Returned 54% of 2024 Free Cash Flow through
share repurchases
onsemi (the “Company”) (Nasdaq: ON) today announced its
fourth quarter and fiscal year 2024 results with the following
highlights:
- Fourth quarter revenue of $1,722.5 million
- Fourth quarter GAAP gross margin and non-GAAP gross margin of
45.2% and 45.3%, respectively
- Fourth quarter GAAP operating margin and non-GAAP operating
margin of 23.7% and 26.7%, respectively
- Fourth quarter GAAP diluted earnings per share of $0.88 and
non-GAAP diluted earnings per share of $0.95, respectively
- Full year 2024 free cash flow of $1.2 billion, a 3X increase
year-over-year
“As we continue to navigate this market downturn, our actions
over the last four years have proven we are a structurally
different company that is well-equipped to navigate prolonged
volatility,” said Hassane El-Khoury, president and CEO, onsemi.
“While 2025 remains uncertain, we remain committed to our long-term
strategy. We will maintain our financial discipline, streamline our
operations and continue to deliver high-value, differentiated
intelligent power and sensing solutions that position onsemi to
emerge even stronger.”
Selected financial results for the quarter are shown below
with comparable periods:
GAAP
Non-GAAP
Three Months Ended
Three Months Ended
(Revenue and Net Income in millions)
Q4 2024
Q3 2024
Q4 2023
Q4 2024
Q3 2024
Q4 2023
Revenue
$1,722.5
$1,761.9
$2,018.1
$1,722.5
$1,761.9
$2,018.1
Gross Margin
45.2 %
45.4 %
46.7 %
45.3 %
45.5 %
46.7 %
Operating Margin
23.7 %
25.3 %
30.3 %
26.7 %
28.2 %
31.6 %
Net Income attributable to onsemi
$379.9
$401.7
$562.7
$404.2
$423.8
$540.9
Diluted Earnings Per Share
$0.88
$0.93
$1.28
$0.95
$0.99
$1.25
Selected financial results for 2024 and 2023 are shown
below:
GAAP
Non-GAAP
Year Ended
Year Ended
(Revenue and Net Income in millions)
December 31, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Revenue
$7,082.3
$8,253.0
$7,082.3
$8,253.0
Gross Margin
45.4 %
47.1 %
45.5 %
47.1 %
Operating Margin
25.0 %
30.8 %
27.9 %
32.3 %
Net Income attributable to onsemi
$1,572.8
$2,183.7
$1,704.6
$2,256.2
Diluted Earnings Per Share
$3.63
$4.89
$3.98
$5.16
Revenue Summary
($ in millions)
(Unaudited)
Three Months Ended
Business Segment (1)
Q4 2024
Q3 2024
Q4 2023
Sequential Change
Year-over- Year Change
PSG
$
809.4
$
829.4
$
965.6
(2)%
(16)%
AMG
610.6
653.7
744.8
(7)%
(18)%
ISG
302.5
278.8
307.7
9 %
(2)%
Total
$
1,722.5
$
1,761.9
$
2,018.1
(2)%
(15)%
Year Ended
Business Segment (1)
December 31, 2024
December 31, 2023
Year-over- Year Change
PSG
$
3,348.2
$
3,880.4
(14)%
AMG
2,609.1
3,057.1
(15)%
ISG
1,125.0
1,315.5
(14)%
Total
$
7,082.3
$
8,253.0
(14)%
(1)
During the first quarter of 2024, the
Company reorganized certain reporting units and its segment
reporting structure. As a result of the reorganization of divisions
within PSG and AMG, the prior-period amounts have been reclassified
to conform to current-period presentation.
FIRST QUARTER 2025 OUTLOOK
The following table outlines onsemi's projected first quarter of
2025 GAAP and non-GAAP outlook.
Total onsemi
GAAP
Special
Items **
Total onsemi
Non-GAAP ***
Revenue
$1,350 to $1,450 million
—
$1,350 to $1,450 million
Gross Margin
38.9% to 40.9%
0.1%
39.0% to 41.0%
Operating Expenses
$329 to $344 million
$16 million
$313 to $328 million
Other Income and Expense (including
interest expense), net
($14 million)
—
($14 million)
Diluted Earnings Per Share
$0.42 to $0.52
$0.03
$0.45 to $0.55
Diluted Shares Outstanding *
426 million
1 million
425 million
*
Diluted shares outstanding can vary as a
result of, among other things, the vesting of restricted stock
units, the incremental dilutive shares from the Company's
convertible senior subordinated notes, and the repurchase or the
issuance of stock or convertible notes or the sale of treasury
shares. In periods when the quarterly average stock price per share
exceeds $52.97 for the 0% Notes, and $103.87 for the 0.50% Notes,
the non-GAAP diluted share count and non-GAAP net income per share
include the anti-dilutive impact of the Company’s hedge
transactions issued concurrently with the 0% Notes and the 0.50%
Notes, respectively. At an average stock price per share between
$52.97 and $74.34 for the 0% Notes and $103.87 and $156.78 for the
0.50% Notes, the hedging activity offsets the potentially dilutive
effect of the 0% Notes and 0.50% Notes, respectively. In periods
when the quarterly average stock price exceeds $74.34 for the 0%
Notes, and $156.78 for the 0.50% Notes, the dilutive impact of the
warrants issued concurrently with such notes are included in the
diluted shares outstanding. GAAP and non-GAAP diluted share counts
are based on the average stock price for the month subsequent to
the end of the previous quarter.
**
Special items may include: amortization of acquisition-related
intangibles; expensing of appraised inventory fair market value
step-up; purchased in-process research and development expenses;
restructuring, asset impairments and other, net; goodwill and
intangible asset impairment charges; gains and losses on debt
prepayment; non-cash interest expense; actuarial (gains) losses on
pension plans and other pension benefits; and certain other special
items, as necessary. These special items are out of our control and
could change significantly from period to period. As a result, we
are not able to reasonably estimate and separately present the
individual impact or probable significance of these special items,
and we are similarly unable to provide a reconciliation of the
non-GAAP measures. The reconciliation that is unavailable would
include a forward-looking income statement, balance sheet and
statement of cash flows in accordance with GAAP. For this reason,
we use a projected range of the aggregate amount of special items
in order to calculate our projected non-GAAP operating expense
outlook.
***
We believe these non-GAAP measures provide important supplemental
information to investors. We use these measures, together with GAAP
measures, for internal managerial purposes and as a means to
evaluate period-to-period comparisons. However, we do not, and you
should not, rely on non-GAAP financial measures alone as measures
of our performance. We believe that non-GAAP financial measures
reflect an additional way of viewing aspects of our operations
that, when taken together with GAAP results and the reconciliations
to corresponding GAAP financial measures that we also provide in
our releases, provide a more complete understanding of factors and
trends affecting our business. Because non-GAAP financial measures
are not standardized, it may not be possible to compare these
financial measures with other companies' non-GAAP financial
measures, even if they have similar names.
TELECONFERENCE
onsemi will host a conference call for the financial community
at 9 a.m. Eastern Time (EST) on Feb. 10, 2025 to discuss this
announcement and onsemi’s results for the fourth quarter of 2024
and fiscal year 2024. The Company will also provide a real-time
audio webcast of the teleconference on the Investor Relations page
of its website at http://www.onsemi.com. The webcast replay will be
available at this site approximately one hour following the live
broadcast and will continue to be available for approximately 30
days following the conference call. Investors and interested
parties can also access the conference call by pre-registering
here.
About onsemi
onsemi (Nasdaq: ON) is driving disruptive innovations to
help build a better future. With a focus on automotive and
industrial end-markets, the company is accelerating change in
megatrends such as vehicle electrification and safety, sustainable
energy grids, industrial automation, and 5G and cloud
infrastructure. onsemi offers a highly differentiated and
innovative product portfolio, delivering intelligent power and
sensing technologies that solve the world’s most complex challenges
and leads the way to creating a safer, cleaner, and smarter world.
onsemi is recognized as a Fortune 500® company and included
in the Nasdaq-100 Index® and S&P 500® index. Learn more about
onsemi at www.onsemi.com.
onsemi and the onsemi logo are trademarks of Semiconductor
Components Industries, LLC. All other brand and product names
appearing in this document are registered trademarks or trademarks
of their respective holders. Although the Company references its
website in this news release, information on the website is not to
be incorporated herein.
This document includes “forward-looking statements,” as that
term is defined in Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical facts,
included or incorporated in this document could be deemed
forward-looking statements, particularly statements about the
future financial performance of onsemi, including financial
guidance for the first fiscal quarter of 2025. Forward-looking
statements are often characterized by the use of words such as
“believes,” “estimates,” “expects,” “projects,” “may,” “will,”
“intends,” “plans,” “anticipates,” “should” or similar expressions
or by discussions of strategy, plans or intentions. All
forward-looking statements in this document are made based on our
current expectations, forecasts, estimates and assumptions and
involve risks, uncertainties, and other factors that could cause
results or events to differ materially from those expressed in the
forward-looking statements. Certain factors that could affect our
future results or events are described under Part I, Item 1A “Risk
Factors” in our 2024 Annual Report on Form 10-K filed with the
Securities and Exchange Commission (“SEC”) on February 10, 2025
(our “2024 Form 10-K”), and from time-to-time in our other SEC
reports (including in our 2024 Form 10-K). Readers are cautioned
not to place undue reliance on forward-looking statements. We
assume no obligation to update such information, except as may be
required by law. Investing in our securities involves a high degree
of risk and uncertainty, and you should carefully consider the
trends, risks, and uncertainties described in this document, our
2024 Form 10-K and other reports filed with or furnished to the SEC
before making any investment decision with respect to our
securities. If any of these trends, risks, or uncertainties
actually occurs or continues, our business, financial condition or
operating results could be materially adversely affected, the
trading prices of our securities could decline, and you could lose
all or part of your investment. All forward-looking statements
attributable to us or persons acting on our behalf are expressly
qualified in their entirety by this cautionary statement.
ON SEMICONDUCTOR
CORPORATION
UNAUDITED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in millions, except per share
and percentage data)
Quarter Ended
Year Ended
December 31, 2024
September 27, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Revenue
$
1,722.5
$
1,761.9
$
2,018.1
$
7,082.3
$
8,253.0
Cost of revenue
943.4
962.5
1,076.2
3,866.2
4,369.5
Gross profit
779.1
799.4
941.9
3,216.1
3,883.5
Gross margin
45.2
%
45.4
%
46.7
%
45.4
%
47.1
%
Operating expenses:
Research and development
155.2
151.0
150.2
612.7
577.3
Selling and marketing
70.4
65.4
67.5
273.5
279.1
General and administrative
100.5
95.5
88.6
376.3
362.4
Amortization of acquisition-related
intangible assets
13.5
13.0
12.1
52.0
51.1
Restructuring, asset impairments and other
charges, net
30.9
29.1
11.4
133.9
74.9
Total operating expenses
370.5
354.0
329.8
1,448.4
1,344.8
Operating income
408.6
445.4
612.1
1,767.7
2,538.7
Other income (expense), net:
Interest expense
(15.3
)
(15.7
)
(15.8
)
(62.3
)
(74.8
)
Interest income
27.8
28.6
26.3
111.4
93.1
Loss on debt refinancing and
prepayment
—
—
—
—
(13.3
)
Loss on divestiture of business
—
—
—
—
(0.7
)
Other income (expense)
21.4
(3.7
)
(11.7
)
20.6
(7.2
)
Other income (expense), net
33.9
9.2
(1.2
)
69.7
(2.9
)
Income before income taxes
442.5
454.6
610.9
1,837.4
2,535.8
Income tax provision
(62.7
)
(51.9
)
(47.5
)
(262.8
)
(350.2
)
Net income
379.8
402.7
563.4
1,574.6
2,185.6
Less: Net (income) loss attributable to
non-controlling interest
0.1
(1.0
)
(0.7
)
(1.8
)
(1.9
)
Net income attributable to ON
Semiconductor Corporation
$
379.9
$
401.7
$
562.7
$
1,572.8
$
2,183.7
Net income for diluted earnings per share
of common stock
$
379.9
$
401.7
$
562.8
$
1,572.8
$
2,185.0
Net income per share of common stock
attributable to ON Semiconductor Corporation:
Basic
$
0.89
$
0.94
$
1.31
$
3.68
$
5.07
Diluted
$
0.88
$
0.93
$
1.28
$
3.63
$
4.89
Weighted average common shares
outstanding:
Basic
425.4
427.0
428.1
427.4
430.7
Diluted
429.6
431.7
439.5
432.7
446.8
ON SEMICONDUCTOR
CORPORATION
UNAUDITED CONSOLIDATED BALANCE
SHEETS
(in millions)
December 31, 2024
September 27, 2024
December 31, 2023
Assets
Cash and cash equivalents
$
2,691.3
$
2,470.2
$
2,483.0
Short-term investments
300.0
300.0
—
Receivables, net
1,160.1
1,070.6
935.4
Inventories
2,242.0
2,242.8
2,111.8
Other current assets
358.6
461.1
382.1
Total current assets
6,752.0
6,544.7
5,912.3
Property, plant and equipment, net
4,361.4
4,383.7
4,401.5
Goodwill
1,587.9
1,587.9
1,577.6
Intangible assets, net
257.9
273.1
299.3
Deferred tax assets
729.9
725.8
600.8
ROU financing lease assets
40.5
41.1
42.4
Other assets
360.2
367.3
381.3
Total assets
$
14,089.8
$
13,923.6
$
13,215.2
Liabilities, Non-Controlling Interest
and Stockholders’ Equity
Accounts payable
$
574.5
$
597.5
$
725.6
Accrued expenses and other current
liabilities
760.0
734.3
663.2
Current portion of financing lease
liabilities
0.3
0.4
0.8
Current portion of long-term debt
—
796.4
794.0
Total current liabilities
1,334.8
2,128.6
2,183.6
Long-term debt
3,345.9
2,547.2
2,542.6
Deferred tax liabilities
37.6
42.8
38.7
Long-term financing lease liabilities
20.7
22.4
22.4
Other long-term liabilities
536.3
578.6
627.3
Total liabilities
5,275.3
5,319.6
5,414.6
ON Semiconductor Corporation stockholders’
equity:
Common stock
6.2
6.2
6.2
Additional paid-in capital
5,372.2
5,321.9
5,210.9
Accumulated other comprehensive loss
(62.4
)
(49.1
)
(45.2
)
Accumulated earnings
8,120.9
7,741.0
6,548.1
Less: Treasury stock, at cost
(4,640.5
)
(4,435.9
)
(3,937.4
)
Total ON Semiconductor Corporation
stockholders’ equity
8,796.4
8,584.1
7,782.6
Non-controlling interest
18.1
19.9
18.0
Total stockholders' equity
8,814.5
8,604.0
7,800.6
Total liabilities and stockholders'
equity
$
14,089.8
$
13,923.6
$
13,215.2
ON SEMICONDUCTOR
CORPORATION
UNAUDITED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in millions)
Quarter Ended
Year Ended
December 31, 2024
September 27, 2024
December 31, 2023
December 31,
2024
December 31,
2023
Cash flows from operating activities:
Net income
$
379.8
$
402.7
$
563.4
$
1,574.6
$
2,185.6
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
166.6
161.8
160.3
642.9
609.5
Loss on sale or disposal of fixed
assets
0.4
4.1
4.3
5.5
11.6
Loss on divestiture of businesses
—
—
—
—
0.7
Loss on debt refinancing and
prepayment
—
—
—
—
13.3
Amortization of debt discount and issuance
costs
1.9
3.6
2.6
11.1
11.3
Share-based compensation
38.1
32.7
30.7
136.1
121.1
Non-cash asset impairment charges
22.1
—
6.8
37.8
19.5
Change in deferred tax balances
(7.5
)
(45.6
)
(18.7
)
(129.6
)
(127.7
)
Other
3.0
1.7
(6.2
)
10.0
(4.7
)
Changes in assets and liabilities
(24.7
)
(95.2
)
(132.0
)
(382.0
)
(862.7
)
Net cash provided by operating
activities
579.7
465.8
611.2
1,906.4
1,977.5
Cash flows from investing activities:
Payments for acquisition of property,
plant and equipment
(157.3
)
(161.7
)
(386.4
)
(694.0
)
(1,539.1
)
Proceeds from sale of property, plant and
equipment
5.6
0.3
1.2
6.2
4.0
Payments related to acquisition of
business
—
(20.5
)
—
(20.5
)
(236.3
)
Purchase of short-term investments
(300.0
)
(300.0
)
—
(1,050.0
)
—
Proceeds from maturity of short-term
investments and available-for-sale securities
300.0
450.0
—
750.0
33.5
Other
—
—
—
(1.5
)
—
Net cash used in investing activities
(151.7
)
(31.9
)
(385.2
)
(1,009.8
)
(1,737.9
)
Cash flows from financing activities:
Proceeds for the issuance of common stock
under the ESPP
5.6
6.5
5.9
25.2
25.8
Payment of tax withholding for RSUs
(2.7
)
(3.1
)
(4.4
)
(51.0
)
(66.8
)
Repurchase of common stock
(204.1
)
(200.0
)
(300.2
)
(654.1
)
(564.2
)
Issuance and borrowings under debt
agreements
—
—
—
—
1,845.0
Repayment of borrowings under debt
agreements
—
—
(119.6
)
—
(1,723.4
)
Payment on principal portion of finance
lease obligations
(0.4
)
(0.4
)
(5.0
)
(2.2
)
(15.3
)
Payment for purchase of bond hedges
—
—
—
—
(414.0
)
Proceeds from issuance of warrants
—
—
—
—
242.5
Other
(1.7
)
—
(8.9
)
(1.7
)
(16.1
)
Net cash used in financing activities
(203.3
)
(197.0
)
(432.2
)
(683.8
)
(686.5
)
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(3.7
)
2.4
0.4
(4.4
)
(1.1
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
221.0
239.3
(205.8
)
208.4
(448.0
)
Beginning cash, cash equivalents and
restricted cash
2,472.4
2,233.1
2,690.8
2,485.0
2,933.0
Ending cash, cash equivalents and
restricted cash
$
2,693.4
$
2,472.4
$
2,485.0
$
2,693.4
$
2,485.0
ON SEMICONDUCTOR
CORPORATION
RECONCILIATION OF GAAP VERSUS
NON-GAAP DISCLOSURES
(in millions, except per share
and percentage data)
Quarter Ended
Year Ended
December 31, 2024
September 27, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Reconciliation of GAAP to non-GAAP
gross profit:
GAAP gross profit
$
779.1
$
799.4
$
941.9
$
3,216.1
$
3,883.5
Special items:
a)
Impact of business wind down
—
—
—
—
(3.9
)
b)
Amortization of acquisition-related
intangible assets
1.6
1.6
1.5
6.3
5.7
Total special items
1.6
1.6
1.5
6.3
1.8
Non-GAAP gross profit
$
780.7
$
801.0
$
943.4
$
3,222.4
$
3,885.3
Reconciliation of GAAP to non-GAAP
gross margin:
GAAP gross margin
45.2
%
45.4
%
46.7
%
45.4
%
47.1
%
Special items:
a)
Impact of business wind down
—
%
—
%
—
%
—
%
—
%
b)
Amortization of acquisition-related
intangible assets
0.1
%
0.1
%
0.1
%
0.1
%
0.1
%
Total special items
0.1
%
0.1
%
0.1
%
0.1
%
—
%
Non-GAAP gross margin
45.3
%
45.5
%
46.7
%
45.5
%
47.1
%
Reconciliation of GAAP to non-GAAP
operating expenses:
GAAP operating expenses
$
370.5
$
354.0
$
329.8
$
1,448.4
$
1,344.8
Special items:
a)
Amortization of acquisition-related
intangible assets
(13.5
)
(13.0
)
(12.1
)
(52.0
)
(51.1
)
b)
Restructuring, asset impairments and
other, net
(30.9
)
(29.1
)
(11.4
)
(133.9
)
(74.9
)
c)
Third party acquisition and divestiture
related costs
(4.8
)
(7.4
)
0.1
(14.0
)
1.3
Total special items
(49.2
)
(49.5
)
(23.4
)
(199.9
)
(124.7
)
Non-GAAP operating expenses
$
321.3
$
304.5
$
306.4
$
1,248.5
$
1,220.1
Reconciliation of GAAP to non-GAAP
operating income:
GAAP operating income
$
408.6
$
445.4
$
612.1
$
1,767.7
$
2,538.7
Special items:
a)
Amortization of acquisition-related
intangible assets
15.1
14.6
13.6
58.3
56.8
b)
Restructuring, asset impairments and
other, net
30.9
29.1
11.4
133.9
74.9
c)
Third party acquisition and divestiture
related costs
4.8
7.4
(0.1
)
14.0
(1.3
)
d)
Impact of business wind down
—
—
—
—
(3.9
)
Total special items
50.8
51.1
24.9
206.2
126.5
Non-GAAP operating income
$
459.4
$
496.5
$
637.0
$
1,973.9
$
2,665.2
Reconciliation of GAAP to non-GAAP
operating margin (operating income / revenue):
GAAP operating margin
23.7
%
25.3
%
30.3
%
25.0
%
30.8
%
Special items:
a)
Amortization of acquisition-related
intangible assets
0.9
%
0.8
%
0.7
%
0.8
%
0.7
%
b)
Restructuring, asset impairments and
other, net
1.8
%
1.7
%
0.6
%
1.9
%
0.9
%
c)
Third party acquisition and divestiture
related costs
0.3
%
0.4
%
—
%
0.2
%
—
%
d)
Impact of business wind down
—
%
—
%
—
%
—
%
—
%
Total special items
3.0
%
2.9
%
1.2
%
2.9
%
1.5
%
Non-GAAP operating margin
26.7
%
28.2
%
31.6
%
27.9
%
32.3
%
Reconciliation of GAAP to non-GAAP
income before income taxes:
GAAP income before income taxes
$
442.5
$
454.6
$
610.9
$
1,837.4
$
2,535.8
Special items:
a)
Amortization of acquisition-related
intangible assets
15.1
14.6
13.6
58.3
56.8
b)
Restructuring, asset impairments and
other, net
30.9
29.1
11.4
133.9
74.9
c)
Third party acquisition and divestiture
related costs
4.8
7.4
(0.1
)
14.0
(1.3
)
d)
Impact of business wind down
—
—
—
—
(3.9
)
e)
Actuarial (gains) losses on pension plans
and other pension benefits
(12.2
)
—
4.0
(12.2
)
4.0
f)
Loss on debt refinancing and
prepayment
—
—
—
—
13.3
g)
Loss on divestiture of businesses
—
—
—
—
0.7
Total special items
38.6
51.1
28.9
194.0
144.5
Non-GAAP income before income taxes
$
481.1
$
505.7
$
639.8
$
2,031.4
$
2,680.3
Reconciliation of GAAP to non-GAAP net
income attributable to ON Semiconductor Corporation:
GAAP net income attributable to ON
Semiconductor Corporation
$
379.9
$
401.7
$
562.7
$
1,572.8
$
2,183.7
Special items:
a)
Amortization of acquisition-related
intangible assets
15.1
14.6
13.6
58.3
56.8
b)
Restructuring, asset impairments and
other, net
30.9
29.1
11.4
133.9
74.9
c)
Third party acquisition and divestiture
related costs
4.8
7.4
(0.1
)
14.0
(1.3
)
d)
Impact of business wind down
—
—
—
—
(3.9
)
e)
Actuarial (gains) losses on pension plans
and other pension benefits
(12.2
)
—
4.0
(12.2
)
4.0
f)
Loss on debt refinancing and
prepayment
—
—
—
—
13.3
g)
Loss on divestiture of businesses
—
—
—
—
0.7
h)
Income taxes
(14.3
)
(29.0
)
(50.7
)
(62.2
)
(72.0
)
Total special items
24.3
22.1
(21.8
)
131.8
72.5
Non-GAAP net income attributable to ON
Semiconductor Corporation
$
404.2
$
423.8
$
540.9
$
1,704.6
$
2,256.2
GAAP net income for diluted earnings per
share
$
379.9
$
401.7
$
562.8
$
1,572.8
$
2,185.0
Non-GAAP net income for diluted earnings
per share
$
404.2
$
423.8
$
541.0
$
1,704.6
$
2,257.5
Reconciliation of GAAP to non-GAAP
diluted shares outstanding:
GAAP diluted shares outstanding
429.6
431.7
439.5
432.7
446.8
Special items:
a)
Less: dilutive shares attributable to
convertible notes
(3.5
)
(4.1
)
(5.6
)
(4.0
)
(9.1
)
Total special items
(3.5
)
(4.1
)
(5.6
)
(4.0
)
(9.1
)
Non-GAAP diluted shares outstanding
426.1
427.6
433.9
428.7
437.7
Non-GAAP diluted earnings per
share:
Non-GAAP net income attributable to ON
Semiconductor Corporation
$
404.2
$
423.8
$
541.0
$
1,704.6
$
2,257.5
Non-GAAP diluted shares outstanding
426.1
427.6
433.9
428.7
437.7
Non-GAAP diluted earnings per share
$
0.95
$
0.99
$
1.25
$
3.98
$
5.16
Reconciliation of net cash provided by
operating activities to free cash flow:
Net cash provided by operating
activities
$
579.7
$
465.8
$
611.2
$
1,906.4
$
1,977.5
Special items:
a)
Payments for acquisition of property,
plant and equipment
(157.3
)
(161.7
)
(386.4
)
(694.0
)
(1,539.1
)
Total special items
(157.3
)
(161.7
)
(386.4
)
(694.0
)
(1,539.1
)
Free cash flow
$
422.4
$
304.1
$
224.8
$
1,212.4
$
438.4
Certain of the amounts in the above tables may not total due to
rounding of individual amounts.
ON SEMICONDUCTOR CORPORATION
RECONCILIATION OF GAAP VERSUS NON-GAAP DISCLOSURES
(Continued) (in millions, except per share and percentage
data)
FREE CASH FLOW
Quarter Ended
March 29, 2024
June 28, 2024
September 27, 2024
December 31, 2024
Last Twelve Months
Net cash provided by operating
activities
$
498.7
$
362.2
$
465.8
$
579.7
$
1,906.4
Payments for acquisition of property,
plant and equipment
(233.9
)
(141.1
)
(161.7
)
(157.3
)
(694.0
)
Free cash flow
$
264.8
$
221.1
$
304.1
$
422.4
$
1,212.4
Revenue
$
1,862.7
$
1,735.2
$
1,761.9
$
1,722.5
$
7,082.3
SHARE-BASED COMPENSATION
Total share-based compensation related to restricted stock
units, stock grant awards and the employee stock purchase plan was
as follows:
Quarter Ended
Year Ended
December 31, 2024
September 27, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Cost of revenue
$
6.5
$
6.2
$
4.7
$
24.6
$
18.1
Research and development
6.5
6.1
5.5
24.7
20.5
Selling and marketing
5.9
4.8
4.8
21.3
18.6
General and administrative
19.2
15.6
15.7
65.5
63.9
Total share-based compensation
$
38.1
$
32.7
$
30.7
$
136.1
$
121.1
SUPPLEMENTAL FINANCIAL DATA
Quarter Ended
Year Ended
December 31, 2024
September 27, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Net cash provided by operating
activities
$
579.7
$
465.8
$
611.2
$
1,906.4
$
1,977.5
Free cash flow
$
422.4
$
304.1
$
224.8
$
1,212.4
$
438.4
Cash paid for income taxes
$
53.4
$
49.2
$
100.8
$
347.5
$
428.2
Depreciation and amortization
$
166.6
$
161.8
$
160.3
$
642.9
$
609.5
Less: Amortization of acquisition-related
intangible assets
15.1
14.6
13.6
58.3
56.8
Depreciation and amortization (excl.
amortization of acquisition-related intangible assets)
$
151.5
$
147.2
$
146.7
$
584.6
$
552.7
NON-GAAP MEASURES
To supplement the consolidated financial results prepared in
accordance with GAAP, onsemi uses certain non-GAAP measures, which
are adjusted from the most directly comparable GAAP measures to
exclude items related to the amortization of acquisition-related
intangibles, expensing of appraised inventory fair market value
step-up, inventory valuation adjustments, in-process research and
development expenses, restructuring, asset impairments and other,
net, goodwill and intangible asset impairment charges, gains and
losses on debt prepayment, non-cash interest expense, actuarial
(gains) losses on pension plans and other pension benefits, third
party acquisition and divestiture-related costs, tax impact of
these items, and certain other non-recurring items, as necessary.
Management does not consider the effects of these items in
evaluating the core operational activities of onsemi. Management
uses these non-GAAP measures internally to make strategic
decisions, forecast future results, and evaluate onsemi’s current
performance. In addition, the Company believes that most analysts
covering onsemi use the non-GAAP measures to evaluate onsemi’s
performance. Given management’s and other relevant parties' use of
these non-GAAP measures, onsemi believes these measures are
important to investors in understanding onsemi’s current and future
operating results as seen through the eyes of management. In
addition, management believes these non-GAAP measures are useful to
investors in enabling them to better assess changes in onsemi's
core business across different time periods. These non-GAAP
measures are not prepared in accordance with, and should not be
considered alternatives or necessarily superior to, GAAP financial
data and may be different from non-GAAP measures used by other
companies. Because non-GAAP financial measures are not
standardized, it may not be possible to compare these financial
measures with other companies’ non-GAAP financial measures, even if
they have similar names.
Non-GAAP Revenue
The use of non-GAAP revenue allows management to evaluate, among
other things, the revenue from the Company’s core businesses and
trends across different reporting periods on a consistent basis,
independent of special items. In addition, non-GAAP revenue is an
important component of management’s internal performance
measurement and incentive and reward process as it is used to
assess the current and historical financial results of the business
and for strategic decision making, preparing budgets, obtaining
targets and forecasting future results. Management presents this
non-GAAP financial measure to enable investors and analysts to
evaluate the Company's revenue generation performance relative to
the direct costs of operations of onsemi's core businesses.
Non-GAAP Gross Profit and Gross Margin
The use of non-GAAP gross profit and gross margin allows
management to evaluate, among other things, the gross margin and
gross profit of the Company’s core businesses and trends across
different reporting periods on a consistent basis, independent of
non-cash items including, generally speaking, amortization of
acquisition-related intangible assets, expensing of appraised
inventory fair market value step-up, impact of business wind-down
and non-recurring facility costs. In addition, it is an important
component of management’s internal performance measurement and
incentive and reward process as it is used to assess the current
and historical financial results of the business and for strategic
decision making, preparing budgets, obtaining targets, and
forecasting future results. Management presents this non-GAAP
financial measure to enable investors and analysts to evaluate our
operating performance independent of certain non-cash items and the
effects of certain variables unrelated to our overall operating
performance.
Non-GAAP Operating Income and Operating Margin
The use of non-GAAP operating income and operating margin allows
management to evaluate, among other things, the operating margin
and operating income of the Company’s core businesses and trends
across different reporting periods on a consistent basis,
independent of non-cash items including, generally speaking,
expensing of appraised inventory fair market value step-up, impact
of business wind-down, non-recurring facility costs, amortization
and impairments of intangible assets, goodwill and intangible asset
impairment charges, third party acquisition and divestiture related
costs, restructuring charges and certain other special items as
necessary. In addition, it is an important component of
management’s internal performance measurement and incentive and
reward process as it is used to assess the current and historical
financial results of the business and for strategic decision
making, preparing budgets, obtaining targets, and forecasting
future results. Management presents this non-GAAP financial measure
to enable investors and analysts to evaluate our operating
performance independent of certain non-cash items and the effects
of certain variables unrelated to our overall operating
performance.
Non-GAAP Net Income Attributable to onsemi and Non-GAAP Diluted
Earnings Per Share
The use of non-GAAP net income attributable to onsemi and
non-GAAP diluted earnings per share allows management to evaluate
the operating results of onsemi’s core businesses and trends across
different reporting periods on a consistent basis, independent of
non-cash items including, generally, the amortization and
impairments of intangible assets, goodwill and intangible asset
impairment charges, expensing of appraised inventory fair market
value step-up, impact of business wind down, non-recurring facility
costs, restructuring, gains and losses on debt prepayment, non-cash
interest expense, actuarial (gains) losses on pension plans and
other pension benefits, third party acquisition and
divestiture-related costs, discrete tax items and other non-GAAP
tax adjustments and certain other special items, as necessary. In
addition, these items are important components of management’s
internal performance measurement and incentive and reward process,
as they are used to assess the current and historical financial
results of the business and for strategic decision making,
preparing budgets, setting targets, and forecasting future results.
Management presents these non-GAAP financial measures to enable
investors and analysts to understand the results of operations of
onsemi’s core businesses and, to the extent comparable, to compare
our results of operations on a more consistent basis against those
of other companies in our industry.
Free Cash Flow
The use of free cash flow allows management to evaluate, among
other things, the ability of the Company to make interest or
principal payments on its debt. Free cash flow is defined as the
difference between cash flow from operating activities and capital
expenditures disclosed under investing activities in the
consolidated statement of cash flows. Free cash flow is not an
alternative to cash flow from operating activities as a measure of
liquidity. It is an important component of management’s internal
performance measurement and incentive and reward process as it is
used to assess the current and historical financial results of the
business and for strategic decision making, preparing budgets,
obtaining targets, and forecasting future results. Management
presents this non-GAAP financial measure to enable investors and
analysts to evaluate our financial performance independent of the
cash capital expenditures.
Non-GAAP Diluted Share Count
The use of non-GAAP diluted share count allows management to
evaluate, among other things, the potential dilution due to the
outstanding restricted stock units excluding the dilution from the
convertible notes that is covered by hedging activity up to a
certain threshold. In periods when the quarterly average stock
price per share exceeds $52.97 for the 0% Notes and $103.87 for the
0.50% Notes, the non-GAAP diluted share count includes the
anti-dilutive impact of the Company’s hedge transactions issued
concurrently with the 0% Notes and the 0.50% Notes, respectively.
At an average stock price per share between $52.97 and $74.34 for
the 0% Notes and $103.87 and $156.78 for the 0.50% Notes, the
hedging activity offsets the potentially dilutive effect of the 0%
Notes and the 0.50% Notes, respectively. In periods when the
quarterly average stock price per share exceeds $74.34 for the 0%
Notes and $156.78 for the 0.50% Notes, the dilutive impact of the
warrants issued concurrently with such notes are included in the
diluted shares outstanding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250210128005/en/
Krystal Heaton Director, Head of Public Relations onsemi
(480) 242-6943 Krystal.Heaton@onsemi.com
Parag Agarwal Vice President - Investor Relations &
Corporate Development onsemi (602) 244-3437
investor@onsemi.com
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