ON Semiconductor's fourth-quarter results beat expectations and announced a $3 billion stock repurchase plan
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ON Semiconductor ( onsemi , U.S. Nasdaq stock code: ON) announced its fourth quarter and full-year results for 2022. The highlights are as follows:
Fourth quarter revenue was US$2.1036 billion, a year-on-year increase of 14%
In the fourth quarter, the generally accepted accounting principles (hereinafter referred to as "GAAP") gross profit margin was 48.5%, a year-on-year increase of 343 basis points, and the non-GAAP gross profit margin was 48.4%, a year-on-year increase of 321 basis points.
Record-breaking automotive industry revenue in Q4 reached $989 million, up 54% year-over-year
Fourth quarter GAAP and non-GAAP diluted earnings per share were $1.35 and $1.32, respectively.
Record-breaking full-year revenue of US$8.3 billion in fiscal 2022, a year-on-year increase of 24%
GAAP and non-GAAP gross profit margins in 2022 will be 49.0% and 49.2% respectively.
Free cash flow in fiscal 2022 increased 22% year-over-year and accounted for 20% of revenue
ON Semiconductor
President and Chief Executive Officer (CEO) Hassane El-Khoury
said:
The high level of execution and strategic transformation throughout the company ensures that we will achieve outstanding results in 2022. Full-year 2022 revenue increased 24% year over year, non-GAAP gross margin increased 880 basis points, and non-GAAP operating income grew four times faster than revenue due to our focus on electric vehicles, advanced driver assistance systems (ADAS) , alternative energy and industrial automation. We are committed to key strategic initiatives such as increasing silicon carbide production to support long-term supply agreements. Despite the current macroeconomic uncertainty, the long-term outlook for our business remains strong, with our total design imports growing 38% year over year.
ON Semiconductor also announced that its board of directors has approved a new stock repurchase plan authorizing the repurchase of up to $3 billion of the company's common stock by December 31, 2025.
ON Semiconductor executive vice president and chief financial officer Thad Trent said:
We are committed to driving a balanced capital allocation strategy that delivers long-term value to shareholders. The Board of Directors and leadership team are confident in our investment strategy for long-term profitable growth and are pleased to announce a new $3 billion share repurchase authorization. Since we began our transformation journey, free cash flow has tripled, so our repurchase authorization is twice the previous authorization (expiration December 31, 2022), increasing flexibility.
Under the new stock repurchase program, ON Semiconductor may repurchase shares at any time through open market purchases, privately negotiated transactions or other means, including using a trading plan consistent with Rule 10b5-1 of the Securities Exchange Act of 1934, in accordance with applicable securities laws and other Restrictions revised. The timing and amount of share repurchases will depend on business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices and other considerations. The authorization expires on December 31, 2025, may be suspended or terminated at any time, and does not require the Company to acquire any number of shares of common stock.
The following table summarizes selected financial results for the fourth quarter of 2022 and comparable periods:
The following table summarizes 2022 and 2021 financial results:
The following table summarizes ON Semiconductor's expected GAAP and non-GAAP outlook for the first quarter of 2023:
ON Semiconductor has held a conference call for the financial community at 9:00 a.m. Eastern Time (EST) on February 6, 2023, to discuss this announcement and ON Semiconductor's 2022 fourth quarter and full-year results. The English conference call has been broadcast in real time on the "Investor Relations" page of the company's website http://www.onsemi.cn, and the real-time broadcast playback will last for 30 days.
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