The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. We are not able to predict whether inventory at our distributors will increase or decrease and are therefore providing a range of GAAP net sales guidance. In recent years, we have seen net inventory at our distributors increase or decrease by a significant amount in a single quarter.
| Microchip Consolidated Guidance | |||
| GAAP |
Non-GAAP
Adjustments | Non-GAAP1 | |
| Net Sales | $1.323 to $1.375 billion | - | $1.323 to $1.375 billion |
| Gross Margin | 61.4% to 61.7% | $5.5 to $6.5 million | 61.8% to 62.2% |
| Operating Expenses2 | 46.8% to 48.2% | $290.0 to $296.0 million | 25.3% to 26.3% |
| Operating Income | 13.2% to 14.9% | $295.5 to $302.5 million | 35.5% to 36.9% |
| Other Expense, net | $130 to $132 million | $31 million | $99 to $101 million |
| Income Taxes | 20% to 25%3 | $5.7 to $11.2 million | 5% to 6%4 |
| Net Income | $33.0 to $58.4 million | $315.3 to $327.8 million | $348.3 to $386.2 million |
| Diluted Common Shares Outstanding | Approximately 254.7 to 259.4 million shares | - | Approximately 254.7 to 259.4 million shares
|
| Earnings per Diluted Share | 13 to 23 cents | $1.24 to $1.26 | $1.37 to $1.49 |
- For the quarter ending September 30, 2019, our GAAP and non-GAAP net sales guidance are the same and both reflect GAAP sell-in revenue recognition. See the "Use of Non-GAAP Financial Measures" section of this release for information regarding our non-GAAP guidance for items other than Net Sales.
- We are not able to estimate the amount of Special Charges and Other, net that may be incurred during the quarter ending September 30, 2019. Therefore, our estimate of GAAP operating expenses excludes any amount that may be recognized as Special Charges and Other, net in the quarter ending September 30, 2019.
- The forecast for GAAP tax expense excludes any unexpected tax events that may occur during the quarter, as these amounts cannot be forecasted.
- Represents expected cash tax rate for fiscal 2020 excluding any transition tax payments associated with the Tax Cuts and Jobs Act.
- Microchip's inventory days in the September 2019 quarter are expected to be in the range of 127 to 134 days, compared to 132 days at June 30, 2019. Our actual inventory level will depend on the inventory that our distributors decide to hold to support their customers, overall demand for our products and our production levels.
- Capital expenditures for the quarter ending September 30, 2019 are expected to be about $30 million. Capital expenditures for all of fiscal 2020 are expected to be between $110 million and $130 million. We are continuing to invest in the equipment needed to support the growth of our production capabilities for fast-growing new products and technologies and to bring in-house more of the assembly and test operations that are currently outsourced.
