How Weaker 2025 Results, New Guidance and Buybacks At ON Semiconductor (ON) Have Changed Its Investment Story

Simply Wall St

Mon, February 23, 2026 at 4:09 PM GMT+9 3 min read

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In February 2026, ON Semiconductor reported that fourth-quarter 2025 sales fell to US$1,530.1 million and net income to US$181.8 million, while full-year 2025 sales declined to US$5.99 billion and net income to US$121 million, alongside new first-quarter 2026 guidance and ongoing share repurchases under its multi-year buyback programs.

Despite weaker recent results, management highlighted signs of market stabilization, sequential growth in automotive and industrial sales, and continued investment in intelligent power and AI data center technologies, all supported by strong cash generation and sizeable share buybacks reducing the share count by more than 10% since early 2023.

Now we’ll explore how guidance pointing to an inflection in automotive and industrial demand could reshape ON Semiconductor’s existing investment narrative.

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ON Semiconductor Investment Narrative Recap

To own ON Semiconductor, you need to believe its focus on intelligent power, EVs, industrial and AI data center chips can offset cyclicality in autos and factory spending. The latest results confirm weaker earnings, but management’s comments about stabilizing demand and sequential auto and industrial growth keep the near term demand inflection as the key catalyst. The biggest risk remains that any recovery is slower or patchier than hoped, especially in autos and China exposure.

The most relevant update here is ON’s new first quarter 2026 guidance for revenue of US$1,435 million to US$1,535 million and diluted EPS of US$0.28 to US$0.38. This range sets a near term bar for whether the hinted recovery in automotive and industrial demand is actually gaining traction, or if current strength in areas like AI data center power is still not enough to fully offset ongoing softness and portfolio exits.

But against this potential recovery, investors should also be aware that…

Read the full narrative on ON Semiconductor (it’s free!)

ON Semiconductor’s narrative projects $7.5 billion revenue and $1.9 billion earnings by 2028. This requires 5.4% yearly revenue growth and a roughly $1.4 billion earnings increase from $465.8 million today.

Uncover how ON Semiconductor’s forecasts yield a $63.00 fair value, a 9% downside to its current price.

Exploring Other Perspectives

ON 1-Year Stock Price Chart

Some of the most optimistic analysts were expecting revenue near US$7.9 billion and earnings of about US$2.6 billion by 2028, which is a much stronger trajectory than consensus and assumes execution on technologies like silicon carbide without major setbacks, so after this earnings reset you may find your own view sits somewhere between these bullish hopes and the more cautious concerns around underutilization and auto cyclicality.

Story continues  

Explore 11 other fair value estimates on ON Semiconductor - why the stock might be worth as much as 7% more than the current price!

Form Your Own Verdict

Don’t just follow the ticker - dig into the data and build a conviction that’s truly your own.

A great starting point for your ON Semiconductor research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.

Our free ON Semiconductor research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate ON Semiconductor's overall financial health at a glance.

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_ This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._

Companies discussed in this article include ON.

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