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onsemi announced results for the first quarter of 2024 with the following highlights:
- Revenue of $1,862.7 million
- GAAP gross margin and non-GAAP gross margin of 45.8% and 45.9%, respectively
- GAAP operating margin and non-GAAP operating margin of 28.2% and 29.0%, respectively
- GAAP diluted earnings per share and non-GAAP diluted earnings per share of $1.04 and $1.08, respectively
- Returned ~100% of free cash flow over last twelve months to shareholders through stock repurchases
“The structural changes we have made to the business over the last three years have enabled us to sustain our gross margin despite challenging market conditions,” said Hassane El-Khoury, president and chief executive officer of onsemi. “In the current environment, we remain focused on execution while investing for our long-term growth. As power continues to play a critical role in the world’s increasing energy demands, efficiency is paramount, and we are positioned to continue to gain share with our portfolio of industry-leading power and sensing technologies.”
Selected financial results for the quarter are shown below with comparable periods (unaudited):
GAAP Non-GAAP (Revenue and Net Income in millions) Q1 2024 Q4 2023 Q1 2023 Q1 2024 Q4 2023 Q1 2023 Revenue $ 1,862.7 $ 2,018.1 $ 1,959.7 $ 1,862.7 $ 2,018.1 $ 1,959.7 Gross Margin 45.8 % 46.7 % 46.8 % 45.9 % 46.7 % 46.8 % Operating Margin 28.2 % 30.3 % 28.8 % 29.0 % 31.6 % 32.2 % Net Income attributable to ON Semiconductor Corporation $ 453.0 $ 562.7 $ 461.7 $ 464.5 $ 540.9 $ 523.7 Diluted Earnings Per Share $ 1.04 $ 1.28 $ 1.03 $ 1.08 $ 1.25 $ 1.19 Revenue Summary (in millions) (Unaudited) Three Months Ended Business Segment(1) Q1 2024 Q4 2023 Q1 2023 Sequential Change Year-over-Year Change PSG $ 874.2 $ 965.5 $ 860.9 (9 )% 2 % AMG 697.0 744.9 744.7 (6 )% (6 )% ISG 291.5 307.7 354.1 (5 )% (18 )% Total $ 1,862.7 $ 2,018.1 $ 1,959.7 (8 )% (5 )% (1) During the first quarter of 2024, the Company reorganized certain reporting units and its segment reporting structure. As a result of the reorganization of divisions within PSG and AMG, the prior-period amounts have been reclassified to conform to current-period presentation. SECOND QUARTER 2024 OUTLOOK
The following table outlines onsemi’s projected second quarter of 2024 GAAP and non-GAAP outlook.
Total onsemiGAAP SpecialItems Total onsemiNon-GAAP Revenue $1,680 to $1,780 million – $1,680 to $1,780 million Gross Margin 44.1% to 46.1% 0.1% 44.2% to 46.2% Operating Expenses $327 to $342 million $14 million $313 to $328 million Other Income and Expense (including interest), net ($12 million) – ($12 million) Diluted Earnings Per Share $0.82 to $0.94 $0.04 $0.86 to $0.98 Diluted Shares Outstanding 436 million 4 million 432 million Original – onsemi
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onsemi announced the formation of the Analog and Mixed-Signal Group (AMG) which will be led by newly appointed group president, Sudhir Gopalswamy. The group will be focused on expanding onsemi’s portfolio of industry-leading power management and sensor interface devices to unlock an additional $19.3 billion total addressable market and accelerate the company’s growth in the automotive, industrial and cloud end markets.
Additionally, Simon Keeton has been promoted to group president of the Power Solutions Group (PSG). His leadership has been instrumental in delivering more than $4 billion in total revenue last year, while ramping a profitable silicon carbide business that achieved over $800 million in revenue in 2023.
“This organizational alignment builds on our strength in delivering highly differentiated and optimized solutions focused on customer needs,” said Hassane El-Khoury, president and chief executive officer of onsemi. “With Simon and Sudhir’s industry expertise and proven track records, we are setting the foundation for further growth and leadership in intelligent power and sensing technologies.”
AMG specializes in the development of a range of power management ICs and high precision, low power sensor interfaces and communications products. It positions onsemi to become a full suite provider of high efficiency power tree solutions with an expanded portfolio of gate drivers, DC-DC converters, multi-phase controllers, eFuses and more.
The group will continue to extend its leadership in automotive- and industrial-focused sensor interface and communication solutions such as inductive, ultrasonic and medical sensing, as well as single-pair Ethernet and Bluetooth® Low Energy (Bluetooth LE) solutions.
AMG combines the former Advanced Solutions Group (ASG) and Integrated Circuits Division (ICD), previously a part of PSG. Gopalswamy will oversee both AMG and Intelligent Sensing Group (ISG), which together drove nearly $4 billion in revenue for the company last year.
This strategic move accelerates onsemi’s position and will add even more system value for customers by powering every architecture with analog and mixed-signal technologies that enable advanced functionality, higher performance and faster time to market.
onsemi will publish its first quarter 2024 earnings based on the reorganized business segments and provide comparable historical data.
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onsemi announced the availability of its 1200V SPM31 Intelligent Power Modules (IPMs) featuring the latest generation Field Stop 7 (FS7) Insulated Gate Bipolar Transistor (IGBT) technology. The SPM31 IPMs deliver higher efficiency, smaller footprint and higher power density resulting in lower total system cost than other leading solutions on the market.
Given the greater efficiency realized using optimized IGBTs, these IPMs are ideal for three-phase inverter drive applications such as heat pumps, commercial HVAC systems, servo motors, and industrial pumps and fans.
Operating residential and commercial buildings is estimated to contribute 26% of greenhouse gas emissions, with indirect emissions such as heating, cooling and powering buildings accounting for approximately 18%. As governments worldwide strive to meet their energy and climate commitments, more energy-efficient and lower-carbon solutions are becoming increasingly critical.
The SPM31 IPMs control the power flow to the inverter compressor and fans in heat pumps and air conditioning systems by adjusting the frequency and voltage of the power supplied to three-phase motors for maximum efficiency. For example, onsemi’s 25A-rated SPM31 using FS7 IGBT technology can decrease power losses by up to 10% and increase in power density up to 9%, compared to our previous generation products.
With the transition to electrification and heightened efficiency mandates, these modules help manufacturers drastically improve system design while increasing efficiency in heating and cooling applications. With the improved performance, our SPM31 IPM family featuring FS7 enables high efficiency with reduced energy losses, further reducing harmful emissions globally.
These highly integrated modules contain gate-driving ICs, multiple on-module protection features along with our FS7 IGBTs enabling industry-leading thermal performance with the ability to support a wide range of currents, from 15A to 35A. With their best-in-class power density, SPM31 FS7 IGBT IPMs are an ideal answer to save mounting space and improve performance expectations while shortening the development time. In addition, the SPM31 IPMs include the following benefits:
- Controls for gate drivers and protections
- Low loss, short-circuit-rated IGBTs
- Negative IGBT terminals available for each phase to support a wide variety of control algorithms
- Built-in under-voltage protection (UVP)
- Built-in bootstrap diodes and resistors
- Built-in high-speed high-voltage integrated circuit
- Single-grounded power supply
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onsemi announced its fourth quarter and fiscal year 2023 results with the following highlights:
- Fourth quarter revenue of $2,018.1 million
- Fourth quarter GAAP and non-GAAP gross margin of 46.7%
- GAAP operating margin and non-GAAP operating margin of 30.3% and 31.6%, respectively
- GAAP diluted earnings per share and non-GAAP diluted earnings per share of $1.28 and $1.25, respectively
- Full year 2023 record automotive revenue of $4.3 billion increased 29% year-over-year
- Full year 2023 share repurchases of $564 million, representing 140% of free cash flow
“Our momentum continued this past year as we achieved record automotive revenue and 4x year-over-year growth in silicon carbide revenue. We continue to transform the business by building resilience into our model, enabling us to navigate uncertain market conditions and deliver more predictable and sustainable results,” said Hassane El-Khoury, president and chief executive officer of onsemi.
“Our consistent performance has validated our long-term strategy. Looking ahead, we are driving innovation beyond silicon and silicon carbide with our upcoming analog and mixed signal platform to further our leadership in intelligent power and sensing solutions.”
Original – onsemi
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onsemi announced the availability of nine new EliteSiC Power Integrated Modules (PIMs) enabling bidirectional charging capabilities for DC ultra-fast electric vehicle (EV) chargers and energy storage systems (ESS). The silicon carbide-based solutions will dramatically improve system cost with higher efficiency and simpler cooling mechanisms that can reduce size by up to 40% and weight by up to 52% compared to traditional silicon-based IGBT solutions.
With more compact, lighter charging platforms, designers will have all the key building blocks that are needed to quickly deploy a reliable, efficient and scalable network of DC fast chargers that can charge electric vehicle batteries up to 80% in as little as 15 minutes.
According to J.D. Power’s 2023 Electric Vehicle Consideration Study, nearly half of U.S. consumers note the reason for not purchasing an electric vehicle is the access to charging and the ability to do so quickly, to ensure the driving experience is as easy and seamless as with a traditional internal combustion engine (ICE) vehicle. In the U.S., the availability of EV chargers needs to quadruple by 2025 and 8x by the end of the decade to keep up with demand and ensure drivers have equitable access to public charging stations.
In turn, this rapid increase in demand for electricity will also put a tremendous strain on current electrical grids, potentially overloading them. To mitigate this problem, bidirectional charging has emerged as a key solution to implement vehicle-to-grid which allows both regular battery charging and the ability to use an EV as an energy storage system to power your home when needed.
This solution helps enable a DC fast charging network and vehicle-to-grid power transfer systems, addressing access and speed with its ability to recharge a vehicle faster than other methods that take hours or even days.
onsemi offers the most comprehensive portfolio of PIMs to address the key topologies on the market. This gives designers the flexibility to pick the right PIM for power conversion stages in their DC fast charging or energy storage system applications. To accelerate the design cycle, advanced piecewise linear electrical circuit simulation (PLECS) models through our Self-Service PLECS model Generator and application simulation with the Elite Power Simulator of this portfolio will also be made available to designers.
For each module, onsemi uses die from the same wafer to ensure more consistency and reliability so designers don’t have to use discretes from different suppliers, which can lead to varying performance results. In addition to its reliability, this module portfolio offers the following benefits:
- Uses the Gen3 M3S SiC MOSFET technology which offers the lowest switching losses and highest efficiency in the industry
- Supports key topologies such as multi-level T-type neutral point clamp (TNPC), half-bridge and full-bridge topologies
- Supports scalable output power from 25 kW to 100 kW, enabling multiple DC fast charging and energy storage systems platforms including bidirectional charging
- Industry-standard F1 and F2 packages with the option of pre-applied Thermal Interface Material (TIM) and press fit pins
- Enables optimal thermal management, avoiding system failure due to overheating
- Full SiC modules offer energy conservation by minimizing power losses, directly translating to cost and energy savings
- Offers more robustness and dependability, ensuring consistent operations
Original – onsemi
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onsemi opened an application test lab in Piestany, Slovakia, focused on the advancement of system solutions for battery/plug-in hybrid/electric vehicles (xEVs) and energy infrastructure (EI) power conversion systems. The state-of-the-art systems applications lab provides specialized equipment to develop and test next-generation silicon (Si) and silicon carbide (SiC) semiconductor solutions in collaboration with automotive OEMs, Tier 1s and EI providers.
Modern semiconductor devices are essential for highly efficient power conversion in xEV powertrains and charging, as well as applications in renewable energy. The new lab will play a central role in ensuring that the development of future power products results in highly differentiated, value-add solutions tailored to customers’ specific requirements.
The new facility consists of two high-voltage power labs that focus on systems and device level development as well as evaluation of SiC/Si traction inverters and ACDC/DCDC power converters. Laser welding facilities, mechanical clean rooms and workshops further enable fast prototyping and testing of next-generation system solutions.
Evaluation capabilities for the next-generation system solutions include:
- Continuous 24/7 testing
- Internally developed and patented software and hardware solutions to support high-voltage power cycling via space vector modulation (SVM) and sinusoidal pulse width modulation (SPWM)
- High-accuracy logging devices for assessing SiC and Si health and reliability
- Simulation of the harsh conditions faced by inverters during operation, testing liquid-cooled devices at temperatures as low as minus 50 degrees C and up to 220 degrees C
- Wider range of industry-recognized software allows for the programing of FPGAs and ARM microcontrollers on site, as well as qualification testing, data analysis and 3D modeling
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onsemi announced results for the third quarter of 2023 with the following highlights:
- Revenue of $2,180.8 million; GAAP and non-GAAP gross margin of 47.3%
- GAAP operating margin and non-GAAP operating margin of 31.5% and 32.6%, respectively
- GAAP diluted earnings per share and non-GAAP diluted earnings per share of $1.29 and $1.39, respectively
- Record automotive revenue of $1.2 billion, and increased 33% year-over-year
- Record industrial revenue of $616 million, up slightly year-over-year
“Our disciplined approach and execution resulted in another solid quarter, demonstrating the resilience in our business amid market softness,” said Hassane El-Khoury, president and chief executive officer, onsemi.
“We continue to drive structural improvements and efficiencies, most notably in our silicon carbide operation, with the completed expansion of the world’s largest, state-of-the-art silicon carbide fab in South Korea for 150- and 200-millimeter wafers.”
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onsemi announced the completed expansion of its state-of-the-art, world-largest silicon carbide (SiC) fabrication facility in Bucheon, South Korea. At full capacity, this fab will be able to manufacture more than one million 200 mm SiC wafers per year.
To support the ramp in SiC manufacturing capacity, onsemi plans to hire up to 1,000 local employees over the next three years to fill the mostly highly technical positions – a more than 40% increase over the present workforce of about 2,300.
Silicon carbide devices are a critical component for power conversion in electric vehicles (EVs), energy infrastructure and high-power EV chargers. The rapidly growing demand for these products has created a surge in demand for SiC chips, with demand outpacing supply for the foreseeable future. The expansion of the Bucheon fab addresses the pressing need for additional production capacity, allowing onsemi to continue to provide supply assurance for its customers and strengthen its leadership in intelligent power solutions.
Construction of the new advanced 150 mm/200 mm SiC fab line along with the high-tech utility building and adjacent parking garage began in the middle of 2022 and was completed in September 2023. The expansion of the 150 mm/200 mm SiC Epi and wafer fab emphasizes onsemi’s focus on building out its vertically integrated silicon carbide manufacturing supply chain at brownfield locations. The Bucheon SiC line is starting with the production of 150 mm wafers and will be converted to 200 mm in 2025 upon qualification of the 200 mm SiC process.
onsemi’s leadership was joined by a delegation of dignitaries led by Vice Governor for Economy of the Gyeonggi-Do Taeyoung Yeom; followed by Bucheon City Mayor YongEek Cho; National Assembly delegates; and Bucheon Chamber of Commerce and Industry Chairman JongHuem Kim. Also in attendance were representatives from local communities, customers, suppliers and the semiconductor industry.
onsemi CEO Hassane El-Khoury opened the event, noting, “The 150 mm/200 mm SiC wafer fab in Bucheon is critical to the continued success of our fully integrated SiC supply chain, enabling us to support the acceleration of electrification globally. The last five years have shown what extraordinary performance our Bucheon team is capable of, and what we can achieve when we work together with governmental agencies toward the common goal of a more sustainable future.”
“I am truly impressed by onsemi’s diligent and yet fast execution of its strategic plan to expand the Bucheon SiC wafer fab,” said Bucheon City Mayor YongEek Cho. “Not only will the city of Bucheon benefit from the creation of new employment opportunities in technology, but it will also be a part of laying the foundation for a sustainable ecosystem through electrification.”
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onsemi announced that Christina Lampe-Önnerud was appointed to its board of directors, effective September 1, 2023.
Lampe-Önnerud is a highly regarded founder and business leader, having served as chief executive officer of two separate companies, and is also considered an expert in the energy storage space. Among her unique global experience, she has been active in multiple domestic and international government delegations as an authority on energy technologies.
As a two-time World Economic Forum (WEF) Technology Pioneer, who has served as co-chairman of the WEF Global Future Council on Energy, she continues to be engaged in multiple initiatives throughout the United States, Europe and Asia.
“Christina brings a wealth of experience as a pioneer and innovator in battery technologies designed to improve energy storage and power consumption,” said Alan Campbell, chair of onsemi’s board of directors. “Her work, values and passion are well-aligned with onsemi’s strategic priorities focused on delivering innovative technologies for the automotive and industrial end-markets that deliver a sustainable future, and we look forward to her invaluable contributions to the board.”
“onsemi’s ambition to deliver industry-leading power and sensing technologies that will transform our world’s energy usage is where I’ve dedicated my life’s work,” said Christina Lampe-Önnerud. “It is an exciting time to be joining the board to support the leadership team as they continue to execute on the strategy and drive long-term shareholder value and sustainable results.”
Lampe-Önnerud holds more than 80 patents on designs, products, devices, components, materials, and processes. She has over 25 technical publications in scientific journals focusing on science and thought leadership. She is also frequently tapped as an expert commentator in media interviews and regularly speaks at government and industry conferences on power and energy issues.
Lampe-Önnerud received both a Bachelor of Science degree in chemistry and calculus and a Ph.D. in inorganic chemistry from Uppsala University, Sweden. She completed her post-doctorate at Massachusetts Institute of Technology, where she serves on the Visiting Committee. In 2022, she was honored with the King’s Medal, one of Sweden’s most prestigious awards, for her work in producing safe, low-cost, high-performance lithium-ion batteries.
Original – onsemi
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onsemi and Magna announced a long-term supply agreement (LTSA) for Magna to integrate onsemi’s EliteSiC intelligent power solutions into its eDrive systems.
By integrating onsemi’s industry-leading EliteSiC MOSFET technology, Magna eDrive systems can offer better cooling performance and faster acceleration and charging rates, improving efficiency and increasing the range of electric vehicles (EVs). Additionally, onsemi’s end-to-end silicon carbide (SiC) manufacturing capability, combined with its ability to ramp production quickly, improves Magna’s vertical integration and simplifies its supply chain to meet the growing demand for its SiC-based products for EVs.
“With range anxiety still a top deterrent to EV adoption, our technology enables Magna to go further, easing the transition to an electrified future,” said Asif Jakwani, senior vice president and general manager, Advanced Power Division, onsemi. “Our latest EliteSiC MOSFET technology enables increased power density and higher efficiency in traction inverters, resulting in improved gas-equivalent miles per gallon without compromising driving dynamics and safety.”
Simultaneous with the signing of the LTSA, the companies entered a separate agreement for Magna to also invest approximately $40 million for the procurement of new SiC equipment at onsemi’s New Hampshire and Czech Republic facilities to ensure access to future supply.
“We believe that a secure supply of silicon carbide chips will be critical to our ability to continue delivering innovative and efficient eDrive systems for our customers,” said Diba Ilunga, president Magna Powertrain. “Accordingly, we are both investing to grow SiC production capacity, and establishing the commercial basis for long-term supply of SiC-based chips to advance our electrification strategy and outpace the competition.”
Silicon carbide is a wide bandgap semiconductor substrate that is ideal for high-temperature, high-power applications such as electric vehicles, but it is incredibly difficult to produce. With a limited number of manufacturers and significant demand for SiC-based designs, OEMs and automotive suppliers are increasingly looking to secure long-term, reliable supply.
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