onsemi Reports Third Quarter 2024 Results
onsemi reported Q3 2024 results with revenue of $1,761.9 million, exceeding expectations. The company achieved GAAP gross margin of 45.4% and operating margin of 25.3%. GAAP diluted earnings per share reached $0.93, while non-GAAP EPS was $0.99. The company returned 75% of free cash flow to shareholders through stock repurchases over the last 12 months. For Q4 2024, onsemi projects revenue between $1,710-$1,810 million with gross margin of 43.9-45.9%. Despite a year-over-year revenue decline of 19%, the company saw sequential growth of 2% from Q2 2024.
onsemi ha riportato i risultati del terzo trimestre 2024 con ricavi di 1.761,9 milioni di dollari, superando le aspettative. L'azienda ha raggiunto un margine lordo GAAP del 45,4% e un margine operativo del 25,3%. L'utile per azione diluito GAAP ha raggiunto i 0,93 dollari, mentre l'EPS non-GAAP è stato di 0,99 dollari. L'azienda ha restituito il 75% del flusso di cassa libero agli azionisti attraverso riacquisti di azioni negli ultimi 12 mesi. Per il quarto trimestre 2024, onsemi prevede ricavi compresi tra 1.710 e 1.810 milioni di dollari con un margine lordo tra il 43,9% e il 45,9%. Nonostante un calo del 19% dei ricavi su base annuale, l'azienda ha registrato una crescita sequenziale del 2% rispetto al secondo trimestre 2024.
onsemi informó los resultados del tercer trimestre de 2024 con ingresos de 1,761.9 millones de dólares, superando las expectativas. La empresa alcanzó un margen bruto GAAP del 45.4% y un margen operativo del 25.3%. Las ganancias por acción diluida GAAP alcanzaron 0.93 dólares, mientras que las ganancias por acción no GAAP fueron de 0.99 dólares. La compañía devolvió el 75% del flujo de caja libre a los accionistas a través de recompras de acciones en los últimos 12 meses. Para el cuarto trimestre de 2024, onsemi proyecta ingresos entre 1,710 y 1,810 millones de dólares con un margen bruto del 43.9% al 45.9%. A pesar de una caída en los ingresos del 19% interanual, la empresa vio un crecimiento secuencial del 2% respecto al segundo trimestre de 2024.
onsemi는 2024년 3분기 실적을 발표하며 수익이 17억 6,190만 달러에 달해 기대치를 초과했다고 밝혔습니다. 회사는 GAAP 총 이익률 45.4%와 운영 이익률 25.3%를 달성했습니다. GAAP 희석 주당순이익은 0.93달러에 도달했으며, 비 GAAP EPS는 0.99달러였습니다. 회사는 지난 12개월 동안 주식 매입을 통해 자유 현금 흐름의 75%를 주주에게 환원했습니다. 2024년 4분기 위해 onsemi는 수익을 17억 1,000만~18억 1,000만 달러로 예상하며 총 이익률은 43.9%~45.9%에 이를 것으로 보입니다. 전년 대비 19%의 매출 감소에도 불구하고 회사는 2024년 2분기 대비 2%의 순 성장률을 기록했습니다.
onsemi a annoncé les résultats du troisième trimestre 2024 avec des revenus de 1,761.9 millions de dollars, dépassant les attentes. L'entreprise a atteint une marge brute GAAP de 45,4% et une marge opérationnelle de 25,3%. Le bénéfice par action dilué GAAP a atteint 0,93 dollar, tandis que le BPA non-GAAP était de 0,99 dollar. L'entreprise a restitué 75% de son flux de trésorerie libre aux actionnaires par le biais de rachats d'actions au cours des 12 derniers mois. Pour le quatrième trimestre 2024, onsemi prévoit des revenus compris entre 1,710 et 1,810 millions de dollars avec une marge brute de 43,9% à 45,9%. Malgré une baisse des revenus de 19% d'une année sur l'autre, l'entreprise a constaté une croissance séquentielle de 2% par rapport au deuxième trimestre 2024.
onsemi berichtete über die Ergebnisse des 3. Quartals 2024 mit einem Umsatz von 1.761,9 Millionen US-Dollar, der die Erwartungen übertraf. Das Unternehmen erzielte eine GAAP-Bruttomarge von 45,4% und eine operative Marge von 25,3%. Der GAAP verwässerte Gewinn pro Aktie erreichte 0,93 US-Dollar, während das nicht-GAAP EPS bei 0,99 US-Dollar lag. Das Unternehmen gab 75% des freien Cashflows in den letzten 12 Monaten an die Aktionäre durch Aktienrückkäufe zurück. Für das 4. Quartal 2024 prognostiziert onsemi einen Umsatz zwischen 1.710 und 1.810 Millionen US-Dollar mit einer Bruttomarge von 43,9% bis 45,9%. Trotz eines Umsatzrückgangs von 19% im Jahresvergleich verzeichnete das Unternehmen ein sequenzielles Wachstum von 2% im Vergleich zum 2. Quartal 2024.
- Sequential revenue growth of 2% to $1,761.9 million
- Gross margin improved to 45.4% from 45.2% in Q2 2024
- Operating margin increased to 28.2% from 27.5% quarter-over-quarter
- 75% of free cash flow returned to shareholders via stock repurchases
- ISG segment showed 11% sequential growth
- 19% year-over-year revenue decline
- PSG segment revenue decreased 23% year-over-year
- AMG segment revenue dropped 16% year-over-year
- Expected gross margin decline in Q4 guidance (43.9-45.9%)
- EPS declined from $1.29 to $0.93 year-over-year
Insights
The Q3 2024 results show mixed signals. While revenue of
Key positives include
The automotive and industrial segments show resilience despite market headwinds, with the ISG segment growing
Revenue and earnings exceed expectations with free cash flow increasing
-
Revenue of
$1,761.9 million -
GAAP gross margin and non-GAAP gross margin of
45.4% and45.5% , respectively -
GAAP operating margin and non-GAAP operating margin of
25.3% and28.2% , respectively -
GAAP diluted earnings per share and non-GAAP diluted earnings per share of
$0.93 $0.99 -
Returned
75% of free cash flow over the last 12 months to shareholders through stock repurchases
“With third-quarter results above expectations, we remain focused on delivering consistent results in the current environment through execution and prudent financial management,” said Hassane El-Khoury, president and CEO, onsemi. “As power demands continue to rise across our key markets, and the need for greater efficiency becomes paramount, we are investing to win across the entire power spectrum to ensure that onsemi is best positioned to gain share in automotive, industrial and AI data center.”
Selected financial results for the quarter are shown below with comparable periods (unaudited):
|
GAAP |
|
Non-GAAP |
|||||||||
(Revenue and Net Income in millions) |
Q3 2024 |
Q2 2024 |
Q3 2023 |
|
Q3 2024 |
Q2 2024 |
Q3 2023 |
|||||
Revenue |
|
|
|
|
|
|
|
|||||
Gross Margin |
45.4 % |
45.2 % |
47.3 % |
|
45.5 % |
45.3 % |
47.3 % |
|||||
Operating Margin |
25.3 % |
22.4 % |
31.5 % |
|
28.2 % |
27.5 % |
32.6 % |
|||||
Net Income attributable to ON Semiconductor Corporation |
|
|
|
|
|
|
|
|||||
Diluted Earnings Per Share |
|
|
|
|
|
|
|
|||||
Revenue Summary
(in millions)
(Unaudited)
|
Quarters Ended |
|
|
||||||||||
Business Segment(1) |
Q3 2024 |
Q2 2024 |
Q3 2023 |
Sequential
|
Year-over-
|
||||||||
PSG |
$ |
829.4 |
$ |
835.2 |
$ |
1,076.5 |
(1)% |
(23)% |
|||||
AMG |
|
653.7 |
|
647.8 |
|
775.7 |
1 % |
(16)% |
|||||
ISG |
|
278.8 |
|
252.2 |
|
328.6 |
11 % |
(15)% |
|||||
Total |
$ |
1,761.9 |
$ |
1,735.2 |
$ |
2,180.8 |
2 % |
(19)% |
|||||
(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. |
|||||||||||||
FOURTH QUARTER 2024 OUTLOOK
The following table outlines onsemi’s projected fourth quarter of 2024 GAAP and non-GAAP outlook.
|
Total onsemi
|
|
Special
|
|
Total onsemi
|
|
Revenue |
|
|
- |
|
|
|
Gross Margin |
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
|
Other Income and Expense (including interest), net |
( |
|
- |
|
( |
|
Diluted Earnings Per Share |
|
|
|
|
|
|
Diluted Shares Outstanding * |
431 million |
|
4 million |
|
427 million |
* |
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 |
|
** |
Special items may include: amortization of acquisition-related intangibles; expensing of appraised inventory fair market value step-up; 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 9 a.m. Eastern Time (ET) on October 28, 2024 to discuss this announcement and onsemi’s 2024 third quarter 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.
About onsemi
onsemi (Nasdaq: ON) is driving disruptive innovations to help build a better future. With a focus on automotive and industrial end-markets, the company is accelerating change in megatrends such as vehicle electrification and safety, sustainable energy grids, industrial automation, and 5G and cloud infrastructure. onsemi offers a highly differentiated and innovative product portfolio, delivering intelligent power and sensing technologies that solve the world’s most complex challenges and leads the way to creating a safer, cleaner, and smarter world. onsemi is recognized as a Fortune 500® company and included in the Nasdaq-100 Index® and S&P 500® index. Learn more about onsemi at www.onsemi.com.
onsemi and the onsemi logo are trademarks of Semiconductor Components Industries, LLC. All other brand and product names appearing in this document are registered trademarks or trademarks of their respective holders. Although the Company references its website in this news release, information on the website is not to be incorporated herein.
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 fourth quarter of 2024. 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 2023 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 5, 2024 (the “2023 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 2023 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.
ON SEMICONDUCTOR CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
|
Quarters Ended |
|
Nine Months Ended |
|||||||||||||||||
|
September 27,
|
|
June 28, 2024 |
|
September 29,
|
|
September 27,
|
|
September 29,
|
|||||||||||
Revenue |
$ |
1,761.9 |
|
|
$ |
1,735.2 |
|
|
$ |
2,180.8 |
|
|
$ |
5,359.8 |
|
|
$ |
6,234.9 |
|
|
Cost of revenue |
|
962.5 |
|
|
|
951.2 |
|
|
|
1,150.1 |
|
|
|
2,922.8 |
|
|
|
3,293.3 |
|
|
Gross profit |
|
799.4 |
|
|
|
784.0 |
|
|
|
1,030.7 |
|
|
|
2,437.0 |
|
|
|
2,941.6 |
|
|
Gross margin |
|
45.4 |
% |
|
|
45.2 |
% |
|
|
47.3 |
% |
|
|
45.5 |
% |
|
|
47.2 |
% |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||||||||||
Research and development |
|
151.0 |
|
|
|
156.5 |
|
|
|
143.4 |
|
|
|
457.5 |
|
|
|
427.1 |
|
|
Selling and marketing |
|
65.4 |
|
|
|
68.6 |
|
|
|
68.2 |
|
|
|
203.1 |
|
|
|
211.6 |
|
|
General and administrative |
|
95.5 |
|
|
|
85.0 |
|
|
|
110.7 |
|
|
|
275.8 |
|
|
|
273.8 |
|
|
Amortization of acquisition-related intangible assets |
|
13.0 |
|
|
|
12.9 |
|
|
|
12.0 |
|
|
|
38.5 |
|
|
|
39.0 |
|
|
Restructuring, asset impairments and other charges, net |
|
29.1 |
|
|
|
72.5 |
|
|
|
9.4 |
|
|
|
103.0 |
|
|
|
63.5 |
|
|
Total operating expenses |
|
354.0 |
|
|
|
395.5 |
|
|
|
343.7 |
|
|
|
1,077.9 |
|
|
|
1,015.0 |
|
|
Operating income |
|
445.4 |
|
|
|
388.5 |
|
|
|
687.0 |
|
|
|
1,359.1 |
|
|
|
1,926.6 |
|
|
Other income (expense), net: |
|
|
|
|
|
|
|
|
|
|||||||||||
Interest expense |
|
(15.7 |
) |
|
|
(15.7 |
) |
|
|
(16.2 |
) |
|
|
(47.0 |
) |
|
|
(59.0 |
) |
|
Interest income |
|
28.6 |
|
|
|
27.4 |
|
|
|
25.7 |
|
|
|
83.6 |
|
|
|
66.8 |
|
|
Loss on debt prepayment |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(13.3 |
) |
|
Loss on divestiture of business |
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
(0.7 |
) |
|
Other income (expense) |
|
(3.7 |
) |
|
|
1.9 |
|
|
|
1.1 |
|
|
|
(0.8 |
) |
|
|
4.5 |
|
|
Other income (expense), net |
|
9.2 |
|
|
|
13.6 |
|
|
|
10.5 |
|
|
|
35.8 |
|
|
|
(1.7 |
) |
|
Income before income taxes |
|
454.6 |
|
|
|
402.1 |
|
|
|
697.5 |
|
|
|
1,394.9 |
|
|
|
1,924.9 |
|
|
Income tax provision |
|
(51.9 |
) |
|
|
(63.7 |
) |
|
|
(114.6 |
) |
|
|
(200.1 |
) |
|
|
(302.7 |
) |
|
Net income |
|
402.7 |
|
|
|
338.4 |
|
|
|
582.9 |
|
|
|
1,194.8 |
|
|
|
1,622.2 |
|
|
Less: Net income attributable to non-controlling interest |
|
(1.0 |
) |
|
|
(0.2 |
) |
|
|
(0.2 |
) |
|
|
(1.9 |
) |
|
|
(1.2 |
) |
|
Net income attributable to ON Semiconductor Corporation |
$ |
401.7 |
|
|
$ |
338.2 |
|
|
$ |
582.7 |
|
|
$ |
1,192.9 |
|
|
$ |
1,621.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income for diluted earnings per share of common stock |
$ |
401.7 |
|
|
$ |
338.2 |
|
|
$ |
583.1 |
|
|
$ |
1,192.9 |
|
|
$ |
1,622.2 |
|
|
Net income per share of common stock: |
|
|
|
|
|
|
|
|
|
|||||||||||
Basic |
$ |
0.94 |
|
|
$ |
0.79 |
|
|
$ |
1.35 |
|
|
$ |
2.79 |
|
|
$ |
3.76 |
|
|
Diluted |
$ |
0.93 |
|
|
$ |
0.78 |
|
|
$ |
1.29 |
|
|
$ |
2.75 |
|
|
$ |
3.61 |
|
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|||||||||||
Basic |
|
427.0 |
|
|
|
429.1 |
|
|
|
431.2 |
|
|
|
428.1 |
|
|
|
431.6 |
|
|
Diluted |
|
431.7 |
|
|
|
433.2 |
|
|
|
450.7 |
|
|
|
433.8 |
|
|
|
449.3 |
|
|
ON SEMICONDUCTOR CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEETS
(in millions)
|
September 27,
|
|
June 28, 2024 |
|
December 31,
|
|||||||
Assets |
|
|
|
|
|
|||||||
Cash and cash equivalents |
$ |
2,470.2 |
|
|
$ |
2,231.0 |
|
|
$ |
2,483.0 |
|
|
Short-term investments |
|
300.0 |
|
|
|
450.0 |
|
|
|
— |
|
|
Receivables, net |
|
1,070.6 |
|
|
|
887.2 |
|
|
|
935.4 |
|
|
Inventories |
|
2,242.8 |
|
|
|
2,224.6 |
|
|
|
2,111.8 |
|
|
Other current assets |
|
461.1 |
|
|
|
532.2 |
|
|
|
382.1 |
|
|
Total current assets |
|
6,544.7 |
|
|
|
6,325.0 |
|
|
|
5,912.3 |
|
|
Property, plant and equipment, net |
|
4,383.7 |
|
|
|
4,372.5 |
|
|
|
4,401.5 |
|
|
Goodwill |
|
1,587.9 |
|
|
|
1,577.6 |
|
|
|
1,577.6 |
|
|
Intangible assets, net |
|
273.1 |
|
|
|
275.0 |
|
|
|
299.3 |
|
|
Deferred tax assets |
|
725.8 |
|
|
|
679.1 |
|
|
|
600.8 |
|
|
ROU financing lease assets |
|
41.1 |
|
|
|
41.7 |
|
|
|
42.4 |
|
|
Other assets |
|
367.3 |
|
|
|
387.9 |
|
|
|
381.3 |
|
|
Total assets |
$ |
13,923.6 |
|
|
$ |
13,658.8 |
|
|
$ |
13,215.2 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|||||||
Accounts payable |
$ |
597.5 |
|
|
$ |
617.7 |
|
|
$ |
725.6 |
|
|
Accrued expenses and other current liabilities |
|
734.3 |
|
|
|
684.3 |
|
|
|
663.2 |
|
|
Current portion of financing lease liabilities |
|
0.4 |
|
|
|
0.4 |
|
|
|
0.8 |
|
|
Current portion of long-term debt |
|
796.4 |
|
|
|
795.6 |
|
|
|
794.0 |
|
|
Total current liabilities |
|
2,128.6 |
|
|
|
2,098.0 |
|
|
|
2,183.6 |
|
|
Long-term debt |
|
2,547.2 |
|
|
|
2,545.7 |
|
|
|
2,542.6 |
|
|
Deferred tax liabilities |
|
42.8 |
|
|
|
39.6 |
|
|
|
38.7 |
|
|
Long-term financing lease liabilities |
|
22.4 |
|
|
|
21.7 |
|
|
|
22.4 |
|
|
Other long-term liabilities |
|
578.6 |
|
|
|
595.4 |
|
|
|
627.3 |
|
|
Total liabilities |
|
5,319.6 |
|
|
|
5,300.4 |
|
|
|
5,414.6 |
|
|
ON Semiconductor Corporation stockholders’ equity: |
|
|
|
|
|
|||||||
Common stock |
|
6.2 |
|
|
|
6.2 |
|
|
|
6.2 |
|
|
Additional paid-in capital |
|
5,321.9 |
|
|
|
5,283.3 |
|
|
|
5,210.9 |
|
|
Accumulated other comprehensive loss |
|
(49.1 |
) |
|
|
(56.8 |
) |
|
|
(45.2 |
) |
|
Accumulated earnings |
|
7,741.0 |
|
|
|
7,339.3 |
|
|
|
6,548.1 |
|
|
Less: Treasury stock, at cost |
|
(4,435.9 |
) |
|
|
(4,232.5 |
) |
|
|
(3,937.4 |
) |
|
Total ON Semiconductor Corporation stockholders’ equity |
|
8,584.1 |
|
|
|
8,339.5 |
|
|
|
7,782.6 |
|
|
Non-controlling interest |
|
19.9 |
|
|
|
18.9 |
|
|
|
18.0 |
|
|
Total stockholders’ equity |
|
8,604.0 |
|
|
|
8,358.4 |
|
|
|
7,800.6 |
|
|
Total liabilities and stockholders’ equity |
$ |
13,923.6 |
|
|
$ |
13,658.8 |
|
|
$ |
13,215.2 |
|
|
ON SEMICONDUCTOR CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
|
Quarters Ended |
|
Nine Months Ended |
|||||||||||||||||
|
September 27,
|
|
June 28, 2024 |
|
September 29,
|
|
September 27,
|
|
September 29,
|
|||||||||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
|||||||||||
Net income |
$ |
402.7 |
|
|
$ |
338.4 |
|
|
$ |
582.9 |
|
|
$ |
1,194.8 |
|
|
$ |
1,622.2 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
|||||||||||
Depreciation and amortization |
|
161.8 |
|
|
|
159.6 |
|
|
|
155.4 |
|
|
|
476.3 |
|
|
|
449.2 |
|
|
Loss on sale and disposal of fixed assets |
|
4.1 |
|
|
|
0.9 |
|
|
|
2.5 |
|
|
|
5.1 |
|
|
|
7.3 |
|
|
Loss on divestiture of businesses |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.7 |
|
|
Loss on debt prepayment |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
13.3 |
|
|
Amortization of debt discount and issuance costs |
|
3.6 |
|
|
|
2.9 |
|
|
|
2.9 |
|
|
|
9.2 |
|
|
|
8.7 |
|
|
Share-based compensation |
|
32.7 |
|
|
|
32.3 |
|
|
|
31.1 |
|
|
|
98.0 |
|
|
|
90.4 |
|
|
Non-cash asset impairment charges |
|
— |
|
|
|
15.7 |
|
|
|
— |
|
|
|
15.7 |
|
|
|
12.7 |
|
|
Change in deferred tax balances |
|
(45.6 |
) |
|
|
(27.9 |
) |
|
|
(79.4 |
) |
|
|
(122.1 |
) |
|
|
(109.0 |
) |
|
Other |
|
1.7 |
|
|
|
3.5 |
|
|
|
10.8 |
|
|
|
7.0 |
|
|
|
1.5 |
|
|
Changes in assets and liabilities |
|
(95.2 |
) |
|
|
(163.2 |
) |
|
|
(139.7 |
) |
|
|
(357.3 |
) |
|
|
(730.7 |
) |
|
Net cash provided by operating activities |
|
465.8 |
|
|
|
362.2 |
|
|
|
566.6 |
|
|
|
1,326.7 |
|
|
|
1,366.3 |
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
|||||||||||
Purchase of Property, Plant and Equipment (“PP&E”) |
|
(172.2 |
) |
|
|
(154.5 |
) |
|
|
(433.0 |
) |
|
|
(549.1 |
) |
|
|
(1,185.1 |
) |
|
Deposits and proceeds from sale of PP&E |
|
0.3 |
|
|
|
0.2 |
|
|
|
0.2 |
|
|
|
0.6 |
|
|
|
2.8 |
|
|
Deposits utilized for purchase of PP&E |
|
10.5 |
|
|
|
13.4 |
|
|
|
12.9 |
|
|
|
12.4 |
|
|
|
32.4 |
|
|
Purchase of short-term investments |
|
(300.0 |
) |
|
|
(450.0 |
) |
|
|
— |
|
|
|
(750.0 |
) |
|
|
— |
|
|
Proceeds from sale or maturity of short-term investments and available-for-sale securities |
|
450.0 |
|
|
|
— |
|
|
|
12.7 |
|
|
|
450.0 |
|
|
|
33.5 |
|
|
Purchase of a business, net of cash acquired |
|
(20.5 |
) |
|
|
— |
|
|
|
— |
|
|
|
(20.5 |
) |
|
|
— |
|
|
Payments related to acquisition of business |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(236.3 |
) |
|
Other |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1.5 |
) |
|
|
— |
|
|
Net cash used in investing activities |
|
(31.9 |
) |
|
|
(590.9 |
) |
|
|
(407.2 |
) |
|
|
(858.1 |
) |
|
|
(1,352.7 |
) |
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
|||||||||||
Proceeds for the issuance of common stock under the ESPP |
|
6.5 |
|
|
|
5.5 |
|
|
|
6.7 |
|
|
|
19.6 |
|
|
|
19.9 |
|
|
Payment of tax withholding for RSUs |
|
(3.1 |
) |
|
|
(7.7 |
) |
|
|
(5.9 |
) |
|
|
(48.3 |
) |
|
|
(62.4 |
) |
|
Repurchase of common stock |
|
(200.0 |
) |
|
|
(150.0 |
) |
|
|
(100.0 |
) |
|
|
(450.0 |
) |
|
|
(264.0 |
) |
|
Issuance and borrowings under debt agreements |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,845.0 |
|
|
Reimbursement of debt issuance costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4.5 |
|
|
Payment of debt issuance and other financing costs |
|
— |
|
|
|
— |
|
|
|
(0.3 |
) |
|
|
— |
|
|
|
(11.7 |
) |
|
Repayment of borrowings under debt agreements |
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
(1,603.8 |
) |
|
Payment for purchase of bond hedges |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(414.0 |
) |
|
Proceeds from issuance of warrants |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
242.5 |
|
|
Payment of finance lease obligations |
|
(0.4 |
) |
|
|
(0.5 |
) |
|
|
(1.7 |
) |
|
|
(1.8 |
) |
|
|
(10.3 |
) |
|
Net cash used in financing activities |
|
(197.0 |
) |
|
|
(152.7 |
) |
|
|
(101.3 |
) |
|
|
(480.5 |
) |
|
|
(254.3 |
) |
|
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
2.4 |
|
|
|
(2.2 |
) |
|
|
(0.5 |
) |
|
|
(0.7 |
) |
|
|
(1.5 |
) |
|
Net increase (decrease) in cash, cash equivalents and restricted cash |
|
239.3 |
|
|
|
(383.6 |
) |
|
|
57.6 |
|
|
|
(12.6 |
) |
|
|
(242.2 |
) |
|
Beginning cash, cash equivalents and restricted cash |
|
2,233.1 |
|
|
|
2,616.7 |
|
|
|
2,633.2 |
|
|
|
2,485.0 |
|
|
|
2,933.0 |
|
|
Ending cash, cash equivalents and restricted cash |
$ |
2,472.4 |
|
|
$ |
2,233.1 |
|
|
$ |
2,690.8 |
|
|
$ |
2,472.4 |
|
|
$ |
2,690.8 |
|
|
ON SEMICONDUCTOR CORPORATION
RECONCILIATION OF GAAP VERSUS NON-GAAP DISCLOSURES (Continued)
(in millions, except per share and percentage data)
|
|
|
Quarters Ended |
|
Nine Months Ended |
|||||||||||||||||
|
|
|
September 27,
|
|
June 28, 2024 |
|
September 29,
|
|
September 27,
|
|
September 29,
|
|||||||||||
Reconciliation of GAAP to non-GAAP gross profit: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP gross profit |
$ |
799.4 |
|
|
$ |
784.0 |
|
|
$ |
1,030.7 |
|
|
$ |
2,437.0 |
|
|
$ |
2,941.6 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.9 |
) |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
1.6 |
|
|
|
1.6 |
|
|
|
1.4 |
|
|
|
4.7 |
|
|
|
4.2 |
|
|
|
|
Total special items |
|
1.6 |
|
|
|
1.6 |
|
|
|
1.4 |
|
|
|
4.7 |
|
|
|
0.3 |
|
|
Non-GAAP gross profit |
$ |
801.0 |
|
|
$ |
785.6 |
|
|
$ |
1,032.1 |
|
|
$ |
2,441.7 |
|
|
$ |
2,941.9 |
|
|||
Reconciliation of GAAP to non-GAAP gross margin: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP gross margin |
|
45.4 |
% |
|
|
45.2 |
% |
|
|
47.3 |
% |
|
|
45.5 |
% |
|
|
47.2 |
% |
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
|
(0.1 |
)% |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
|
Total special items |
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
— |
% |
|
Non-GAAP gross margin |
|
45.5 |
% |
|
|
45.3 |
% |
|
|
47.3 |
% |
|
|
45.6 |
% |
|
|
47.2 |
% |
|||
Reconciliation of GAAP to non-GAAP operating expenses: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP operating expenses |
$ |
354.0 |
|
|
$ |
395.5 |
|
|
$ |
343.7 |
|
|
$ |
1,077.9 |
|
|
$ |
1,015.0 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Amortization of acquisition-related intangible assets |
|
(13.0 |
) |
|
|
(12.9 |
) |
|
|
(12.0 |
) |
|
|
(38.5 |
) |
|
|
(39.0 |
) |
|
|
b) |
Restructuring, asset impairments and other, net |
|
(29.1 |
) |
|
|
(72.5 |
) |
|
|
(9.4 |
) |
|
|
(103.0 |
) |
|
|
(63.5 |
) |
|
|
c) |
Third party acquisition and divestiture-related costs |
|
(7.4 |
) |
|
|
(1.7 |
) |
|
|
(0.1 |
) |
|
|
(9.2 |
) |
|
|
1.2 |
|
|
|
|
Total special items |
|
(49.5 |
) |
|
|
(87.1 |
) |
|
|
(21.5 |
) |
|
|
(150.7 |
) |
|
|
(101.3 |
) |
|
Non-GAAP operating expenses |
$ |
304.5 |
|
|
$ |
308.4 |
|
|
$ |
322.2 |
|
|
$ |
927.2 |
|
|
$ |
913.7 |
|
|||
Reconciliation of GAAP to non-GAAP operating income: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP operating income |
$ |
445.4 |
|
|
$ |
388.5 |
|
|
$ |
687.0 |
|
|
$ |
1,359.1 |
|
|
$ |
1,926.6 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.9 |
) |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
14.6 |
|
|
|
14.5 |
|
|
|
13.4 |
|
|
|
43.2 |
|
|
|
43.2 |
|
|
|
c) |
Restructuring, asset impairments and other, net |
|
29.1 |
|
|
|
72.5 |
|
|
|
9.4 |
|
|
|
103.0 |
|
|
|
63.5 |
|
|
|
d) |
Third party acquisition and divestiture-related costs |
|
7.4 |
|
|
|
1.7 |
|
|
|
0.1 |
|
|
|
9.2 |
|
|
|
(1.2 |
) |
|
|
|
Total special items |
|
51.1 |
|
|
|
88.7 |
|
|
|
22.9 |
|
|
|
155.4 |
|
|
|
101.6 |
|
|
Non-GAAP operating income |
$ |
496.5 |
|
|
$ |
477.2 |
|
|
$ |
709.9 |
|
|
$ |
1,514.5 |
|
|
$ |
2,028.2 |
|
|||
Reconciliation of GAAP to non-GAAP operating margin (operating income / revenue): |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP operating margin |
|
25.3 |
% |
|
|
22.4 |
% |
|
|
31.5 |
% |
|
|
25.4 |
% |
|
|
30.9 |
% |
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
|
(0.1 |
)% |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
0.8 |
% |
|
|
0.8 |
% |
|
|
0.6 |
% |
|
|
0.8 |
% |
|
|
0.7 |
% |
|
|
c) |
Restructuring, asset impairments and other, net |
|
1.7 |
% |
|
|
4.2 |
% |
|
|
0.4 |
% |
|
|
1.9 |
% |
|
|
1.0 |
% |
|
|
d) |
Third party acquisition and divestiture-related costs |
|
0.4 |
% |
|
|
0.1 |
% |
|
|
— |
% |
|
|
0.2 |
% |
|
|
— |
% |
|
|
|
Total special items |
|
2.9 |
% |
|
|
5.1 |
% |
|
|
1.1 |
% |
|
|
2.9 |
% |
|
|
1.6 |
% |
|
Non-GAAP operating margin |
|
28.2 |
% |
|
|
27.5 |
% |
|
|
32.6 |
% |
|
|
28.3 |
% |
|
|
32.5 |
% |
|||
Reconciliation of GAAP to non-GAAP income before income taxes: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP income before income taxes |
$ |
454.6 |
|
|
$ |
402.1 |
|
|
$ |
697.5 |
|
|
$ |
1,394.9 |
|
|
$ |
1,924.9 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.9 |
) |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
14.6 |
|
|
|
14.5 |
|
|
|
13.4 |
|
|
|
43.2 |
|
|
|
43.2 |
|
|
|
c) |
Restructuring, asset impairments and other, net |
|
29.1 |
|
|
|
72.5 |
|
|
|
9.4 |
|
|
|
103.0 |
|
|
|
63.5 |
|
|
|
d) |
Third party acquisition and divestiture-related costs |
|
7.4 |
|
|
|
1.7 |
|
|
|
0.1 |
|
|
|
9.2 |
|
|
|
(1.2 |
) |
|
|
e) |
Loss on debt prepayment |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
13.3 |
|
|
|
f) |
Loss on divestiture of business |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.7 |
|
|
|
|
Total special items |
|
51.1 |
|
|
|
88.7 |
|
|
|
23.0 |
|
|
|
155.4 |
|
|
|
115.6 |
|
|
Non-GAAP income before income taxes |
$ |
505.7 |
|
|
$ |
490.8 |
|
|
$ |
720.5 |
|
|
$ |
1,550.3 |
|
|
$ |
2,040.5 |
|
|||
Reconciliation of GAAP to non-GAAP net income attributable to ON Semiconductor Corporation: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP net income attributable to ON Semiconductor Corporation |
$ |
401.7 |
|
|
$ |
338.2 |
|
|
$ |
582.7 |
|
|
$ |
1,192.9 |
|
|
$ |
1,621.0 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Impact of business wind down |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.9 |
) |
|
|
b) |
Amortization of acquisition-related intangible assets |
|
14.6 |
|
|
|
14.5 |
|
|
|
13.4 |
|
|
|
43.2 |
|
|
|
43.2 |
|
|
|
c) |
Restructuring, asset impairments and other, net |
|
29.1 |
|
|
|
72.5 |
|
|
|
9.4 |
|
|
|
103.0 |
|
|
|
63.5 |
|
|
|
d) |
Third party acquisition and divestiture-related costs |
|
7.4 |
|
|
|
1.7 |
|
|
|
0.1 |
|
|
|
9.2 |
|
|
|
(1.2 |
) |
|
|
e) |
Loss on debt prepayment |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
13.3 |
|
|
|
f) |
Loss on divestiture of a business |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.7 |
|
|
|
g) |
Income taxes |
|
(29.0 |
) |
|
|
(14.8 |
) |
|
|
2.7 |
|
|
|
(47.9 |
) |
|
|
(21.2 |
) |
|
|
|
Total special items |
|
22.1 |
|
|
|
73.9 |
|
|
|
25.7 |
|
|
|
107.5 |
|
|
|
94.4 |
|
|
Non-GAAP net income attributable to ON Semiconductor Corporation |
$ |
423.8 |
|
|
$ |
412.1 |
|
|
$ |
608.4 |
|
|
$ |
1,300.4 |
|
|
$ |
1,715.4 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
GAAP net income for diluted earnings per share |
$ |
401.7 |
|
|
$ |
338.2 |
|
|
$ |
583.1 |
|
|
$ |
1,192.9 |
|
|
$ |
1,622.2 |
|
|||
Non-GAAP net income for diluted earnings per share |
$ |
423.8 |
|
|
$ |
412.1 |
|
|
$ |
608.8 |
|
|
$ |
1,300.4 |
|
|
$ |
1,716.6 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Reconciliation of GAAP to non-GAAP diluted shares outstanding: |
|
|
|
|
|
|
|
|
|
|||||||||||||
GAAP diluted shares outstanding |
|
431.7 |
|
|
|
433.2 |
|
|
|
450.7 |
|
|
|
433.8 |
|
|
|
449.3 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Less: dilutive shares attributable to convertible notes |
|
(4.1 |
) |
|
|
(3.7 |
) |
|
|
(11.4 |
) |
|
|
(4.2 |
) |
|
|
(10.2 |
) |
|
|
|
Total special items |
|
(4.1 |
) |
|
|
(3.7 |
) |
|
|
(11.4 |
) |
|
|
(4.2 |
) |
|
|
(10.2 |
) |
|
Non-GAAP diluted shares outstanding |
|
427.6 |
|
|
|
429.5 |
|
|
|
439.3 |
|
|
|
429.6 |
|
|
|
439.1 |
|
|||
Non-GAAP diluted earnings per share: |
|
|
|
|
|
|
|
|
|
|||||||||||||
Non-GAAP net income for diluted earnings per share |
$ |
423.8 |
|
|
$ |
412.1 |
|
|
$ |
608.8 |
|
|
$ |
1,300.4 |
|
|
$ |
1,716.6 |
|
|||
Non-GAAP diluted shares outstanding |
|
427.6 |
|
|
|
429.5 |
|
|
|
439.3 |
|
|
|
429.6 |
|
|
|
439.1 |
|
|||
Non-GAAP diluted earnings per share |
$ |
0.99 |
|
|
$ |
0.96 |
|
|
$ |
1.39 |
|
|
$ |
3.03 |
|
|
$ |
3.91 |
|
|||
Reconciliation of net cash provided by operating activities to free cash flow: |
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash provided by operating activities |
$ |
465.8 |
|
|
$ |
362.2 |
|
|
$ |
566.6 |
|
|
$ |
1,326.7 |
|
|
$ |
1,366.3 |
|
|||
|
Special items: |
|
|
|
|
|
|
|
|
|
||||||||||||
|
a) |
Purchase of property, plant and equipment |
|
(172.2 |
) |
|
|
(154.5 |
) |
|
|
(433.0 |
) |
|
|
(549.1 |
) |
|
|
(1,185.1 |
) |
|
|
|
Total special items |
|
(172.2 |
) |
|
|
(154.5 |
) |
|
|
(433.0 |
) |
|
|
(549.1 |
) |
|
|
(1,185.1 |
) |
|
Free cash flow |
$ |
293.6 |
|
|
$ |
207.7 |
|
|
$ |
133.6 |
|
|
$ |
777.6 |
|
|
$ |
181.2 |
|
|||
Certain of the amounts in the above tables may not total due to rounding of individual amounts.
|
Quarters Ended |
|
||||||||||||||||||
|
December 31,
|
March 29,
|
June 28, 2024 |
September 27,
|
Last Twelve
|
|||||||||||||||
Net cash provided by operating activities |
$ |
611.2 |
|
$ |
498.7 |
|
$ |
362.2 |
|
$ |
465.8 |
|
$ |
1,937.9 |
|
|||||
Purchase of property, plant and equipment |
|
(390.5 |
) |
|
(222.4 |
) |
|
(154.5 |
) |
|
(172.2 |
) |
|
(939.6 |
) |
|||||
Free cash flow |
$ |
220.7 |
|
$ |
276.3 |
|
$ |
207.7 |
|
$ |
293.6 |
|
$ |
998.3 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Revenue |
$ |
2,018.1 |
|
$ |
1,862.7 |
|
$ |
1,735.2 |
|
$ |
1,761.9 |
|
$ |
7,377.9 |
|
|||||
ON SEMICONDUCTOR CORPORATION
RECONCILIATION OF GAAP VERSUS NON-GAAP DISCLOSURES (Continued)
(in millions, except per share and percentage data)
SHARE-BASED COMPENSATION
Total share-based compensation related to restricted stock units, stock grant awards and the employee stock purchase plan was as follows:
|
Quarters Ended |
Nine Months Ended |
|||||||||||||
|
September 27,
|
June 28, 2024 |
September 29,
|
September 27,
|
September 29,
|
||||||||||
Cost of revenue |
$ |
6.2 |
$ |
6.5 |
$ |
4.8 |
$ |
18.1 |
$ |
13.4 |
|||||
Research and development |
|
6.1 |
|
6.4 |
|
5.3 |
|
18.2 |
|
15.0 |
|||||
Selling and marketing |
|
4.8 |
|
5.4 |
|
4.7 |
|
15.4 |
|
13.8 |
|||||
General and administrative |
|
15.6 |
|
14.0 |
|
16.3 |
|
46.3 |
|
48.2 |
|||||
Total share-based compensation |
$ |
32.7 |
$ |
32.3 |
$ |
31.1 |
$ |
98.0 |
$ |
90.4 |
|||||
SUPPLEMENTAL FINANCIAL DATA
|
Quarters Ended |
Nine Months Ended |
|||||||||||||
|
September 27,
|
June 28, 2024 |
September 29,
|
September 27,
|
September 29,
|
||||||||||
Net cash provided by operating activities |
$ |
465.8 |
$ |
362.2 |
$ |
566.6 |
$ |
1,326.7 |
$ |
1,366.3 |
|||||
Free cash flow |
$ |
293.6 |
$ |
207.7 |
$ |
133.6 |
$ |
777.6 |
$ |
181.2 |
|||||
Cash paid for income taxes |
$ |
49.2 |
$ |
221.3 |
$ |
99.8 |
$ |
294.1 |
$ |
327.4 |
|||||
|
|
|
|
|
|
||||||||||
Depreciation and amortization |
$ |
161.8 |
$ |
159.6 |
$ |
155.4 |
$ |
476.3 |
$ |
449.2 |
|||||
Less: Amortization of acquisition-related intangible assets |
|
14.6 |
|
14.5 |
|
13.4 |
|
43.2 |
|
43.2 |
|||||
Depreciation and amortization (excl. amortization of acquisition-related intangible assets) |
$ |
147.2 |
$ |
145.1 |
$ |
142.0 |
$ |
433.1 |
$ |
406.0 |
|||||
NON-GAAP MEASURES
To supplement the consolidated financial results prepared in accordance with GAAP, onsemi uses certain non-GAAP measures, which are adjusted from the most directly comparable GAAP measures to exclude items related to the amortization of acquisition-related intangibles, expensing of appraised inventory fair market value step-up, inventory valuation adjustments, in-process research and development expenses, restructuring, asset impairments and other, net, goodwill impairment charges, gains and losses on debt prepayment, non-cash interest expense, actuarial (gains) losses on pension plans and other pension benefits, third party acquisition and divestiture-related costs, tax impact of these items and certain other non-recurring items, as necessary. Management does not consider the effects of these items in evaluating the core operational activities of onsemi. Management uses these non-GAAP measures internally to make strategic decisions, forecast future results and evaluate onsemi’s current performance. In addition, the Company believes that most analysts covering onsemi use the non-GAAP measures to evaluate onsemi’s performance. Given management’s and other relevant parties’ use of these non-GAAP measures, onsemi believes these measures are important to investors in understanding onsemi’s current and future operating results as seen through the eyes of management. In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in onsemi’s core business across different time periods. These non-GAAP measures are not prepared in accordance with, and should not be considered alternatives or necessarily superior to, GAAP financial data and may be different from non-GAAP measures used by other companies. 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.
Non-GAAP Revenue
The use of non-GAAP revenue allows management to evaluate, among other things, the revenue from the Company’s core businesses and trends across different reporting periods on a consistent basis, independent of special items. In addition, non- GAAP revenue is an important component of management’s internal performance measurement and incentive and reward process as it is used to assess the current and historical financial results of the business and for strategic decision making, preparing budgets, obtaining targets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to evaluate the Company’s revenue generation performance relative to the direct costs of operations of onsemi’s core businesses.
Non-GAAP Gross Profit and Gross Margin
The use of non-GAAP gross profit and gross margin allows management to evaluate, among other things, the gross profit and gross margin of the Company’s core businesses and trends across different reporting periods on a consistent basis, independent of non-cash items including, generally speaking, expensing of appraised inventory fair market value step-up, impact of business wind down and non-recurring facility costs. In addition, it is an important component of management’s internal performance measurement and incentive and reward process as it is used to assess the current and historical financial results of the business and for strategic decision making, preparing budgets, obtaining targets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to evaluate our operating performance independent of certain non-cash items and the effects of certain variables unrelated to our overall operating performance.
Non-GAAP Operating Income and Operating Margin
The use of non-GAAP operating income and operating margin allows management to evaluate, among other things, the operating income and operating margin of the Company’s core businesses and trends across different reporting periods on a consistent basis, independent of non-cash items including, generally speaking, expensing of appraised inventory fair market value step-up, impact of business wind down, non-recurring facility costs, amortization and impairments of intangible assets, third party acquisition and divestiture-related costs, restructuring charges and certain other special items as necessary. In addition, it is an important component of management’s internal performance measurement and incentive and reward process as it is used to assess the current and historical financial results of the business and for strategic decision making, preparing budgets, obtaining targets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to evaluate our operating performance independent of certain non-cash items and the effects of certain variables unrelated to our overall operating performance.
Non-GAAP Net Income Attributable to ON Semiconductor Corporation and Non-GAAP Diluted Earnings Per Share
The use of non-GAAP net income attributable to onsemi and non-GAAP diluted earnings per share allows management to evaluate the operating results of onsemi’s core businesses and trends across different reporting periods on a consistent basis, independent of non-cash items including, generally, the amortization and impairments of intangible assets, expensing of appraised inventory fair market value step-up, impact of business wind down, non-recurring facility costs, restructuring, gains and losses on debt prepayment, actuarial (gains) losses on pension plans and other pension benefits, third party acquisition and divestiture-related costs, discrete tax items and other non-GAAP tax adjustments and certain other special items, as necessary. In addition, these measures are important components of management’s internal performance measurement and incentive and reward process, as they are used to assess the current and historical financial results of the business and for strategic decision making, preparing budgets, setting targets and forecasting future results. For our non-GAAP reporting, we are utilizing a projected and normalized non-GAAP effective tax rate of
Free Cash Flow
The use of free cash flow allows management to evaluate, among other things, the ability of the Company to make interest or principal payments on its debt. Free cash flow is defined as the difference between cash flow from operating activities and capital expenditures disclosed under investing activities in the consolidated statement of cash flows. Free cash flow is not an alternative to cash flow from operating activities as a measure of liquidity. It is an important component of management’s internal performance measurement and incentive and reward process as it is used to assess the current and historical financial results of the business and for strategic decision making, preparing budgets, obtaining targets and forecasting future results. Management presents this non-GAAP financial measure to enable investors and analysts to evaluate our financial performance independent of the cash capital expenditures.
Non-GAAP Diluted Share Count
The use of non-GAAP diluted share count allows management to evaluate, among other things, the potential dilution due to the outstanding restricted stock units excluding the dilution from the convertible notes that is covered by hedging activity up to a certain threshold. In periods when the quarterly average stock price per share exceeds
View source version on businesswire.com: https://www.businesswire.com/news/home/20241028311387/en/
Krystal Heaton
Director, Head of Public Relations
onsemi
(480) 242-6943
Krystal.Heaton@onsemi.com
Parag Agarwal
Vice President - Investor Relations & Corporate Development
onsemi
(602) 244-3437
investor@onsemi.com
Source: onsemi
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