ON Semiconductor Corporation reported a significant decline in financial performance for the first quarter of 2025, with revenues totaling $1.45 billion, down 22% from $1.86 billion in the same quarter of the previous year. The company's net loss for the quarter was $486.1 million, compared to a net income of $453 million in the prior year. This downturn was attributed to decreased demand in key markets, particularly in the automotive and industrial sectors, which impacted sales across all product segments.
The company's operating expenses surged to $867.5 million, a substantial increase from $328.4 million in the previous year, primarily due to restructuring and asset impairment charges totaling $539.3 million. This included $431.5 million in non-cash impairment charges related to manufacturing equipment, as part of a broader 2025 Manufacturing Realignment Program aimed at optimizing operational efficiency. The restructuring plan also involved a workforce reduction of approximately 2,400 employees, incurring severance costs of about $63 million.
In terms of operational metrics, ON Semiconductor's Power Solutions Group (PSG) saw a revenue decline of 26%, while the Analog and Mixed-Signal Group (AMG) and Intelligent Sensing Group (ISG) reported decreases of 19% and 20%, respectively. The company also recorded excess and obsolete inventory charges of $237.7 million, primarily affecting the ISG segment. Geographically, revenue from Hong Kong, Singapore, the United Kingdom, and the United States all experienced declines, reflecting the broader market challenges.
Despite these challenges, ON Semiconductor maintained a strong liquidity position, with cash and cash equivalents of approximately $2.76 billion as of April 4, 2025. The company also continued its share repurchase program, buying back 6.1 million shares for $302.6 million during the quarter. Looking ahead, ON Semiconductor aims to navigate the current market conditions by focusing on operational efficiencies and capitalizing on growth opportunities in high-demand sectors, particularly in automotive and industrial applications. The company expects to recognize approximately 31% of its remaining performance obligations, valued at $10.6 billion, as revenue over the next 12 months, contingent on market conditions and customer demand.
About ON SEMICONDUCTOR CORP
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