ON Semiconductor shares closed down 9.02% at $66.60 after its own investor day, where the total addressable market presented was $213 billion, $30 billion below the $243 billion figure the company cited in June when it announced the Synaptics acquisition. CEO Hassane El-Khoury told CNBC the smaller number reflects the core onsemi business, since the Synaptics deal, expected to close in mid-2027, keeps the two companies separate until antitrust review concludes. He described the AI data center growth assumption as anchored to a 30% market, the middle of the range, plus 10 points of outgrowth, a claim testable only through design wins such as expanded content in the NVIDIA MGX ecosystem, two power-supply platform wins with Great Wall in China, and AWS power-supply and battery-backup content in the United States. Management's 53% gross margin target compares with a Q2 non-GAAP gross margin of 39.3%, and the company's sensitivity of 25 to 30 basis points of gross-margin improvement per point of utilization shows how much depends on volume that has not yet arrived. The stock carries a forward P/E near 17 against an average analyst target of $106.88, while a trailing P/E of 47 leaves little room for another miss.
ON Semiconductor CorporationInvestor day cut the total addressable market to $213B from $243B, with a 53% gross-margin target far above the 39.3% Q2 level, pressuring the stock.
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