SAN JOSE, Calif. -- Microchip Technology Inc. beat Wall Street's forecast amid strong demand for its microcontroller lines and other products.

The company also saw its largest sequential growth in 15 years. It said sales for the second quarter of fiscal year 2010 were $226.7 million, up 17.5 percent sequentially from net sales of $192.9 million in the immediately preceding quarter, and down 16 percent from net sales of $269.7 million in the prior year’s second fiscal quarter.

Microchip (Chandler, Ariz.) said GAAP net income for the second quarter of fiscal year 2010 was $44.5 million, or $0.24 per diluted share, up 62.5 percent from GAAP net income of $27.4 million, or $0.15 per diluted share, in the immediately preceding quarter, and down 41.3 percent from GAAP net income of $75.7 million, or $0.40 per diluted share, in the prior year’s second fiscal quarter.

Microchip beat Wall Street's forecast, which was $0.21 a share on sales of $218.3 million.

“During the September quarter we experienced strength in all geographies and product lines, allowing us to exceed our revenue, gross margin and earnings per share guidance that we revised positively in early September,” said Steve Sanghi, Microchip’s president and CEO, in a statement.

Prior to the results, analysts were bullish about the company. ''We believe that Microchip's microcontroller exposure (MCU--81 percent, analog-10 percent, memory-9 percent) is likely to drive the majority of its sequential growth, as trends within MCUs have been particularly strong,'' said analyst Doug Freedman of Broadpoint Amtech, in a report before the results. ''While MCUs accounts for the lion’s share of sales, analog is expected to grow at least through the next two quarters, driven by continued design-ins.''

For Q3, Microchip expects sales to range from $236-to- $245 million. Earnings per share are expected to range from $0.27-to-$0.29.

Capital expenditures for the quarter ending Dec. 31, 2009 are expected to be approximately $20 million. Capital expenditures for all of fiscal year 2010 are anticipated to be approximately $35 million. For 2010, the company expects sales of $1.05 billion and earnings per share $1.29.