ON Semiconductor Corp (NASDAQ:ON) stock rose 2% (As on February 11, 11:32:54 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for the fourth quarter of FY 24. Revenue from Power Solutions Group (PSG) declined 16% year over year to $809.4 million, Analog and Mixed-Signal Group (AMG) decreased 18% year over year to $610.6 million and Intelligent Sensing Group (ISG) fell 2% year over year to $302.5 million. The adjusted gross margin declined by 140 bps to 45.3% while the adjusted operating margin decreased by 490 bps to 26.7%, implying semiconductor industry pricing pressures. ON Semiconductor generated $422.4 million in free cash flow and held $2.99 billion in cash and equivalents as of December 31, 2024.

Meanwhile, the company’s automotive revenue increased 8% sequentially in the fourth quarter, driven by share gains and new customer ramps, particularly in China. ON Semiconductor Corp (ON) reported significant growth in AI data center and aerospace and defense sectors, with revenue increases of more than 40% and 50% respectively in 2024 over 2023. The company successfully closed the acquisition of Qorvo’s silicon carbide junction field effect transistor business, enhancing its EliteSiC power solutions. ON Semiconductor Corp (ON) introduced the Treo platform, a new analog and mixed-signal platform, which is expected to unlock a $36 billion total addressable market opportunity with up to 70% gross margins. However, the company experienced a sequential decline in regional revenue, with Japan seeing the sharpest decline, and continued inventory digestion in key end markets. ON Semiconductor Corp (ON) anticipates continued volatility in the automotive sector due to geopolitical uncertainty and slower-than-expected EV ramp-up. The company expects a significant decline in automotive revenue in Q1 2025, projected to be down 25% or more sequentially, primarily due to softness in China.

ON in the fourth quarter of FY 24 has reported the adjusted earnings per share of 95 cents, missing the analysts’ estimates for the adjusted earnings per share of 98 cents, according to Zacks Investment Research. The company had reported the adjusted revenue decline of 14.7 percent to $1.72 billion in the fourth quarter of FY 24, missing the analysts’ estimates for revenue of $1.76 billion.

For the current quarter ending in March, ON Semiconductor Corp. expects its per-share earnings to range from 45 cents to 55 cents, below the consensus of $0.89 and an adjusted gross margin of 39.0%-41.0%. ON Semiconductor expects first-quarter adjusted revenue of $1.35 billion—$1.45 billion, below the consensus of $1.69 billion.