ON Set to Report Q1 Earnings: What's in Store for the Stock?

Core Viewpoint - On Semiconductor (ON) is expected to report a significant decline in revenues and earnings for the first quarter of 2025, influenced by various market challenges, particularly in the automotive sector [1][3][4]. Revenue and Earnings Expectations - ON anticipates revenues between $1.35 billion and $1.45 billion for Q1 2025, with earnings projected to be in the range of 45-55 cents per share [1]. - The Zacks Consensus Estimate for revenues is set at $1.41 billion, indicating a decline of 12.56% from the previous year's figure [2]. Performance Influencing Factors - The company's performance is likely to be impacted by volatility in the automotive sector, geopolitical uncertainties, supply-chain disruptions, and a slower-than-expected adoption rate of electric vehicles (EVs) [3]. - A significant decline in automotive revenues is anticipated, with a sequential drop of 25% or more, primarily due to weakening demand in China [4]. - Industrial revenues also faced a decline of 5% sequentially in the previous quarter, attributed to inventory digestion and weakness in traditional markets [5]. Strategic Focus - ON's emphasis on silicon carbide (SiC) technology is a key growth driver, with expectations for revenue growth in SiC JFET and SiC MOSFET products through 2025 [6]. - The recent acquisition of Qorvo's SiC JFET business is expected to enhance ON's strategy in providing comprehensive power solutions across various markets [6]. Earnings Prediction Model - The Zacks model indicates that ON currently has an Earnings ESP of 0.00% and a Zacks Rank of 5 (Strong Sell), suggesting low odds of an earnings beat [7].