The sensor configuration of the magnetostrictive guided wave system can be described as a single continuous transducing element which makes it difficult to separate the individual modes from the reflected signal. In this work we develop the mode decomposition technique employing chirplet transform, which is able to separate the individual modes from dispersive and multimodal waveform measured with the magnetostrictive sensor, and to estimate the time-frequency centers and individual energies of the reflection, which would be used to locate and characterize defects. The reflection coefficients are calculated using the modal energies of the separated mode. Results from experimental results on a carbon steel pipe are presented, which show that the accurate and quantitative defect characterization could become enabled using the proposed technique.