ON Semiconductor's revenue reaches 1.4 billion! Demand in China and Europe continues to grow
US chipmaker ON Semiconductor released its first-quarter financial report, with revenue and adjusted earnings per share both exceeding market expectations, and raised its second-quarter financial forecast. Even under the pressure of automobile tariffs and weak global demand, the company still showed confidence in the demand in the electric vehicle field.ON Semiconductor's revenue last quarter reached $1.45 billion, which was 22% lower than the same period last year, but better than Wall Street's estimate of $1.4 billion; adjusted earnings per share were $0.55, also higher than the market's expectation of $0.50. However, the company turned to a net loss of $486 million due to an accounting loss, compared with a profit of $453 million in the same period last year.
ON Semiconductor CEO Hassane El-Khoury pointed out that during the low tide of the business cycle, the company still maintained financial discipline and long-term strategic advancement, "This financial report reflects our solid execution capabilities."
ON Semiconductor's main product is silicon carbide (SiC) chips, which are widely used in electric vehicle endurance systems. The company said that the demand for EVs from China and Europe continued to grow in the first quarter, helping to stabilize orders.
However, apart from the development momentum of the Chinese and European markets, there is no obvious sign of recovery in other countries such as the Korean market. For this reason, ON Semiconductor stopped investing in its silicon carbide (SiC) power management IC factory in South Korea last month and recalled most of the engineers from the Bucheon factory in Gyeonggi Province, South Korea to the United States. Currently, there are only some researchers in the factory, and these researchers are expected to be reorganized.
Faced with the dual pressures of cost and demand, ON Semiconductor announced in February that it would lay off 9% of its employees worldwide, about 2,400 employees, to strengthen capital utilization and organizational efficiency. Last month, ON Semiconductor also canceled its $6.9 billion acquisition of small competitor Allegro MicroSystems because the other party's board of directors was unwilling to fully consider the acquisition proposal.
Looking ahead to the second quarter, ON Semiconductor is optimistic that the electric vehicle market will remain strong, driving steady shipments of silicon carbide (SiC) chip products. Single-quarter revenue is expected to reach US$1.4 billion to US$1.5 billion, and adjusted earnings per share are estimated to be between US$0.48 and US$0.58. The midpoints are both higher than Wall Street's expectations of US$1.41 billion and US$0.51.
