onsemi (NASDAQ:ON) Posts Earnings Results, Beats Estimates By $0.02 EPS

onsemi (NASDAQ:ON) issued its quarterly earnings results on Monday. The semiconductor company reported $0.74 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.72 by $0.02, Zacks reports. onsemi had a return on equity of 12.79% and a net margin of 9.46%.The firm had revenue of $1.60 billion during the quarter, compared to analyst estimates of $1.59 billion. During the same period last year, the company posted $0.53 EPS. The firm’s quarterly revenue was up 9.2% on a year-over-year basis. onsemi updated its Q3 2026 guidance to 0.810-0.930 EPS.

Here are the key takeaways from onsemi’s conference call:

• Q2 results exceeded guidance: Revenue reached $1.6 billion, non-GAAP gross margin was 39.3%, and non-GAAP EPS was $0.74. Free cash flow rose to $425 million, while the company returned $332 million through share repurchases.
• AI data center momentum accelerated: ON Semiconductor now expects AI data center revenue to more than double in 2026, supported by wins with Nvidia’s MGX ecosystem, AWS-related platforms, and China’s Great Wall. The company is expanding content across the power chain as demand shifts toward 800-volt DC architectures.
• Growth opportunities broadened across energy and automotive: Energy storage system revenue is expected to increase approximately 40% in 2026, while China automotive revenue grew 13% in the first half despite lower vehicle sales. China automotive silicon carbide revenue is projected to rise 60% to 70% year over year, driven by market-share gains and new vehicle programs.
• Third-quarter outlook implies continued operating leverage: Revenue is forecast at $1.65 billion to $1.75 billion, with non-GAAP gross margin of 40% to 42% and EPS of $0.81 to $0.93. Management expects utilization-related margin benefits to continue, although the full effect may emerge with a lag.
• Supply constraints and the Synaptics acquisition remain key developments: Lead times have extended, orders within lead time are increasing, and the company is implementing price increases to offset higher input costs. ON Semiconductor expects its acquisition of Synaptics to close in mid-2027, subject to customary approvals.

onsemi Trading Down 1.5%

Shares of NASDAQ ON opened at $80.40 on Tuesday. The company has a current ratio of 4.87, a quick ratio of 3.14 and a debt-to-equity ratio of 0.41. onsemi has a one year low of $44.56 and a one year high of $134.92. The business has a 50-day moving average price of $104.28 and a two-hundred day moving average price of $85.07. The firm has a market capitalization of $31.51 billion, a PE ratio of 57.02, a PEG ratio of 0.90 and a beta of 2.03.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. DV Equities LLC acquired a new position in onsemi in the 4th quarter valued at approximately $30,000. Darwin Wealth Management LLC acquired a new stake in shares of onsemi during the 2nd quarter valued at $32,000. Summit Securities Group LLC grew its holdings in shares of onsemi by 346.3% during the 4th quarter. Summit Securities Group LLC now owns 598 shares of the semiconductor company’s stock valued at $32,000 after acquiring an additional 464 shares in the last quarter. Atlas Capital Advisors Inc. purchased a new position in shares of onsemi during the 4th quarter valued at $46,000. Finally, Geneos Wealth Management Inc. increased its stake in shares of onsemi by 61.2% in the first quarter. Geneos Wealth Management Inc. now owns 1,335 shares of the semiconductor company’s stock worth $54,000 after acquiring an additional 507 shares during the last quarter. 97.70% of the stock is owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

Several equities analysts have recently weighed in on ON shares. Citigroup raised their price objective on shares of onsemi from $100.00 to $120.00 and gave the company a “neutral” rating in a research report on Monday, June 15th. UBS Group reaffirmed a “neutral” rating and issued a $95.00 price target on shares of onsemi in a report on Monday, June 29th. Robert W. Baird increased their price objective on onsemi from $100.00 to $108.00 and gave the company a “neutral” rating in a research report on Tuesday. Zacks Research downgraded onsemi from a “strong-buy” rating to a “hold” rating in a report on Monday, July 6th. Finally, Evercore reissued an “outperform” rating and issued a $137.00 price target on shares of onsemi in a research note on Friday, June 26th. Fourteen investment analysts have rated the stock with a Buy rating, fourteen have assigned a Hold rating and one has issued a Sell rating to the company’s stock. Based on data from MarketBeat, the stock has an average rating of “Hold” and an average target price of $102.00.

Trending Headlines about onsemi

Here are the key news stories impacting onsemi this week:

• Positive Sentiment: Q2 earnings and revenue exceeded expectations. onsemi reported adjusted EPS of $0.74 versus the $0.72 consensus estimate and revenue of approximately $1.604 billion versus expectations of $1.59 billion. Revenue increased 9% year over year, while adjusted gross margin reached 39.3%. onsemi Reports Second Quarter 2026 Results
• Positive Sentiment: AI data-center demand is becoming a meaningful growth driver. Management said it is prioritizing AI infrastructure customers and expects data-center revenue to more than double in 2026. The company highlighted rising demand for high-voltage power solutions and other products used in AI applications. ON Semiconductor Shifts Capacity to AI Data Centers
• Positive Sentiment: Cash generation and shareholder returns improved sharply. Operating cash flow rose 150% year over year, free cash flow reached $425.4 million and onsemi repurchased $332 million of stock during the quarter. Stocks to Watch: ON Semiconductor
• Neutral Sentiment: Third-quarter guidance was broadly encouraging but not a major upside surprise. onsemi projected adjusted EPS of $0.81–$0.93 and revenue near $1.7 billion, roughly in line with analyst expectations. The midpoint implies continued sequential growth, but investors may have wanted a larger forecast increase given the AI enthusiasm.
• Negative Sentiment: AI growth requires reallocating capacity away from automotive and industrial customers. Automotive remains a major part of onsemi’s business, so prioritizing data centers could raise concerns about near-term automotive sales, customer relationships and the pace of the broader cyclical recovery.
• Negative Sentiment: Analysts remain cautious on the risk-reward profile. Baird raised its price target to $108 from $100 but maintained a Hold rating, citing margin tailwinds that are partly offset by competitive pressures. With the stock trading well above its 200-day average and at a relatively high earnings multiple, the results may have been largely anticipated. ON Semi Price Target Raised to $108

About onsemi

onsemi is engaged in disruptive innovations and also a supplier of power and analog semiconductors. The firm offers vehicle electrification and safety, sustainable energy grids, industrial automation, and 5G and cloud infrastructure, with a focus on automotive and industrial end-markets. It operates through the following segments: Power Solutions Group, Advanced Solutions Group, and Intelligent Sensing Group. The Power Solutions Group segment offers discrete, module, and semiconductor products that perform multiple application functions, including power switching, power conversion, signal conditioning, circuit protection, signal amplification, and voltage reference functions.