ON Semiconductor Expects AI Data Center Revenue to Double in 2026 as Q2 Earnings Beat Estimates

Onsemi forecasts upbeat revenue on surging AI data center chip demand

Aug 3 (Reuters) - Chipmaker Onsemi (ON.O), opens new tab on Monday forecast third-quarter revenue above Wall Street expectations, betting on surging demand for power management chips used in AI data centers. Onsemi's results come as it looks to its biggest deal yet, a $7 billion all-stock acquisition of Synaptics announced in June, to tap into growing demand from AI devices and robotics. Here are some details: Reporting by Nithyashree R B in Bengaluru; Editing by Shreya Biswas Our Standards: The Thomson Reuters Trust Principles., opens new tab

ON Semiconductor Q2 2026 earnings beat on AI data center growth

Revenue climbed 9% from the year-ago quarter to $1.6 billion, edging past the $1.59 billion that FactSet-polled analysts had projected, according to the Journal. President and CEO Hassane El-Khoury said in a statement that the company delivered revenue, gross margin, and earnings per share above the midpoint of guidance. "AI data center remains our fastest-growing business, and we now expect revenue to more than double in 2026, demonstrating the strength of our intelligent power portfolio and growing customer adoption across the power tree," he said.

ON Semiconductor Prioritizes Data Centers Ahead Of Cars - ON Semiconductor (NASDAQ:ON)

ON Semiconductor's CEO Says AI Demand Got Priority Over Automotive Customers -- and Wall Street Loved It as Stock Jumps 7% in Premarket Tuesday AI Demand Took Priority Over Automotive During the company's second-quarter earnings call, CEO Hassane El-Khoury said the company shifted capacity toward AI data center customers after demand accelerated faster than expected, temporarily diverting supply from its automotive and industrial businesses while manufacturing catches up. "We did prioritize AI data center that took away from our other businesses in the short term," El-Khoury said, adding that the move reflected long-term opportunities rather than a one-quarter spike in demand. The company expects AI data center revenue to more than double this year. The AI infrastructure boom has created a new wave of demand beyond graphics processors, with hyperscalers investing heavily in the power systems needed to run increasingly energy-intensive data centers. Power Infrastructure Is Becoming AI's Next Growth Engine El-Khoury said ON Semiconductor's opportunity extends beyond supplying chips inside data centers, with AI deployments driving demand across the broader power infrastructure needed to support them. He added that the company is benefiting from what it calls the "AI halo effect," with demand increasing for products used in energy storage systems, battery backup, power conversion, and high-voltage infrastructure. ON Semiconductor also expects energy storage revenue to grow about 40% this year as AI power requirements continue to expand. Results Beat Estimates, Guidance Tops Expectations Revenue rose to $1.6 billion from $1.47 billion a year earlier, topping the consensus estimate of $1.59 billion. For the third quarter, the company guided for revenue of $1.65 billion to $1.75 billion and adjusted earnings of 79 cents to 91 cents per share. Wall Street expects revenue of $1.66 billion and adjusted earnings per share of 83 cents. Price Action: The stock closed 5.78% higher on Tuesday at $80.40 and gained a further 7.38% in extended trading on the earnings announcement. In pre-market trading on Tuesday, ON was up over 7%. Benzinga edge rankings indicate ON has a Momentum score in the 84th percentile and a Growth score in the 83rd percentile. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

On Semi Reports Q2 Earnings, Expects 2x AI Data Center Revenue in 2026 - ON Semiconductor (NASDAQ:ON)

Here's a look at the details inside the report. * ON stock is moving. Watch the price action here. On Semiconductor Q2 Details On Semi reported quarterly earnings of 74 cents per share, which beat the Street estimate of 71 cents, according to Benzinga Pro data. Quarterly revenue of $1.6 billion, which beat the analyst consensus estimate of $1.59 billion and was up from $1.47 billion in the same period last year. Non-GAAP gross margin was 39.3% and non-GAAP operating margin was 20.8% for the quarter. "We delivered revenue, gross margin and earnings per share above the midpoint of guidance, reflecting strengthening demand, particularly across AI-driven applications, and growing customer adoption of our differentiated solutions, including Treo and our high voltage power solutions," said Hassane El-Khoury, CEO. "AI data center remains our fastest-growing business, and we now expect revenue to more than double in 2026, demonstrating the strength of our intelligent power portfolio and growing customer adoption across the power tree," El-Khoury added. ON Stock Price Activity: According to data from Benzinga Pro, On Semiconductor stock was up 5.35% to $84.70 in Monday's extended trading. Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

ON Semiconductor hits the accelerator on AI, shares gain 4%

The momentum has mainly been driven by the Power Solutions Group, where sales rose 19%, notably helped by power-management components for data centers. The company now expects more than a doubling of its AI-related revenue in 2026, supported by its growing integration into the NVIDIA MGX ecosystem and new contracts for its EliteSiC solutions, its MOSFETs and its controllers. The recent launch of the GaNEXUS line also broadens its offering in gallium nitride, a technology suited to the rising power needs of digital infrastructure. Cash generation is another bright spot, with FCF quadrupling to $425m. For Q3, ON Semiconductor is targeting revenue of between $1.65bn and $1.75bn and adjusted EPS of between $0.81 and $0.93. The recovery remains uneven, however, as the automotive business slipped slightly sequentially and the analog segment is still below last year's level.