Power Integrations Inc

Power Integrations reported second-quarter revenue of $118.9 million, up 3% year-over-year and 10% sequentially, with non-GAAP gross margin reaching 55.1% and non-GAAP operating margin expanding to 17.1%. Non-GAAP net income was $20.9 million, or $0.37 per diluted share, and the company generated $22 million in operating cash flow. Industrial revenue grew 14% in the quarter, while channel inventory normalized to 7.3 weeks. For the third quarter, the company expects revenue between $122 million and $130 million and non-GAAP gross margin between 54% and 55%.

Power Integrations has released ultra-slim, 15 W and 35 W auxiliary power supply reference designs optimized for the NVIDIA Kyber 800 VDC AI data center architecture. By using 1700 V-rated PowiGaN technology, these compact solutions reduce board space and bill of materials by 30 percent while maintaining at least 88 percent efficiency. The designs integrate InnoMux-2 ICs to provide reliable power for internal data center components, such as gate drivers and MCUs. The use of single-HEMT 1700 V GaN technology allows for a highly efficient, space-saving alternative to bulky, discrete silicon carbide solutions, ensuring wide safety margins on 800 V buses. The technology provides engineers with a more reliable, efficient foundation for managing critical control functions within demanding, high-voltage data center environments.

Shares of Entegris, Kulicke and Soffa, and Power Integrations rose in afternoon trading after a cooler-than-expected June inflation report and a surprise capital expenditure warning from IBM validated AI hardware demand. June core CPI was flat month-over-month, reopening the door to a friendlier interest rate environment, while IBM CEO Arvind Krishna revealed that clients shifted enterprise budgets toward servers, storage, and memory to secure supply-constrained AI infrastructure. The soft inflation print lowers the discount rate, benefiting high-multiple semiconductor valuations, and IBM's warning acts as direct confirmation that AI infrastructure spending is not slowing down. Entegris jumped 3.2%, Kulicke and Soffa jumped 3.4%, and Power Integrations jumped 3.3%. The market is treating the IBM commentary as a strong fundamental signal ahead of Taiwan Semiconductor Manufacturing Company's earnings later in the week.

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.

Stifel raised its price target on Power Integrations to $95 from $82 and kept a Buy rating on the shares. The firm said its earlier view that analog players were poised for a breakout in 2026 has been validated by beat-and-raise quarters from Astera Labs, Credo Technology, and Marvell. Needham initiated coverage with a Buy rating and $90 price target, citing the company's leading high-power GaN portfolio and new management's strategic priorities. Susquehanna also raised its target to $85 from $70 with a Positive rating after positive first-quarter results.

The analog semiconductor industry delivered a strong first quarter, with the 15 stocks tracked beating revenue consensus by 1.5% and next-quarter guidance coming in 5.7% above expectations. Texas Instruments reported the biggest beat, with revenue of $4.83 billion, up 18.6% year on year and 6.6% above estimates, while Power Integrations posted revenue of $108.3 million, up 2.6% and exceeding expectations by 1.6%. Universal Display was the weakest performer, with revenue of $142.2 million, down 14.5% and missing estimates by 11%, and it also issued full-year guidance below expectations. Impinj reported flat revenue of $74.25 million, beating estimates by 2.4%, and MACOM posted revenue of $289 million, up 22.5% and topping estimates by 1.2%, while also delivering the highest guidance raise among peers. Share prices of the group have risen 11.4% on average since the latest earnings results.

Power Integrations, Inc. is positioned to benefit from long-term secular trends including electrification, renewable energy adoption, and AI-driven infrastructure investments that increase demand for efficient power management solutions. The company designs high-voltage semiconductor chips used in products ranging from smartphone chargers to electric vehicles and solar installations, and it has been expanding into higher-value industrial markets such as renewable energy, energy storage, and factory automation. Management is directing R&D toward technically demanding power-conversion challenges, while broader industry dynamics like accelerating EV adoption and expanding AI data centers create greater demand for efficient power transmission. Rising trading volume and improving price momentum suggest growing investor confidence, with shares trading at $87.11 as of June 18th and a forward P/E of 63.29.

The 15 analog semiconductor stocks tracked by StockStory reported a strong first quarter, with aggregate revenues beating analyst consensus estimates by 1.5% and next-quarter revenue guidance coming in line. Texas Instruments delivered the best performance, reporting revenues of $4.83 billion, up 18.6% year over year and exceeding expectations by 6.6%, while Universal Display was the weakest, with revenues of $142.2 million, down 14.5% year over year and missing estimates by 11%. Skyworks Solutions reported revenues of $943.7 million, flat year over year but beating estimates by 4.6%, though its stock fell 1.1% since the release. Other notable performers included Vishay Intertechnology, which posted revenues of $839.2 million, up 17.3% year over year, and Power Integrations, with revenues of $108.3 million, up 2.6% year over year. Share prices across the group have risen 17.1% on average since the latest earnings results.