ON Semiconductor Corporation Revenue in 2025

ON Semiconductor Corporation reported $7.1B in revenue for fiscal year 2025. This represents a growth of 0% compared to the 2024 figure of $7.1B.

In fiscal year 2024, a semiconductor company that most consumers have never heard of generated $1.21 billion in free cash flow — a 3x increase from the $438.4 million it produced in 2023 — despite revenue declining 14.2% to $7.08 billion. That company, ON Semiconductor Corporation, achieved this cash flow surge not by cutting research and development but by executing a "Fab Right" manufacturing strategy that reduced capital expenditures from $1.54 billion in 2022 to $694 million in 2024 while maintaining a 45.4% gross margin that would have been unimaginable during the company's prior downturns, when margins compressed to approximately 30%. El-Khoury, who immigrated to the United States from Lebanon at age 17 and rose from application engineer at Cypress Semiconductor to CEO of that company before its $9.3 billion acquisition by Infineon in 2020, has restructured ON Semiconductor around two secular megatrends: the electrification of vehicles and the power efficiency demands of AI data centers. They require the company to maintain its 35-40% estimated market share in SiC power devices, successfully ramp its $2 billion Czech Republic SiC manufacturing expansion, and fend off competition from Infineon, STMicroelectronics, and Wolfspeed in a market where design wins are locked in years before vehicles reach production. Revenue fell across all three segments: Power Solutions Group declined 13.7% to $3.35 billion, Analog and Mixed-Signal Group fell 14.7% to $2.61 billion, and Intelligent Sensing Group dropped 14.5% to $1.13 billion. Net income fell 28% to $1.57 billion. Yet the company maintained pricing discipline, reduced inventory from $2.11 billion to normalized levels, and returned 54% of its free cash flow to shareholders through $650 million in share repurchases. With $2.69 billion in cash, $3.35 billion in long-term debt, and total shareholders' equity of $8.81 billion, ON Semiconductor's balance sheet supports both its growth investments and its capital return program. ON Semiconductor Corporation is a $7.08 billion revenue semiconductor company headquartered in Scottsdale, Arizona, that designs intelligent power and sensing solutions for automotive, industrial, cloud power, and IoT markets. The company operates three segments: Power Solutions Group (47% of revenue, $3.35B in FY2024), Analog and Mixed-Signal Group (37%, $2.61B), and Intelligent Sensing Group (16%, $1.13B). Despite a 14.2% revenue decline in FY2024 due to cyclical weakness in automotive and industrial markets, the company generated $1.21 billion in free cash flow — a 3x year-over-year increase — while maintaining a 45.4% gross margin. ON Semiconductor supplies EliteSiC devices to Volkswagen, BMW, Hyundai-Kia, Zeekr, and Stellantis, and is investing up to $2 billion in a Czech Republic SiC manufacturing facility. In fiscal year 2024, the company's $7.08 billion in revenue broke down as follows: Power Solutions Group (PSG) contributed $3.35 billion (47.3% of total revenue), Analog and Mixed-Signal Group (AMG) contributed $2.61 billion (36.8%), and Intelligent Sensing Group (ISG) contributed $1.13 billion (15.9%). This segment generated $3.35 billion in FY2024 revenue, down 13.7% from $3.88 billion in FY2023, with gross profit of $1.38 billion at a 41.3% gross margin. The revenue decline was driven by weakness across all three PSG divisions: Multi-Market Power fell $250.8 million, Industrial Power fell $162.2 million, and Automotive Power fell $119.1 million, all primarily due to decreased demand in automotive and industrial end markets. The segment's profitability is highly sensitive to manufacturing use — when demand weakens, fixed costs at the company's internal fabrication facilities create margin pressure, which is why the 170 basis point gross margin compression across the company in 2024 was concentrated in underutilized manufacturing assets. The Analog and Mixed-Signal Group contributed $2.61 billion in FY2024 revenue, down 14.7% from $3.06 billion in FY2023, with gross profit of $1.31 billion at a 50.1% gross margin — the highest of the three segments. The revenue decline was driven by weakness in the Power Management Division (down $269.1 million), Sensor Interface Division (down $101.5 million), and Integrated Circuit Division (down $77.4 million), again due to soft automotive and industrial demand. The Intelligent Sensing Group contributed $1.13 billion in FY2024 revenue, down 14.5% from $1.32 billion in FY2023, with gross profit of $525.4 million at a 46.7% gross margin. The revenue decline was driven by the Industrial and Consumer Solutions Division (down $107.8 million) and the Automotive Sensing Division (down $82.7 million). In FY2024, distributors accounted for $3.76 billion (53.1%) of revenue and direct customers accounted for $3.32 billion (46.9%). PSG's 41.3% gross margin in FY2024 reflects the capital intensity of power semiconductor manufacturing and the competitive pricing in discrete and MOSFET products, offset by premium pricing on SiC devices. The company's overall GAAP gross margin was 45.4% for FY2024, down 170 basis points from 47.1% in FY2023, primarily due to lower sales volumes and manufacturing underutilization. Non-GAAP gross margin was 45.5%, reflecting minimal impact from acquisition-related amortization. Operating expenses were $1.45 billion for FY2024, up from $1.34 billion in FY2023, driven by $133.9 million in restructuring, asset impairments, and other charges related to the 2024 business realignment that affected approximately 1,600 employees. Excluding these special items, non-GAAP operating expenses were $1.25 billion, representing 17.6% of revenue — well below the 2027 target of 13% as a percentage of revenue. In FY2024, ON Semiconductor generated $1.91 billion in operating cash flow and $1.21 billion in free cash flow, up from $438.4 million in FY2023. Capital expenditures were $694 million, down from $1.54 billion in 2022, as the company completed its major capacity buildout and shifted to a more capital-efficient Fab Right model. The company returned 54% of its free cash flow to shareholders through $650 million in share repurchases at a weighted-average price of $71.21 per share, and it has a $3 billion share repurchase authorization in place. The company has no meaningful debt maturities in the next 12 months, and its $3.35 billion in long-term debt carries a weighted-average interest rate well below 3% thanks to the 0.50% convertible notes due 2029 and 0% notes due 2027. The balance sheet is strong: $2.69 billion in cash, $2.99 billion in cash plus short-term investments, and a current ratio of 5.06. The 2027 financial model targets $3.5-4.0 billion in free cash flow, 25-30% free cash flow margin, and returning 50% of free cash flow to shareholders. This would represent a near-tripling of FY2024 free cash flow and requires revenue to grow at 10-12% annually while gross margins expand 760 basis points to 53% and operating margins expand 1,500 basis points to 40%. The key driver of this expansion is expected to be the mix shift toward higher-margin SiC products, which currently carry EBITDA margins exceeding 40% according to industry analysis, and the operating leverage from revenue growth on a right-sized cost base. ON Semiconductor Corporation generated $7.08 billion in revenue for fiscal year 2024, a 14.2% decline from the prior year, yet produced $1.21 billion in free cash flow — a 3x year-over-year increase — while maintaining a 45.4% gross margin through a cyclical downturn that would have crushed margins in previous cycles. CEO Hassane El-Khoury, who led Cypress Semiconductor through its $9.3 billion sale to Infineon before joining ON Semiconductor in December 2020, has restructured the company around silicon carbide (SiC) power semiconductors that are designed into the next-generation electric drivetrains of Volkswagen, BMW, Hyundai-Kia, Zeekr, and Stellantis. The company's 2027 financial model targets 10-12% revenue CAGR, 53% gross margins, and 40% operating margins — ambitious goals that depend on the cyclical recovery in automotive and industrial demand, the secular ramp of SiC adoption, and the successful execution of the $2 billion Czech Republic manufacturing expansion. With $2.69 billion in cash, $3.35 billion in low-cost long-term debt, and a $3 billion share repurchase authorization, ON Semiconductor's balance sheet supports both growth investment and aggressive capital return. In the automotive semiconductor market — valued at $68.68 billion in 2024 and projected to grow to $133 billion by 2030 at an 11.4% CAGR — ON Semiconductor competes with Infineon Technologies, NXP Semiconductors, STMicroelectronics, Texas Instruments, and Renesas Electronics. Infineon is the clear leader with more than $8 billion in automotive sales in 2024, commanding approximately 13% market share and dominating Si/SiC power modules, drivers, and microcontrollers. Texas Instruments is the dominant player with approximately $17.5 billion in analog revenue and a manufacturing scale that ON Semiconductor cannot match. ON Semiconductor Corporation reported revenue of $7.08 billion for fiscal year 2024, a 14.2% decline from $8.25 billion in FY2023 and a 15.0% decline from the FY2022 peak of $8.33 billion. GAAP net income attributable to ON Semiconductor was $1.57 billion ($3.64 per diluted share), down 28.0% from $2.18 billion ($4.89 per share) in FY2023. Non-GAAP net income was $1.70 billion ($3.98 per share), down 24.5% from $2.26 billion ($5.16 per share) in FY2023. The divergence between GAAP and non-GAAP is modest — $136.1 million in share-based compensation, $52.0 million in acquisition-related intangible amortization, and $133.9 million in restructuring and asset impairment charges — reflecting a company with limited accounting complexity. Gross profit was $3.22 billion, yielding a GAAP gross margin of 45.4% and a non-GAAP gross margin of 45.5%. Operating income was $1.77 billion, yielding an operating margin of 25.0% on a GAAP basis. The company's balance sheet as of December 31, 2024, showed total assets of $14.09 billion, total liabilities of $5.28 billion, and total stockholders' equity of $8.81 billion. Cash and cash equivalents were $2.69 billion, short-term investments were $300 million, and total liquidity was approximately $2.99 billion. Long-term debt was $3.35 billion (net) or $3.38 billion (gross), consisting of a $375 million revolving credit facility due 2028, $1.5 billion in 0.50% convertible notes due 2029, $804.9 million in 0% notes due 2027, and $700 million in 3.875% notes due 2028. Interest expense was $62.3 million for FY2024, down from $74.8 million in FY2023. Operating cash flow was $1.91 billion for FY2024, down modestly from $1.98 billion in FY2023 despite the revenue decline, demonstrating strong working capital management. Capital expenditures were $694 million, down 54.9% from $1.54 billion in FY2022 and down 10.6% from $776 million in FY2023, reflecting the completion of major capacity buildouts and the shift to the Fab Right capital-efficient model. Free cash flow was $1.21 billion, a 176.5% increase from $438.4 million in FY2023 and a 3x increase that management highlighted as a key achievement. The company returned 54% of this free cash flow to shareholders through $650 million in share repurchases, buying approximately 9.1 million shares at a weighted-average price of $71.21. As of December 31, 2024, the company had $1.79 billion remaining under its $3 billion share repurchase authorization. The first quarter 2025 results, reported in May 2025, showed revenue of $1.45 billion, down 22.4% year-over-year, with GAAP gross margin of 20.3% and non-GAAP gross margin of 40.0%. The GAAP operating margin was negative 39.7% due to $431.5 million in non-cash asset impairment charges related to the 2025 Manufacturing Realignment Program, but non-GAAP operating margin was 18.3%. Free cash flow was $454.7 million, up 71.7% year-over-year, representing 31.4% of revenue. The company returned 66% of Q1 free cash flow to shareholders through share repurchases. The 2027 financial model targets revenue of approximately $10-11 billion (implied by 10-12% CAGR from $7.08B), gross margin of 53%, operating margin of 40%, capital expenditures of 11% of revenue, and free cash flow of $3.5-4.0 billion. The company's FY2024 operating income of $1.77 billion was down 30.4% from $2.54 billion in FY2023, and while cost management partially offset the revenue decline, the operating leverage of a semiconductor manufacturing business means that revenue recovery is essential for margin recovery. Infineon Technologies leads the automotive semiconductor market with more than $8 billion in automotive sales in 2024 and dominates Si/SiC power modules and drivers. The company's $2 billion planned investment in a Czech Republic SiC facility — described by management as potentially "one of the largest private investments in the history of the Czech Republic" — is subject to regulatory approval and government subsidies. The company has $3.35 billion in long-term debt and $2.69 billion in cash, creating a net debt position. While the debt is low-cost (0% and 0.50% convertible notes), the company has been aggressive with share repurchases — $650 million in FY2024 and $300 million in Q1 2025 alone — at a time when revenue is declining. The goodwill balance of $1.59 billion, including $748.9 million in accumulated impairment losses in the AMG segment, also creates balance sheet risk if future acquisitions underperform. Unlike fabless competitors who rely entirely on external foundries, ON Semiconductor operates 19 manufacturing sites in 9 countries, including internal fabrication for power semiconductors in South Korea ($1.42 billion in net PPE), the United States ($1.41 billion), and the Czech Republic ($612 million). The Fab Right strategy optimizes this footprint by internalizing high-margin, differentiated products while using external foundries for commoditized or peak-demand products, creating a capital-efficient model that generated $1.21 billion in free cash flow in FY2024 on $694 million in capex — compared to $438 million in free cash flow on $1.54 billion in capex in 2022. CEO Hassane El-Khoury led Cypress Semiconductor from a struggling commodity memory company to a focused automotive and IoT semiconductor leader that commanded a $9.3 billion acquisition price from Infineon. ON Semiconductor is investing up to $2 billion in a brownfield SiC semiconductor facility in the Czech Republic, which would establish a Central European supply chain to service European automotive OEMs' rapidly increasing demand for intelligent power semiconductors. The January 2025 acquisition of Qorvo's SiC JFET technology for $118.8 million specifically targets high energy efficiency and power density in the AC-DC stage of AI server power supply units. The October 2025 acquisition of Aura Semiconductor's Vcore power technologies for up to $144 million further expands the power management portfolio for data center applications. The 2024 business realignment affected approximately 1,600 employees and incurred $133.9 million in restructuring charges, but management believes these actions will improve long-term profitability. The company has committed to returning 50% of free cash flow to shareholders through share repurchases, and it has a $3 billion share repurchase authorization in place. In FY2024, the company returned 54% of free cash flow through $650 million in buybacks. In Q1 2025, it returned 66% of free cash flow through buybacks. The 2027 targets — 10-12% revenue CAGR, 53% gross margin, 40% operating margin, $3.5-4.0 billion in free cash flow — are ambitious but built on specific initiatives with measurable milestones. The January 2025 acquisition of Qorvo's SiC JFET technology for $118.8 million specifically targets the AC-DC stage in power supply units for AI data centers, complementing the company's existing EliteSiC portfolio. This capital efficiency directly flows to free cash flow, which management targets at 25-30% of revenue ($3.5-4.0 billion in 2027) compared to 17.1% in FY2024. Industry analysis suggests ON Semiconductor's SiC products carry EBITDA margins exceeding 40%, well above the company average. The company is investing up to $2 billion in a Czech Republic SiC facility to capture this opportunity, with production expected to ramp in the 2026-2027 timeframe. The first quarter 2025 revenue of $1.45 billion, down 22.4% year-over-year, suggests that the downturn is not yet over. ON Semiconductor paid $2.4 billion in cash — approximately $20 per share — to acquire Fairchild, a pioneer in power semiconductors that had been founded in 1957 and had invented the planar transistor and the integrated circuit. The acquisition created a top-10 non-memory semiconductor supplier with almost $5 billion in pro forma revenue and a comprehensive power management portfolio. Management projected $160 million in annual cost savings by the end of 2017, $200 million by 2018, and $225 million by 2019. At Cypress, he had transformed the company from a struggling commodity memory supplier into a focused automotive and IoT semiconductor leader, culminating in its $9.3 billion acquisition by Infineon in April 2020. Revenue grew from $5.26 billion in 2020 to a peak of $8.33 billion in 2022, a 58% increase in two years. Free cash flow surged from negative territory to $1.21 billion in 2024. And the company's market capitalization grew from approximately $8 billion at the start of El-Khoury's tenure to $22.5 billion by April 2025. But the company's structural improvements — Fab Right manufacturing, portfolio rationalization, and capital discipline — allowed it to generate $1.21 billion in free cash flow despite the revenue decline, a performance that would have been impossible in the pre-El-Khoury era.