: Current maturities	(1,493.2)			(608.8)
Net long-term debt	7,647.8			8,873.4
Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Gross long-term debt including current maturities	2,356.6			2,388.5
Less: Debt issuance costs	(11.1)			(14.6)
Line of Credit | Term Loan Facility
Debt Instrument [Line Items]
Gross long-term debt including current maturities	0.0			1,723.5
Less: Debt issuance costs	0.0			(14.6)
Bridge Loan Facility
Debt Instrument [Line Items]
Gross long-term debt including current maturities	0.0			615.0
Less: Debt discount	0.0			(3.1)
Less: Debt issuance costs	0.0			(3.1)
Senior Indebtedness
Debt Instrument [Line Items]
Gross long-term debt including current maturities	$ 7,956.6			6,727.0
Less: Debt discount					$ (10.5)
Less: Debt issuance costs					$ (24.4)
Senior Indebtedness | 3.922% 2021 Notes
Debt Instrument [Line Items]
Coupon Interest Rate	3.922%				3.922%
Effective Interest Rate	4.50%
Gross long-term debt including current maturities	$ 1,000.0			1,000.0
Less: Debt discount	(0.8)			(2.1)
Less: Debt issuance costs	$ (1.7)			(4.8)
Senior Indebtedness | 4.333% 2023 Notes
Debt Instrument [Line Items]
Coupon Interest Rate	4.333%				4.333%
Effective Interest Rate	4.70%
Gross long-term debt including current maturities	$ 1,000.0			1,000.0
Less: Debt discount	(2.7)			(3.5)
Less: Debt issuance costs	$ (5.9)			(7.7)
Senior Indebtedness | 2.670% 2023 Notes
Debt Instrument [Line Items]
Coupon Interest Rate	2.67%		2.67%
Effective Interest Rate	2.80%
Gross long-term debt including current maturities	$ 1,000.0			0.0
Less: Debt discount	(2.5)			0.0
Less: Debt issuance costs	$ (1.4)			0.0
Senior Indebtedness | 0.972% 2024 Notes
Debt Instrument [Line Items]
Coupon Interest Rate	0.972%
Effective Interest Rate	1.10%
Gross long-term debt including current maturities	$ 1,400.0			0.0
Less: Debt discount	(4.1)	$ (4.2)		0.0
Less: Debt issuance costs	$ (2.2)			0.0
Senior Indebtedness | 4.250% 2025 Notes
Debt Instrument [Line Items]
Coupon Interest Rate	4.25%		4.25%
Effective Interest Rate	4.60%
Gross long-term debt including current maturities	$ 1,200.0			0.0
Less: Debt discount	(13.5)			0.0
Less: Debt issuance costs	(1.8)			0.0
Senior Indebtedness | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Less: Debt discount	(110.0)
Convertible Debt
Debt Instrument [Line Items]
Gross long-term debt including current maturities	$ 1,622.0			3,866.3
Senior Subordinated Convertible Debt | 2015 Senior Convertible Debt
Debt Instrument [Line Items]
Coupon Interest Rate	1.625%
Effective Interest Rate	5.90%
Fair Value of Liability Component at Issuance	$ 188.5
Gross long-term debt including current maturities	222.4			1,110.0
Less: Debt discount	(33.3)			(192.9)
Less: Debt issuance costs	$ (1.2)			(7.0)
Senior Subordinated Convertible Debt | 2017 Senior Convertible Debt
Debt Instrument [Line Items]
Coupon Interest Rate	1.625%
Effective Interest Rate	6.00%
Fair Value of Liability Component at Issuance	$ 353.6
Gross long-term debt including current maturities	455.5			2,070.0
Less: Debt discount	(100.9)			(504.2)
Less: Debt issuance costs	$ (2.6)			(13.0)
Senior Subordinated Convertible Debt | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Coupon Interest Rate	0.125%
Effective Interest Rate	5.10%
Fair Value of Liability Component at Issuance	$ 555.5
Gross long-term debt including current maturities	665.5			0.0
Less: Debt discount	(108.0)			0.0
Less: Debt issuance costs	$ (8.9)			0.0
Junior Subordinated Convertible Debt | 2017 Junior Convertible Debt
Debt Instrument [Line Items]
Coupon Interest Rate	2.25%
Effective Interest Rate	7.40%
Fair Value of Liability Component at Issuance	$ 144.5
Gross long-term debt including current maturities	278.6			686.3
Less: Debt discount	(133.8)			(337.4)
Less: Debt issuance costs	$ (1.2)			$ (3.1)

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Debt - Unamortized Discount and Debt Issuance Costs (Details) - USD ($) $ in Millions	Dec. 31, 2020	Dec. 01, 2020	Mar. 31, 2020	May 31, 2018
Debt Instrument [Line Items]
Total unamortized discount	$ (399.6)		$ (1,043.2)
Total debt issuance costs	(38.0)		(67.9)
Bridge Loan Facility
Debt Instrument [Line Items]
Total unamortized discount	0.0		(3.1)
Total debt issuance costs	0.0		(3.1)
Senior Indebtedness
Debt Instrument [Line Items]
Total unamortized discount				$ (10.5)
Total debt issuance costs				$ (24.4)
Senior Indebtedness | 3.922% 2021 Notes
Debt Instrument [Line Items]
Total unamortized discount	(0.8)		(2.1)
Total debt issuance costs	(1.7)		(4.8)
Senior Indebtedness | 4.333% 2023 Notes
Debt Instrument [Line Items]
Total unamortized discount	(2.7)		(3.5)
Total debt issuance costs	(5.9)		(7.7)
Senior Indebtedness | 2.670% 2023 Notes
Debt Instrument [Line Items]
Total unamortized discount	(2.5)		0.0
Total debt issuance costs	(1.4)		0.0
Senior Indebtedness | 0.972% 2024 Notes
Debt Instrument [Line Items]
Total unamortized discount	(4.1)	$ (4.2)	0.0
Total debt issuance costs	(2.2)		0.0
Senior Indebtedness | 4.250% 2025 Notes
Debt Instrument [Line Items]
Total unamortized discount	(13.5)		0.0
Total debt issuance costs	(1.8)		0.0
Senior Indebtedness | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Total unamortized discount	(110.0)
Senior Convertible Debt | 2015 Senior Convertible Debt
Debt Instrument [Line Items]
Total unamortized discount	(33.3)		(192.9)
Total debt issuance costs	(1.2)		(7.0)
Senior Convertible Debt | 2017 Senior Convertible Debt
Debt Instrument [Line Items]
Total unamortized discount	(100.9)		(504.2)
Total debt issuance costs	(2.6)		(13.0)
Senior Convertible Debt | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Total unamortized discount	(108.0)		0.0
Total debt issuance costs	(8.9)		0.0
Junior Convertible Debt | 2017 Junior Convertible Debt
Debt Instrument [Line Items]
Total unamortized discount	(133.8)		(337.4)
Total debt issuance costs	$ (1.2)		$ (3.1)

XML

Debt - Maturities (Details) - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
Fiscal year ending March 31,
2021	$ 0.0
Long-Term Debt, Maturity, Year One	1,000.0
2022	0.0
2024	887.9
2025	1,934.1
Gross long-term debt including current maturities	9,578.6	$ 10,593.3
Long-Term Debt, Maturity, Year Three	$ 5,756.6

XML

Debt - Summary of Conversion Features (Details) $ / shares in Units, shares in Millions	1 Months Ended				3 Months Ended				9 Months Ended
	Dec. 31, 2020 USD ($) $ / shares shares	Aug. 31, 2020 USD ($) shares	Jun. 30, 2020 USD ($) shares	Mar. 31, 2020 USD ($) shares	Dec. 31, 2020 USD ($)	Sep. 30, 2020 USD ($)	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($) day	Dec. 31, 2019 USD ($)	Dec. 01, 2020 USD ($)	May 31, 2020 USD ($)	May 31, 2018 USD ($)
Debt Instrument [Line Items]
If-converted value in excess of principal									$ 1,000
Payments on settlement of convertible debt									2,252,200,000	$ 0
Shares issued to settle convertible debt					$ 1,160,100,000	$ 768,700,000	$ 651,500,000
Gain (loss) on settlement of debt	$ (129,200,000)	$ (45,100,000)	$ (21,500,000)		(142,100,000)			$ 0	(214,000,000.0)	(2,000,000.0)
Debt instrument, unamortized discount	399,600,000			$ 1,043,200,000	399,600,000				399,600,000
Gross long-term debt including current maturities	$ 9,578,600,000			10,593,300,000	9,578,600,000				9,578,600,000
Maximum
Debt Instrument [Line Items]
Option indexed to equity, strike price (in dollars per share) | $ / shares	$ 233.58
Revolving Credit Facility
Debt Instrument [Line Items]
Proceeds from borrowings on revolving loan under credit facility	$ 213,000,000.0								$ 3,073,000,000.0	$ 682,000,000.0
Term Loan Facility
Debt Instrument [Line Items]
Gain (loss) on settlement of debt	(12,900,000)
Long-term Debt
Debt Instrument [Line Items]
Extinguishment of debt, amount	1,086,500,000
Payments on settlement of convertible debt	$ 428,900,000
Shares issued to settle convertible debt (in shares) | shares	8.4
2017 Senior Convertible Debt
Debt Instrument [Line Items]
Remaining period, in years, over which unamortized debt discount will be recognized as non-cash interest expense (in years)									6 years 1 month 6 days
Payments on settlement of convertible debt	$ 155,400,000	381,800,000	643,900,000
2017 Senior Convertible Debt | Long-term Debt
Debt Instrument [Line Items]
Extinguishment of debt, amount	$ 588,800,000	$ 381,800,000	$ 643,900,000
Shares issued to settle convertible debt (in shares) | shares	3.0	2.1	2.5
Shares issued to settle convertible debt	$ 408,700,000	$ 221,100,000	$ 246,400,000
Total consideration, extinguishment of debt	1,200,000,000	602,900,000	890,300,000
Total consideration, extinguishment of debt, liability component	486,700,000	299,000,000.0	481,000,000.0
Total consideration, extinguishment of debt, equity component	655,300,000	292,200,000	390,900,000
2015 Senior Convertible Debt
Debt Instrument [Line Items]
Threshold percentage of stock price trigger									130.00%
Remaining period, in years, over which unamortized debt discount will be recognized as non-cash interest expense (in years)									4 years 1 month 6 days
Payments on settlement of convertible debt	48,500,000	414,300,000	383,300,000	615,000,000.0
2015 Senior Convertible Debt | Long-term Debt
Debt Instrument [Line Items]
Extinguishment of debt, amount	$ 90,000,000.0	$ 414,300,000	$ 383,300,000	$ 615,000,000.0
Shares issued to settle convertible debt (in shares) | shares	1.6	5.2	4.1	5.2
Shares issued to settle convertible debt	$ 221,000,000.0	$ 547,600,000	$ 405,100,000	$ 351,800,000
Total consideration, extinguishment of debt	269,600,000	961,800,000	788,400,000	966,800,000
Total consideration, extinguishment of debt, liability component	79,400,000	351,700,000	314,400,000
Total consideration, extinguishment of debt, equity component	184,500,000	$ 592,300,000	464,400,000
2017 Junior Convertible Debt
Debt Instrument [Line Items]
Remaining period, in years, over which unamortized debt discount will be recognized as non-cash interest expense (in years)									16 years 1 month 6 days
Payments on settlement of convertible debt	225,000,000.0
2017 Junior Convertible Debt | Long-term Debt
Debt Instrument [Line Items]
Extinguishment of debt, amount	$ 407,700,000
Shares issued to settle convertible debt (in shares) | shares	3.8
Shares issued to settle convertible debt	$ 530,400,000
Total consideration, extinguishment of debt	819,400,000
Total consideration, extinguishment of debt, liability component	246,300,000
Total consideration, extinguishment of debt, equity component	547,100,000
2020 Senior Convertible Debt
Debt Instrument [Line Items]
Remaining period, in years, over which unamortized debt discount will be recognized as non-cash interest expense (in years)									3 years 10 months 24 days
2020 Senior Convertible Debt | Long-term Debt
Debt Instrument [Line Items]
Debt conversion, converted instrument amount	665,500,000
2020 Senior Convertible Debt | Long-term Debt | 2017 Senior Convertible Debt
Debt Instrument [Line Items]
Debt conversion, converted instrument amount	601,500,000
2020 Senior Convertible Debt | Long-term Debt | 2017 Junior Convertible Debt
Debt Instrument [Line Items]
Debt conversion, converted instrument amount	64,000,000.0
Convertible Debt
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)									100.00%
Gross long-term debt including current maturities	1,622,000,000.0			3,866,300,000	1,622,000,000.0				$ 1,622,000,000.0
Convertible Debt | Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Threshold percentage of stock price trigger									130.00%
Threshold trading days | day									20
Threshold consecutive trading days | day									30
Convertible Debt | Debt Instrument, Redemption, Period Two
Debt Instrument [Line Items]
Threshold percentage of stock price trigger									98.00%
Threshold trading days | day									5
Threshold consecutive trading days | day									10
Senior Indebtedness
Debt Instrument [Line Items]
Debt instrument, unamortized discount													$ 10,500,000
Gross long-term debt including current maturities	7,956,600,000			6,727,000,000.0	7,956,600,000				$ 7,956,600,000
Senior Indebtedness | 2017 Senior Convertible Debt
Debt Instrument [Line Items]
Debt instrument, face amount						$ 643,900,000
Senior Indebtedness | 2015 Senior Convertible Debt
Debt Instrument [Line Items]
Extinguishment of debt, amount			383,300,000
Senior Indebtedness | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Debt issuance costs, including equity portion, gross	10,800,000
Debt issuance costs, gross	9,000,000.0				9,000,000.0				9,000,000.0
Equity portion of convertible debt issuance costs	1,800,000
Debt instrument, unamortized discount	110,000,000.0				110,000,000.0				110,000,000.0
Capped options indexed to equity, costs	35,800,000
Senior Indebtedness | 2.670% 2023 Notes
Debt Instrument [Line Items]
Debt instrument, unamortized discount	$ 2,500,000			0	$ 2,500,000				$ 2,500,000
Debt instrument, face amount												$ 1,000,000,000.00
Coupon Interest Rate	2.67%				2.67%				2.67%			2.67%
Gross long-term debt including current maturities	$ 1,000,000,000.0			0	$ 1,000,000,000.0				$ 1,000,000,000.0
Senior Indebtedness | 0.972% 2024 Notes
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)									101.00%
Debt instrument, unamortized discount	4,100,000			0	4,100,000				$ 4,100,000		$ 4,200,000
Debt instrument, face amount	$ 1,400,000,000				$ 1,400,000,000				$ 1,400,000,000
Coupon Interest Rate	0.972%				0.972%				0.972%
Gross long-term debt including current maturities	$ 1,400,000,000.0			0	$ 1,400,000,000.0				$ 1,400,000,000.0
Senior Indebtedness | Debt Instrument, Redemption, Period One | 0.972% 2024 Notes
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)	100.00%
Bridge Loan Facility
Debt Instrument [Line Items]
Extinguishment of debt, amount			615,000,000.0
Gain (loss) on settlement of debt			$ (5,300,000)
Debt instrument, unamortized discount	$ 0			3,100,000	0				0
Gross long-term debt including current maturities	$ 0			$ 615,000,000.0	$ 0				$ 0

XML

Debt - Convertible Debt (Details)	9 Months Ended
	Dec. 31, 2020 USD ($) $ / shares
Debt Instrument [Line Items]
Value if converted above par | $	$ 1,000
2015 Senior Convertible Debt
Debt Instrument [Line Items]
Threshold percentage of stock price trigger	130.00%
Senior Convertible Debt | 2017 Senior Convertible Debt
Debt Instrument [Line Items]
Conversion Rate	10.5670
Approximate Conversion Price (in dollars per share)	$ 94.63
Incremental Share Factor	5.2835
Maximum Conversion Rate	15.0581
Conversion rate, adjusted based on closing stock price	12.2303
Value if converted above par | $	$ 313,900,000
Senior Convertible Debt | 2015 Senior Convertible Debt
Debt Instrument [Line Items]
Conversion Rate	16.4786
Approximate Conversion Price (in dollars per share)	$ 60.68
Incremental Share Factor	8.2393
Maximum Conversion Rate	23.0700
Conversion rate, adjusted based on closing stock price	21.0976
Value if converted above par | $	$ 425,600,000
Senior Convertible Debt | 2017 Junior Convertible Debt
Debt Instrument [Line Items]
Conversion rate, adjusted based on closing stock price	12.5134
Senior Convertible Debt | 2020 Senior Convertible Debt
Debt Instrument [Line Items]
Conversion Rate	5.3514
Approximate Conversion Price (in dollars per share)	$ 186.87
Incremental Share Factor	0
Maximum Conversion Rate	7.4919
Junior Convertible Debt | 2017 Junior Convertible Debt
Debt Instrument [Line Items]
Conversion Rate	10.7558
Approximate Conversion Price (in dollars per share)	$ 92.97
Incremental Share Factor	5.3779
Maximum Conversion Rate	15.0581
Value if converted above par | $	$ 202,900,000
Common Stock
Debt Instrument [Line Items]
Share price (in dollars per share)	$ 138.11

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Debt - Interest Expense (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Debt issuance amortization			$ 13.2	$ 12.8
Debt discount amortization			57.5	90.9
Other interest expense	$ 0.9	$ 1.3	3.0	2.6
Total interest expense	86.5	119.7	278.9	381.9
Senior Secured Indebtedness
Debt Instrument [Line Items]
Debt issuance amortization	3.7	3.3	11.5	9.9
Debt discount amortization	1.6	0.7	4.7	2.1
Interest expense	59.2	64.1	171.3	217.7
Total interest expense	64.5	68.1	187.5	229.7
Convertible Debt
Debt Instrument [Line Items]
Debt issuance amortization	0.5	1.0	1.7	2.9
Debt discount amortization	12.8	30.0	52.8	88.8
Interest expense	7.8	19.3	33.9	57.9
Total interest expense	$ 21.1	$ 50.3	$ 88.4	$ 149.6

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Debt - Senior Notes (Details) - USD ($)	1 Months Ended		9 Months Ended
	Dec. 31, 2020	May 31, 2020	Dec. 31, 2020	Dec. 01, 2020	Mar. 31, 2020	May 31, 2018
Debt Instrument [Line Items]
Debt issuance costs, net	$ 38,000,000.0		$ 38,000,000.0		$ 67,900,000
Debt instrument, unamortized discount	$ 399,600,000		$ 399,600,000		1,043,200,000
Senior Indebtedness
Debt Instrument [Line Items]
Debt issuance costs, net						$ 24,400,000
Debt instrument, unamortized discount						10,500,000
Senior Indebtedness | 2.670% 2023 Notes
Debt Instrument [Line Items]
Debt instrument, face amount		$ 1,000,000,000.00
Debt instrument, interest rate, stated percentage	2.67%	2.67%	2.67%
Debt issuance costs, net	$ 1,400,000		$ 1,400,000		0
Debt instrument, unamortized discount	$ 2,500,000		$ 2,500,000		0
Senior Indebtedness | 2.670% 2023 Notes | Prior to September 1, 2023
Debt Instrument [Line Items]
Debt instrument, interest rate, stated percentage		2.67%
Debt instrument, redemption price (percent)		100.00%
Senior Indebtedness | 4.250% 2025 Notes
Debt Instrument [Line Items]
Debt instrument, face amount		$ 1,200,000,000
Debt instrument, interest rate, stated percentage	4.25%	4.25%	4.25%
Debt issuance costs, net	$ 1,800,000		$ 1,800,000		0
Debt instrument, unamortized discount	$ 13,500,000		$ 13,500,000		0
Senior Indebtedness | 4.250% 2025 Notes | Prior to September 1, 2022
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)		104.25%
Debt instrument, redemption price, percentage of principal amount redeemed (percent)		40.00%
Debt instrument, redemption, original aggregate principal amount required to remain outstanding after redemption (percent)		60.00%
Debt instrument, redemption period following closing of equity offering		60 days
Senior Indebtedness | 4.250% 2025 Notes | Prior to September 1, 2022, including premium
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)		100.00%
Debt instrument, redemption, premium on principal amount (percent)		1.00%
Basis spread on treasury rate		50.00%
Senior Indebtedness | 4.250% 2025 Notes | Twelve-month Period beginning September 1, 2022
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)		102.125%
Senior Indebtedness | 4.250% 2025 Notes | Twelve-month Period beginning September 1, 2023
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)		101.063%
Senior Indebtedness | 4.250% 2025 Notes | Twelve-month Period beginning September 1, 2024
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)		100.00%
Senior Indebtedness | 2.670% 2023 Notes and 4.250% 2025 Notes
Debt Instrument [Line Items]
Debt issuance costs, net		$ 3,800,000
Debt instrument, unamortized discount		$ 18,000,000.0
Debt instrument, redemption price (percent)			101.00%
Senior Indebtedness | 3.922% 2021 Notes
Debt Instrument [Line Items]
Debt instrument, face amount						$ 1,000,000,000.00
Debt instrument, interest rate, stated percentage	3.922%		3.922%			3.922%
Debt issuance costs, net	$ 1,700,000		$ 1,700,000		4,800,000
Debt instrument, unamortized discount	$ 800,000		$ 800,000		2,100,000
Senior Indebtedness | 4.333% 2023 Notes
Debt Instrument [Line Items]
Debt instrument, face amount						$ 1,000,000,000.00
Debt instrument, interest rate, stated percentage	4.333%		4.333%			4.333%
Debt issuance costs, net	$ 5,900,000		$ 5,900,000		7,700,000
Debt instrument, unamortized discount	2,700,000		2,700,000		3,500,000
Senior Indebtedness | 0.972% 2024 Notes
Debt Instrument [Line Items]
Debt instrument, face amount	$ 1,400,000,000		$ 1,400,000,000
Debt instrument, interest rate, stated percentage	0.972%		0.972%
Debt issuance costs, net	$ 2,200,000		$ 2,200,000		0
Debt instrument, unamortized discount	$ 4,100,000		$ 4,100,000	$ 4,200,000	$ 0
Debt instrument, redemption price (percent)			101.00%
Senior Indebtedness | 0.972% 2024 Notes | Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Debt instrument, redemption price (percent)	100.00%

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Debt - Senior Credit Facilities (Details) - Revolving Credit Facility - Line of Credit - USD ($)	1 Months Ended
	Mar. 31, 2020	Dec. 31, 2020	Sep. 30, 2019
Debt Instrument [Line Items]
Maximum amount to finance Convertible Notes		$ 1,000,000,000.00
Maximum borrowing capacity		$ 3,570,000,000	$ 3,600,000,000
Base Rate | Minimum
Debt Instrument [Line Items]
Basis spread on treasury rate	0.00%
Base Rate | Maximum
Debt Instrument [Line Items]
Basis spread on treasury rate	0.75%
LIBOR | Minimum
Debt Instrument [Line Items]
Basis spread on treasury rate	1.00%
LIBOR | Maximum
Debt Instrument [Line Items]
Basis spread on treasury rate	1.75%

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Fair Value of Financial Instruments (Details) - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	$ 9,141.0	$ 9,482.2
Carrying Amount | Revolving Credit Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	2,345.5	2,373.9
Carrying Amount | Term Loan Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	0.0	1,708.9
Carrying Amount | Bridge Loan Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	0.0	608.8
Carrying Amount | 3.922% 2021 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	997.5	993.1
Carrying Amount | 4.333% 2023 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	991.4	988.8
Carrying Amount | 2.670% 2023 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	996.1	0.0
Carrying Amount | 0.972% 2024 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,393.7	0.0
Carrying Amount | 4.250% 2025 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,184.7	0.0
Carrying Amount | 2015 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	187.9	910.1
Carrying Amount | 2017 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	352.0	1,552.8
Carrying Amount | 2020 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	548.6	0.0
Carrying Amount | 2017 Junior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	143.6	345.8
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	11,040.1	11,090.3
Fair Value | Revolving Credit Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	2,356.6	2,388.5
Fair Value | Term Loan Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	0.0	1,723.5
Fair Value | Bridge Loan Facility
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	0.0	615.0
Fair Value | 3.922% 2021 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,014.0	985.0
Fair Value | 4.333% 2023 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,083.0	990.0
Fair Value | 2.670% 2023 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,047.2	0.0
Fair Value | 0.972% 2024 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,403.6	0.0
Fair Value | 4.250% 2025 Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	1,257.0	0.0
Fair Value | 2015 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	665.8	1,601.8
Fair Value | 2017 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	914.3	2,130.3
Fair Value | 2020 Senior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	736.7	0.0
Fair Value | 2017 Junior Convertible Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value disclosure for debt obligations	$ 561.9	$ 656.2

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Intangible Assets and Goodwill - Intangible Assets, by Major Class (Details) - USD ($) $ in Millions	9 Months Ended
	Dec. 31, 2020	Mar. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Accumulated Amortization	$ (3,305.6)	$ (2,668.0)
Gross Amount	8,331.4	8,370.3
Net Amount	5,025.8	5,702.3
Projected Amortization Expense
2021	247.9
2022	911.8
2023	707.0
2024	626.2
2025	$ 508.9
Minimum
Projected Amortization Expense
Useful life	1 year
Maximum
Projected Amortization Expense
Useful life	15 years
In-process research and development
Indefinite-lived Intangible Assets [Line Items]
In-process research and development	$ 7.7	8.8
Core and developed technology
Finite-Lived Intangible Assets [Line Items]
Gross Amount	7,362.4	7,331.9
Accumulated Amortization	(2,558.5)	(1,924.6)
Net Amount	4,803.9	5,407.3
Customer-related
Finite-Lived Intangible Assets [Line Items]
Gross Amount	835.2	903.6
Accumulated Amortization	(679.7)	(674.7)
Net Amount	155.5	228.9
Distribution rights and other
Finite-Lived Intangible Assets [Line Items]
Gross Amount	126.1	126.0
Accumulated Amortization	(67.4)	(68.7)
Net Amount	$ 58.7	$ 57.3

XML

Intangible Assets and Goodwill - Amortization of Intangible Assets (Details) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 246,600,000	$ 258,600,000	$ 745,100,000	$ 777,600,000
Impairment of intangible assets	0	0	0	500,000
Amortization expense charged to cost of sales
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	2,400,000	2,500,000	6,900,000	7,100,000
Amortization expense charged to operating expense
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 244,200,000	$ 256,100,000	$ 738,200,000	$ 770,500,000

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Intangible Assets and Goodwill - Goodwill by Reporting Segment (Details) $ in Millions	3 Months Ended	9 Months Ended
	Jun. 30, 2020 USD ($) unit	Dec. 31, 2020 USD ($)
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 6,664.8	$ 6,664.8
Goodwill, Ending Balance		6,670.6
Number of reporting units | unit	2
Semiconductor Products Reporting Unit
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 6,645.6	6,645.6
Additions		5.8
Goodwill, Ending Balance		6,651.4
Technology Licensing Reporting Unit
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 19.2	19.2
Additions		0.0
Goodwill, Ending Balance		$ 19.2

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Other Financial Statement Details - Accounts Receivable (Details) - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable, gross	$ 899.0	$ 938.9
Less allowance for expected credit losses	5.2	4.9
Total accounts receivable, net	893.8	934.0
Trade accounts receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable, gross	887.9	924.1
Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable, gross	$ 11.1	$ 14.8

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Other Financial Statement Details - Inventories (Details) - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Raw materials	$ 112.8	$ 92.3
Work in process	413.6	441.7
Finished goods	139.7	151.7
Total inventories	$ 666.1	$ 685.7

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Other Financial Statement Details - Property, Plant and Equipment (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Mar. 31, 2020
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 3,038.4		$ 3,038.4		$ 2,966.1
Less accumulated depreciation and amortization	2,211.0		2,211.0		2,090.0
Total property, plant and equipment, net	827.4		827.4		876.1
Depreciation expense	40.3	$ 41.4	120.4	$ 127.1
Land
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	79.9		79.9		83.4
Building and building improvements
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	643.7		643.7		659.5
Machinery and equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	2,190.6		2,190.6		2,123.1
Projects in process
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 124.2		$ 124.2		$ 100.1

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Other Financial Statement Details - Accrued Liabilities (Details) - USD ($) $ in Millions	Dec. 31, 2020	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accrued compensation and benefits	$ 166.6	$ 137.5
Income taxes payable	12.8	38.0
Sales related reserves	332.2	353.0
Current portion of lease liabilities	40.2	44.5
Accrued expenses and other liabilities	217.4	208.8
Total accrued liabilities	$ 769.2	$ 781.8

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Commitments and Contingencies (Details) $ in Millions		1 Months Ended
	Oct. 09, 2018 USD ($) plaintiff	Jun. 30, 2010 plaintiff	Dec. 31, 2020 USD ($)	Sep. 14, 2018 lawsuit
Loss Contingencies [Line Items]
Loss contingency, range of possible loss, portion not accrued			$ 100.0
Federal Shareholder Class Action Litigation
Loss Contingencies [Line Items]
Loss contingency, pending claims, number | lawsuit				2
Peterson, et al. v. Sanghi, et al.
Loss Contingencies [Line Items]
Loss contingency, number of plaintiffs | plaintiff	4
Individual Labor Actions by former LFR Employees.
Loss Contingencies [Line Items]
Loss contingency, number of plaintiffs | plaintiff		500
Indemnification Agreement
Loss Contingencies [Line Items]
Loss contingency, estimate of possible loss			168.1
Compensatory Damages | Peterson, et al. v. Sanghi, et al.
Loss Contingencies [Line Items]
Loss contingency, damages sought, value	$ 100.0
Punitive Damages | Peterson, et al. v. Sanghi, et al.
Loss Contingencies [Line Items]
Loss contingency, damages sought, value	$ 300.0
Damages from Product Defects | Continental Claim ICC Arbitration.
Loss Contingencies [Line Items]
Loss contingency, estimate of possible loss			$ 115.0

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Income Taxes (Details) $ in Millions	9 Months Ended
	Dec. 31, 2020 USD ($)
Income Tax Disclosure [Abstract]
Cumulative income tax expense impact of Altera decision	$ 25.2

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Share-Based Compensation - Share-Based Compensation Expense (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Pre-tax effect of share-based compensation	$ 51.2	$ 43.5	$ 143.3	$ 129.5
Income tax benefit	10.7	9.2	30.5	28.2
Net income effect of share-based compensation	40.5	34.3	112.8	101.3
Inventory
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Capitalized share-based compensation expense	4.5	5.1	11.9	15.4
Share-based compensation expense previously capitalized	6.4	5.7	18.8	15.8
Cost of sales
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Pre-tax effect of share-based compensation	6.4	5.7	18.8	15.8
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Pre-tax effect of share-based compensation	25.0	21.2	70.0	63.0
Selling, general and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Pre-tax effect of share-based compensation	$ 19.8	$ 16.6	$ 54.5	$ 50.7

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Stock Repurchase Activity (Details) - shares	9 Months Ended
	Dec. 31, 2020	Mar. 31, 2020
Equity [Abstract]
Stock repurchase program, number of shares authorized remaining to be repurchased (in shares)	15,000,000.0
Repurchased shares under authorization (in shares)	0
Treasury stock (in shares)	11,467,154	13,065,588

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Accumulated Other Comprehensive Loss - Schedule of Changes in the Components of AOCI (Details) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2020	Dec. 31, 2019
Changes in the components of AOCI
Beginning balance	$ 5,443.7	$ 5,501.3	$ 5,585.5	$ 5,361.3	$ 5,288.3	$ 5,287.5	$ 5,585.5	$ 5,287.5
Other comprehensive (loss) income before reclassifications							(1.6)
Reclassification of realized transactions							0.9
Other comprehensive (loss) income, net of tax effect	(1.4)	0.2	0.5	0.3	0.0	(0.3)	(0.7)	0.0
Ending balance	5,297.0	5,443.7	5,501.3	5,616.6	5,361.3	5,288.3	5,297.0	5,616.6
Total
Changes in the components of AOCI
Beginning balance	(20.9)	(21.1)	(21.6)	(22.3)	(22.3)	(20.7)	(21.6)	(20.7)
Other comprehensive (loss) income, net of tax effect	(1.4)	0.2	0.5	0.3	0.0	(0.3)
Ending balance	(22.3)	$ (20.9)	(21.1)	$ (22.0)	$ (22.3)	$ (22.3)	(22.3)	$ (22.0)
Minimum Pension Liability
Changes in the components of AOCI
Beginning balance			(5.1)				(5.1)
Other comprehensive (loss) income before reclassifications							(6.9)
Reclassification of realized transactions							0.9
Other comprehensive (loss) income, net of tax effect							(6.0)
Ending balance	(11.1)						(11.1)
Foreign Currency
Changes in the components of AOCI
Beginning balance			$ (16.5)				(16.5)
Other comprehensive (loss) income before reclassifications							5.3
Reclassification of realized transactions							0.0
Other comprehensive (loss) income, net of tax effect							5.3
Ending balance	$ (11.2)						$ (11.2)

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Accumulated Other Comprehensive Loss - Schedule of Reclassifications of Recognized Transactions out of AOCI (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other income, net	$ (0.4)	$ (1.5)	$ (2.9)	$ (0.2)
Reclassification out of Accumulated Other Comprehensive Income | Amortization of actuarial loss
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other income, net	$ (0.3)	$ (0.2)	$ (0.9)	$ (0.6)

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Dividends (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended						9 Months Ended
	Feb. 04, 2021	Dec. 04, 2020	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Dec. 31, 2020	Dec. 31, 2019
Dividends Payable [Line Items]
Cash dividend paid (in dollars per share)		$ 0.3685
Dividends declared per common share (in dollars per share)			$ 0.3685			$ 0.3665			$ 1.1040	$ 1.0980
Cash dividend		$ 96.0	$ 96.0	$ 95.3	$ 90.4	$ 87.7	$ 87.3	$ 87.1
Subsequent Event
Dividends Payable [Line Items]
Dividends declared per common share (in dollars per share)	$ 0.39
Forecast
Dividends Payable [Line Items]
Cash dividend	$ 105.0