Onsemi Q2 Earnings Beat Expectations, Stock Soars 11%

On July 29, 2024, Onsemi, a global leader in power semiconductors and image sensors, released its financial results for the second quarter of 2024, ending June 28. The company achieved revenues of $1.735 billion, reflecting a 17% decrease year-over-year and a 7% decline quarter-over-quarter. This figure slightly exceeded analyst expectations of $1.73 billion. Onsemi reported a gross margin of 45.2% and an operating margin of 22.4%. Non-GAAP net income was $412 million, down 29.4% compared to the same period last year and 11.3% from the previous quarter. Earnings per share (EPS) were $0.96, marking a year-over-year drop of 27.8% and a quarter-over-quarter decline of 11.1%, yet surpassing the analyst estimate of $0.92.

The company’s stock saw a significant boost of 11.54% following the announcement, marking the largest increase since November 10, 2022. The share price closed at $78.27, achieving a new high since July 16.

Hassane El-Khoury, Onsemi’s President and CEO, stated, “We are dedicated to driving growth by expanding our market presence, increasing investments in strategic markets, and enhancing our product portfolio with advanced analog and mixed-signal solutions. Our recent agreement with Volkswagen underscores our growing leadership in silicon carbide for the automotive sector, as we work closely with leading OEMs in Europe, North America, and China to scale up production.”

For Q3 2024, Onsemi projects revenue between $1.7 billion and $1.8 billion. The company anticipates a GAAP gross margin between 44.3% and 46.3%, with EPS estimated between $0.85 and $0.97. Under Non-GAAP standards, the gross margin is expected to range from 44.4% to 46.4%, with EPS forecasted between $0.91 and $1.03.

In June 2024, Onsemi also announced plans to consolidate nine of its factories and reduce its global workforce by about 1,000 employees. Approximately 300 employees will be reassigned or relocated to other facilities.