ON Semiconductor Corporation

Wolfspeed, STMicroelectronics, and ON Semiconductor rallied Monday after Mizuho flagged a faster NVIDIA Vera Rubin ramp anchored by xAI and Meta starting in the fourth quarter of 2026. Wolfspeed rose 5.74% to $33.61, STMicroelectronics gained 4.17% to $56.56, and ON Semiconductor added 2.96% to $85.11. Mizuho expects strong VR200 NVL72 ramps in 2027, with 2027 CoWoS growing more than 75% and cloud service provider backlog now at $2.3 trillion, up 3.5 times year over year. ON Semiconductor says power content per rack rises from $15,000 to $115,000 under 800-volt DC architecture, with AI data center revenue expected to more than double in 2026. The next checkpoints are ON Semiconductor's Analyst Day on September 16, 2026, and NVIDIA's next quarterly update.

ON Semiconductor reported second-quarter revenue of $1.6 billion, a 6% sequential increase driven by accelerated demand in AI data centers, with non-GAAP gross margin expanding 80 basis points to 39.3% and non-GAAP earnings per share rising 16% to $0.74. The company now expects AI data center revenue to more than double in 2026, supported by design wins in the Nvidia MGX ecosystem and Amazon’s AWS power supply platforms, while energy storage systems revenue is forecast to grow approximately 40% year over year. Automotive silicon carbide revenue in China is projected to increase between 60% and 70% in 2026, reflecting market share gains with customers such as Geely Zeekr and Xiaomi. Free cash flow nearly quadrupled year over year to $425 million, and the company returned $332 million to shareholders through share repurchases. For the third quarter, ON Semiconductor guided revenue of $1.65 billion to $1.75 billion, non-GAAP gross margin of 40% to 42%, and non-GAAP earnings per share of $0.81 to $0.93.

U.S. stocks were mixed on Thursday as a rebound in chipmakers and stronger-than-expected economic data helped offset a sell-off in software shares following disappointing earnings. The S&P 500 edged up 0.07%, the Dow fell 0.38%, and the Nasdaq 100 added 0.26%. Datadog tumbled over 14% after reporting second-quarter adjusted gross margin below consensus, dragging down other software names including Salesforce, Atlassian, and Workday. AppLovin sank 19% on a revenue miss, while memory chipmakers Western Digital and SanDisk fell sharply after SanDisk forecast first-quarter revenue of $10.30 billion to $10.80 billion, below the $11.16 billion consensus. Limiting losses, ARM Holdings rose more than 5% and ASML, ON Semiconductor, and Marvel Technology gained over 2%, while Paycom Software surged 22% after raising its full-year revenue outlook to $2.20 billion to $2.21 billion, above estimates. Weekly jobless claims rose by 1,000 to 199,000, better than the 205,000 expected, and second-quarter nonfarm productivity increased 1.4%, exceeding the 0.6% forecast. A Financial Times report that Fed Chair Warsh is willing to raise rates in September if inflation firms weighed on sentiment, while crude oil rose over 1% after Yemen's Houthi rebels said they targeted a Saudi oil tanker in the Gulf of Aden.

ON Semiconductor stock rose about 2% on Tuesday after its second-quarter results and outlook drew favorable analyst views, with artificial-intelligence data centers emerging as an important source of demand. Jefferies maintained its Buy rating and $115 price target, noting AI data-center growth could outpace other analog markets. Susquehanna kept a Positive rating with a $150 target, citing progress in customer activity and lead times increasing by about five weeks on average. Morgan Stanley said the June quarter was broadly in line and the September outlook slightly ahead of expectations, with AI data-center demand remaining a key contributor.

ON Semiconductor reported second-quarter net income of $226.8 million, up from $170.3 million a year earlier, driven by accelerating demand from AI data center customers. Adjusted earnings reached $0.74 per share, surpassing the $0.71 consensus estimate from FactSet-polled analysts, while revenue rose 9% to $1.6 billion, slightly above the $1.59 billion projection. The company's Power Solutions Group led growth with a 19% revenue increase to $829 million, and free cash flow quadrupled to $425.4 million. Looking ahead, ON Semiconductor guided for third-quarter revenue between $1.65 billion and $1.75 billion and adjusted earnings of $0.81 to $0.93 per share, bracketing the FactSet consensus of $0.83 per share on $1.67 billion in revenue.

Several major companies saw significant premarket stock moves following their latest quarterly earnings reports. McDonald's gained 1.9% after posting adjusted earnings of $3.38 per share, beating the LSEG consensus of $3.32, though revenue of $7.1 billion missed the expected $7.13 billion. Caterpillar climbed 8% after reporting adjusted earnings of $8.17 per share on revenue of $20.54 billion, both exceeding analyst expectations of $6.20 per share and $19.34 billion. Palantir Technologies surged 15% on second-quarter results driven by a nearly 150% jump in U.S. commercial revenue. Merck rose more than 1% after losing an adjusted 13 cents per share on revenue of $16.61 billion, better than the anticipated loss of 27 cents per share on $16.36 billion, and raised its full-year revenue guidance. Pfizer gained after beating estimates with adjusted earnings of 77 cents per share on revenue of $15.03 billion and increasing the low end of its full-year revenue outlook. On Semiconductor jumped 7% on better-than-expected second-quarter results and margins. Snap rose 5% after revenue of $1.6 billion topped the $1.54 billion estimate, with global daily active users and average revenue per user also exceeding expectations. Whirlpool was little changed after a larger-than-expected adjusted loss of 21 cents per share and a lowered full-year earnings forecast. Wayfair fell 4% despite beating estimates with earnings of 95 cents per share on revenue of $3.52 billion. DigitalOcean plunged 11% even though second-quarter earnings of 45 cents per share on revenue of $281 million surpassed analyst expectations.

Palantir Technologies, Snap, and ON Semiconductor were among the biggest stock gainers on Tuesday, while Powell Industries led the losers. Palantir shares surged 15% after crushing second-quarter results and raising its full-year outlook, with revenue jumping 93% year-over-year to $1.94 billion and its fiscal 2026 revenue forecast lifted to $8.15 billion to $8.16 billion. Snap gained 9% on better-than-expected second-quarter earnings, 19% revenue growth to $1.6 billion, and daily active users reaching 493 million. ON Semiconductor climbed 7% after issuing stronger-than-expected third-quarter guidance, forecasting revenue of $1.65 billion to $1.75 billion and adjusted earnings per share of $0.81 to $0.93. Powell Industries fell 14% despite a 158% surge in new orders to $934 million, as its quarterly revenue of $312 million and earnings per share of $1.42 missed estimates.

Onsemi expects its AI data center revenue to more than double in 2026, as the company guided third-quarter earnings per share to a range of $0.81 to $0.93. The chipmaker reported second-quarter revenue of $1.6 billion, with non-GAAP gross margin of 39.3% and non-GAAP diluted earnings per share of $0.74, all above the midpoint of its guidance. Management noted that supply is tightening in several growth areas, lead times are extending, and the company prioritized AI data center shipments over automotive and industrial segments in the quarter. Onsemi also announced an agreement to acquire Synaptics, with the transaction expected to close in mid-2027, and is implementing a second round of price increases to offset rising input costs. Free cash flow nearly quadrupled in the quarter, reaching $425 million, and the company returned $332 million to shareholders through share repurchases.

US stocks extended their rally, with the Dow Jones Industrial Average closing up 693.38 points at 53,178.41 and the Nasdaq Composite up 540.05 points at 25,913.90. Investor sentiment improved after President Trump called off a planned large-scale attack on Iran over the weekend and announced a resumption of negotiations, sending stocks higher after the open. A rise in the ISM manufacturing index, lower oil prices, and falling interest rates also provided a tailwind, pushing the Dow to a new all-time high. By sector, media and entertainment as well as software and services gained, while energy declined. Among individual stocks, Bristol Myers Squibb rose on reports of merger talks with AstraZeneca, and Boeing advanced on certification of the 737 Max 10. AMC Entertainment and IMAX were bought up after setting new weekend box office records, but Marriott fell after its third-quarter outlook missed expectations. Palantir Technologies and ON Semiconductor were being bought in after-hours trading following their earnings releases.

A slate of major companies including Palantir Technologies, Vertex Pharmaceuticals, and Diamondback Energy are set to report quarterly earnings after the market closes on August 3, 2026. Palantir is expected to post earnings per share of $0.28, a 115.38% jump from the same quarter last year, while Vertex's consensus stands at $4.30, up 7.50%. Diamondback Energy's forecast of $6.08 per share represents a 127.72% surge, though it missed estimates in the fourth quarter of 2025. Other notable reports include ONEOK with a consensus of $1.39, ON Semiconductor at $0.72, and SBA Communications at $2.76, which would mark a 12.93% decline year-over-year. Sterling Infrastructure is projected to deliver $5.00 per share, a 96.08% increase, and Jazz Pharmaceuticals is expected to swing to $5.06 per share after a large miss in the prior-year quarter.

Analysts have raised near-term earnings and revenue estimates for ON Semiconductor Corp., even as the stock has lagged the broader market. Heartland Advisors pointed to the company's strength in power management and image sensing for electric vehicles and AI datacenters, along with its shift toward higher-margin products and more efficient manufacturing. The June launch of ON's Elite Pairing Studio is seen as directly supporting its push into silicon carbide power solutions for EVs and AI data centers, potentially reinforcing the earnings momentum analysts now expect. However, ongoing underutilized capacity could still weigh on margins, and the biggest risk remains soft auto and EV demand outside China keeping factories underused.

Heartland Mid Cap Value Fund highlighted ON Semiconductor Corporation as a beneficiary of rising power demand in its second-quarter 2026 investor letter. The fund noted that ON Semiconductor is a leader in silicon carbide semiconductors used in electric vehicles, renewable energy inverters, and high-power industrial equipment, and that the company has gained market share with leading global EV manufacturers. In AI datacenters, increasing power voltage requirements are driving adoption of ON's next-generation power management solutions, though datacenter-related revenue is expected to remain a materially smaller percentage of sales compared to its core automotive and industrial markets. After the stock more than doubled in price by early June and reached the fund's price target, Heartland reduced its weighting but intends to maintain a reasonably sized position, acknowledging that multiple drivers have come together simultaneously, creating potential for an intrinsic value scenario.

Microchip Technology and onsemi shares rose over 3% in afternoon trading after a cooler-than-expected June inflation report and IBM's warning that clients are shifting budgets to AI infrastructure boosted semiconductor stocks. June core CPI was flat month-over-month, with a 2.6% year-over-year increase versus a 2.9% forecast, reopening the door to a friendlier interest rate environment. IBM CEO Arvind Krishna disclosed that second-quarter revenue missed expectations because enterprise clients abruptly redirected spending toward servers, storage, and memory to secure supply-constrained AI hardware ahead of anticipated price hikes. The combination of a macro tailwind and direct confirmation of sustained AI infrastructure demand lifted chip valuations, with the specific mention of memory purchases driving outsized gains in Micron and SanDisk. Additional optimism came from Intel's €5 billion investment in its Ireland facility to boost Xeon 6 processor production and Tower Semiconductor's expansion of 300mm manufacturing in Japan with government support.

Analog chipmakers are emerging as beneficiaries of the artificial intelligence infrastructure boom, according to Bank of America. The firm expects most AI-related sales across the analog chip group to grow 50% to more than 100% this year, driven by massive power management needs in AI data centers. Analyst Vivek Arya noted that after a prolonged inventory correction, customers are beginning to restock analog hardware as industrial demand improves, creating a positive backdrop for the second half of 2026. Bank of America highlighted Analog Devices, ON Semiconductor, Texas Instruments, and Allegro MicroSystems as key names poised for further gains.

Shares of Entegris, onsemi, and Power Integrations surged in afternoon trading as semiconductor stocks rebounded on dip buying and reports that China may ease restrictions on advanced Nvidia AI chip imports. Entegris jumped 8.2%, onsemi gained 7.3%, and Power Integrations rose 7%. The sector-wide rally was fueled by a report that Chinese authorities may soon allow Alibaba, ByteDance, and DeepSeek to purchase a limited quantity of Nvidia H200 AI processors, capped under 200,000 units. Additionally, SK Hynix's $24.5 billion U.S. ADR offering was oversubscribed by more than seven times, signaling robust institutional demand for AI memory chips.

Semiconductor and optical stocks surged on Thursday, rebounding from a recent sell-off as US manufacturing investments mount. Micron Technology jumped 8% after revealing it is accelerating its planned US fab and technology investments, increasing expected spend to more than $250 billion through 2035, up from $200 billion previously. Broadcom increased 4% after disclosing a partnership with Apple expected to exceed $30 billion, leading to production of over 15 billion US-made chips. Sandisk shares surged 11% as Wedbush raised its fourth-quarter revenue estimate to $8.89 billion from $8 billion, while Western Digital climbed 7%. AMD was up nearly 6% after announcing a collaboration with 5C on gigascale AI campuses, and onsemi popped nearly 8% after announcing the sale of two manufacturing facilities as part of its Fab Right strategy. Optical stocks also moved sharply higher, with Lumentum surging 12%, Applied Optoelectronics up 9%, Ciena climbing 6%, and Corning increasing 7%. The Philadelphia Semiconductor Index rose 4.6%.

ON Semiconductor has agreed to sell its manufacturing facilities in Tarlac, Philippines, to Greatek Electronics and in Mountain Top, Pennsylvania, to Silex Microsystems, a move management says will optimize its manufacturing footprint and improve long-term economics. The transactions include structured transition plans and long-term supply agreements to ensure uninterrupted customer deliveries, with onsemi expecting approximately $35 million in annual cost savings beginning in 2027 and fully realized in 2028. The divestitures reinforce the company's Fab Right strategy by concentrating production in higher-efficiency facilities aligned with AI data centers, automotive, and industrial markets, and follow three consecutive quarters of gross-margin expansion to 38.5% in the first quarter of 2026. The company faces competition from Texas Instruments, which reported a 58% gross margin in the first quarter, and Navitas Semiconductor, which is targeting high-power gallium nitride and silicon carbide applications. Shares of onsemi have risen 68.2% year to date, and the Zacks Consensus Estimate for 2026 earnings is $3.09 per share, implying 31.5% growth from 2025.

Cantor Fitzgerald raised its price target on ON Semiconductor Corporation to $110 from $100 while maintaining a Neutral rating. Analyst Matthew Prisco cited the AI infrastructure buildout as a durable generational semiconductor cycle, projecting industry revenue could reach roughly $3 trillion by 2029 and potentially exceed $3.5 trillion by 2030. Separately, ON Semiconductor agreed to acquire Synaptics in an all-stock deal valued at about $7 billion, its largest acquisition, with Synaptics shareholders receiving 1.350 Onsemi shares per Synaptics share, a 19% premium based on the 10-day volume-weighted average closing prices. CEO Hassane El-Khoury said the deal would speed Onsemi's push into physical AI and expand its addressable market by $30 billion to $243 billion by 2030.

ON Semiconductor and Rockwell Automation are positioned to benefit from the coming shift in artificial intelligence spending toward inference, according to an analysis. ON Semiconductor's AI data center revenue reached about $250 million in 2025, roughly 4.2% of its $6 billion total, and is expected to double in 2026. Rockwell Automation integrates Nvidia's applications into its industrial automation software, enabling customers to build digital twins and embed AI inference across operations. Both companies currently have relatively low AI exposure but are expected to see significant long-term growth as inference spending expands beyond data centers into edge environments.

Vishay Intertechnology and ON Semiconductor are both benefiting from automotive electrification and AI infrastructure spending, but Vishay's aggressive transformation strategy is giving it a stronger growth narrative. Vishay's first-quarter 2026 revenues rose 17.3% year over year to $839 million, with a book-to-bill ratio of 1.34 and backlog up 21% to $1.6 billion, driven by market share gains in automotive and industrial markets. ON Semiconductor's first-quarter revenues improved 5% to $1.51 billion, with gross margin rising to 38.5%, and it holds roughly 55% share of silicon carbide solutions in new EV models at the 2026 Beijing Auto Show. While both stocks have surged in 2026, with VSH gaining 313.5% compared with ON's 119.3%, Vishay's accelerating momentum and expanding competitive position make it the more compelling auto semiconductor stock, despite its higher forward P/E of 52.79 versus ON's 32.06.