Earnings per share increases four times faster than revenue year-over-year
SCOTTSDALE, Ariz., – August 3, 2026 – onsemi (the “Company”) (Nasdaq: ON) today announced its second quarter 2026 results with the following highlights:
- Revenue of $1,604 million, increasing 9% year-over-year
- GAAP gross margin of 38.4% and non-GAAP gross margin of 39.3%
- GAAP operating margin of 16.1% and non-GAAP operating margin 20.8%
- GAAP diluted earnings per share of $0.56 and non-GAAP diluted earnings per share $0.74
- Cash from operations increased by 150% and free cash flow of $425.4 million quadrupled year-over-year
- Share repurchases of $332 million, bringing year-to-date shareholder returns to approximately 105% of free cash flow
“We delivered revenue, gross margin and earnings per share above the midpoint of guidance, reflecting strengthening demand, particularly across AI-driven applications, and growing customer adoption of our differentiated solutions, including Treo and our high voltage power solutions,” said Hassane El-Khoury, President and CEO of onsemi. “AI data center remains our fastest-growing business, and we now expect revenue to more than double in 2026, demonstrating the strength of our intelligent power portfolio and growing customer adoption across the power tree.”
“Our results demonstrate the operating leverage in our business model,” said Thad Trent, EVP and CFO of onsemi. “Year-over-year earnings per share grew four times faster than revenue, driven by gross margin expansion and disciplined cost management. Free cash flow margin expanded from approximately 7% to 27% year-over-year, reflecting the strength of our operating model, and as demand continues to improve, we are increasingly confident in our ability to drive profitable growth and long-term shareholder value.”
Business Highlights:
- Announced the planned acquisition of Synaptics, expanding capabilities in connected compute at accretive gross margins to support a market expansion while complementing leadership in power and sensing
- Expanded role in NVIDIA MGX ecosystem as AI infrastructure power demands accelerate
- Secured strategic AI data center platform wins with Great Wall, a leading China cloud infrastructure power supplier, expanding EliteSiC and silicon MOSFETs and controller content
- Launched GaNEXUS, onsemi's gallium nitride power portfolio spanning 40V to 650V, serving AI data centers, robotics, and industrial infrastructure applications
- Extended leadership in automotive zonal architecture and on-board charging with Rivian’s R2 platform with power solutions that enable efficient power distribution and conversion
* Diluted shares outstanding can vary as a result of, among other things, the vesting of restricted stock units, the incremental dilutive shares from the convertible notes, and the repurchase or the issuance of stock or convertible notes or the sale of treasury shares. In periods when the quarterly average stock price per share exceeds $52.97 for the 0% Notes, $103.87 for the 0.50% Notes, and $161.30 for the 2031 0% Notes, the non-GAAP diluted share count and non-GAAP net income per share include the anti-dilutive impact of the hedge transactions entered concurrently with the 0% Notes, the 0.50% Notes, and the 2031 0% Notes, respectively. At an average stock price per share between $52.97 and $74.34 for the 0% Notes, $103.87 and $156.78 for the 0.50% Notes, and $161.30 and $211.54 for the 2031 0% Notes, the hedging activity offsets the potentially dilutive effect of the 0% Notes, the 0.50% Notes, and the 2031 0% Notes, respectively. In periods when the quarterly average stock price exceeds $74.34 for the 0% Notes, $156.78 for the 0.50% Notes, and $211.54 for the 2031 0% Notes, the dilutive impact of the warrants issued concurrently with such notes is included in the diluted shares outstanding. GAAP and non-GAAP diluted share counts are based on either the previous quarter's average stock price or the stock price as of the last day of the previous quarter, whichever is higher.
** Special items may include: amortization of acquisition-related intangibles; expensing of appraised inventory fair market value step-up; restructuring-related cost of revenue charges; non-recurring facility costs; in-process research and development expenses; restructuring, asset impairments and other, net; goodwill impairment charges; gains and losses on debt prepayment; actuarial (gains) losses on pension plans and other pension benefits; and certain other special items, as necessary. These special items are out of our control and could change significantly from period to period. As a result, we are not able to reasonably estimate and separately present the individual impact or probable significance of these special items, and we are similarly unable to provide a reconciliation of the non-GAAP measures. The reconciliation that is unavailable would include a forward-looking income statement, balance sheet and statement of cash flows in accordance with GAAP. For this reason, we use a projected range of the aggregate amount of special items in order to calculate our projected non-GAAP operating expense outlook.
*** We believe these non-GAAP measures provide important supplemental information to investors. We use these measures, together with GAAP measures, for internal managerial purposes and as a means to evaluate period-to-period comparisons. However, we do not, and you should not, rely on non-GAAP financial measures alone as measures of our performance. We believe that non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when taken together with GAAP results and the reconciliations to corresponding GAAP financial measures that we also provide in our releases, provide a more complete understanding of factors and trends affecting our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures, even if they have similar names.
TELECONFERENCE
onsemi will host a conference call for the financial community at 5 p.m. Eastern Time (ET) on August 3, 2026 to discuss this announcement and onsemi’s second quarter 2026 results. The Company will also provide a real-time audio webcast of the teleconference on the Investor Relations page of its website at http://www.onsemi.com. The webcast replay will be available at this site approximately one hour following the live broadcast and will continue to be available for approximately 30 days following the conference call. Investors and interested parties can also access the conference call by pre-registering here.
FORWARD LOOKING STATEMENTS
This document includes “forward-looking statements,” as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included or incorporated in this document could be deemed forward-looking statements, particularly statements about the future financial performance of onsemi, including financial guidance for the third quarter of 2026. Forward-looking statements are often characterized by the use of words such as “believes,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “anticipates,” “should” or similar expressions or by discussions of strategy, plans or intentions. All forward-looking statements in this document are made based on our current expectations, forecasts, estimates and assumptions and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. Certain factors that could affect our future results or events are described under Part I, Item 1A “Risk Factors” in the 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 9, 2026 (the “2025 Form 10-K”) and from time to time in our other SEC reports. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information, which speaks only as of the date made, except as may be required by law. Investing in our securities involves a high degree of risk and uncertainty, and you should carefully consider the trends, risks and uncertainties described in this document, our 2025 Form 10-K and other reports filed with or furnished to the SEC before making any investment decision with respect to our securities. If any of these trends, risks or uncertainties actually occurs or continues, our business, financial condition or operating results could be materially adversely affected, the trading prices of our securities could decline, and you could lose all or part of your investment. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.
FINANCIALS
