Earnings results often give us a good indication of what direction the company will take in the months ahead. With Q3 now behind us, let’s have a look at ON Semiconductor (NASDAQ:ON) and its peers.
Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.
The 10 analog semiconductors stocks we track reported a decent Q3; on average, revenues beat analyst consensus estimates by 1.28%, while on average next quarter revenue guidance was 2.24% under consensus. Tech stocks have been under pressure as inflation makes their long-dated profits less valuable, but analog semiconductors stocks held their ground better than others, with the share prices up 12.7% since the previous earnings results, on average.
ON Semiconductor (NASDAQ:ON)
Spun out of Motorola in 1999, and built through a series of acquisitions, ON Semiconductor (NASDAQ: ON) is a global provider of analog chips with specialization in autos, industrial applications, and power management in cloud data centers.
ON Semiconductor reported revenues of $2.19 billion, up 25.8% year on year, beating analyst expectations by 3.57%. It was a very strong quarter for the company, with a significant improvement in gross margin and a beat on the bottom line.
“onsemi has delivered another quarter of record results stemming from continued growth in our focus markets of automotive and industrial. We remain confident in our long-term outlook as we continue to win where semiconductor content growth is accelerating for vehicle electrification, energy infrastructure, advanced safety and factory automation. We have taken a proactive and deliberate approach over the last several quarters to make the structural changes required to strengthen our business, and we are in a better position than ever to navigate the current uncertainty in the market,” said Hassane El-Khoury, president and CEO of onsemi.
ON Semiconductor pulled off the strongest analyst estimates beat of the whole group. The stock is down 3.78% since the results and currently trades at $64.86.
Is now the time to buy ON Semiconductor? Access our full analysis of the earnings results here, it's free.
Best Q3: Vishay Intertechnology (NYSE:VSH)
Named after the founder's ancestral village in present-day Lithuania, Vishay Intertechnology (NYSE:VSH) manufactures simple chips and electronic components that are building blocks of virtually all types of electronic devices.
Vishay Intertechnology reported revenues of $924.7 million, up 13.6% year on year, in line with analyst expectations. It was an impressive quarter for the company, with a significant improvement in gross margin and a beat on the bottom line.
Vishay Intertechnology had the weakest performance against analyst estimates among its peers. The stock is up 7.39% since the results and currently trades at $22.96.
Is now the time to buy Vishay Intertechnology? Access our full analysis of the earnings results here, it's free.
Weakest Q3: Texas Instruments (NASDAQ:TXN)
Headquartered in Dallas, Texas since the 1950s, Texas Instruments (NASDAQ: TXN) is the world’s largest producer of analog semiconductors.
Texas Instruments reported revenues of $5.24 billion, up 12.8% year on year, beating analyst expectations by 1.9%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter and an increase in inventory levels.
The stock is up 10.3% since the results and currently trades at $178.94.
Analog Devices (NASDAQ:ADI)
Founded by two MIT graduates, Ray Stata and Matthew Lorber in 1965, Analog Devices (NASDAQ:ADI) is one of the largest providers of high performance analog integrated circuits used mainly in industrial end markets, along with communications, autos, and consumer devices.
Analog Devices reported revenues of $3.24 billion, up 38.8% year on year, beating analyst expectations by 2.86%. It was a strong quarter for the company, with a significant improvement in operating margin.
The stock is up 5.49% since the results and currently trades at $168.00.
MACOM Technology (NASDAQ:MTSI)
Founded in the 1950s as Microwave Associates, a communications supplier to the US Army Signal Corp, today MACOM Technology Solutions (NASDAQ: MTSI) is a provider of analog chips used in optical, wireless, and satellite networks.
MACOM Technology reported revenues of $178.1 million, up 14.7% year on year, in line with analyst expectations. It was a solid quarter for the company, with a significant improvement in operating margin and revenue guidance for the next quarter above analysts' estimates.
The stock is up 11.6% since the results and currently trades at $64.17.
The author has no position in any of the stocks mentioned