Q3 FY2026
Filed Nov 2, 2026onsemi Reports Third Quarter 2026 Results Earnings growth outpaces revenue growth by 4x year-over-year
Revenue increased 11% year-over-year, GAAP diluted earnings per share was $0.79, non-GAAP diluted earnings per share was $0.90, and free cash flow grew 31% year-over-year to $488.6 million. The Company said revenue, gross margin and earnings per share exceeded the midpoint of its guidance.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 revenueGAAP | $1.72B | 7% | 11% |
| Q3 2026 gross profitGAAP | $713M | – | – |
| Q3 2026 gross marginGAAP | 41.4% | 190 basis points | – |
| Q3 2026 non-GAAP gross profitnon-GAAP | $709.3M | – | – |
| Q3 2026 non-GAAP gross marginnon-GAAP | 41.2% | – | – |
| Q3 2026 total operating expensesGAAP | $334.7M | – | – |
| Q3 2026 non-GAAP operating expensesnon-GAAP | $309.5M | – | – |
| Q3 2026 operating incomeGAAP | $378.3M | – | – |
| Q3 2026 operating marginGAAP | 22.0% | – | – |
| Q3 2026 non-GAAP operating incomenon-GAAP | $399.8M | – | – |
| Q3 2026 non-GAAP operating marginnon-GAAP | 23.2% | – | – |
| Q3 2026 net income attributable to ON Semiconductor CorporationGAAP | $313.9M | – | – |
| Q3 2026 non-GAAP net income attributable to ON Semiconductor Corporationnon-GAAP | $354M | – | – |
| Q3 2026 diluted earnings per shareGAAP | $0.79 | – | – |
| Q3 2026 non-GAAP diluted earnings per sharenon-GAAP | $0.90 | – | more than 40% |
| Q3 2026 net cash provided by operating activitiesGAAP | $516.4M | – | 23% |
| Q3 2026 free cash flownon-GAAP | $488.6M | – | 31% |
| Q3 2026 free cash flow as a percentage of revenuenon-GAAP | 28% of revenue | – | – |
| Nine months ended October 2, 2026 revenueGAAP | $4.84B | – | – |
| Nine months ended October 2, 2026 gross marginGAAP | 39.5% | – | – |
| Nine months ended October 2, 2026 operating incomeGAAP | $583.5M | – | – |
| Nine months ended October 2, 2026 net income attributable to ON Semiconductor CorporationGAAP | $507.3M | – | – |
| Nine months ended October 2, 2026 diluted earnings per shareGAAP | $1.27 | – | – |
| Nine months ended October 2, 2026 non-GAAP diluted earnings per sharenon-GAAP | $2.28 | – | – |
| Nine months ended October 2, 2026 net cash provided by operating activitiesGAAP | $1.22B | – | – |
| Nine months ended October 2, 2026 free cash flownon-GAAP | $1.13B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| PSGNo segment-specific revenue driver was provided. | $889.9M | 7% | 21% |
| AMGNo segment-specific revenue driver was provided. | $597.3M | 9% | 2% |
| ISGNo segment-specific revenue driver was provided. | $235.1M | 3% | 2% |
Amounts quoted below without a unit are in millions, as in the filing’s tables. Per-share figures are as printed.
Fourth quarter 2026 outlook
- Revenue$1,715 to $1,815 million
- Gross marginGAAP: 41.4% to 43.4%; non-GAAP: 41.5% to 43.5%
- Operating expensesGAAP: $331 to $346 million; non-GAAP: $303 to $318 million
- NoteOther Income and Expense (including interest), net: ($27 million)
- NoteGAAP diluted earnings per share: $0.88 to $1.00
- NoteNon-GAAP diluted earnings per share: $0.95 to $1.07
- NoteGAAP diluted shares outstanding: 397 million
- NoteNon-GAAP diluted shares outstanding: 392 million
- NoteGAAP special items: 0.1% for gross margin; $29 million for operating expenses; $0.07 for diluted earnings per share; 5 million diluted shares outstanding
Capital returns
- Repurchase of common stock: $(19.9) million for the quarter ended October 2, 2026
- Repurchase of common stock: $(710.4) million for the nine months ended October 2, 2026
What drove it
- Increasing power requirements are driving accelerated demand in AI data center and industrial end markets, as customers adopt and ramp differentiated products.
- AI data center revenue grew 39% sequentially and 175% year-over-year.
- PSG revenue was $889.9 million, up 21% year-over-year.
- Gross margin expanded for the fifth consecutive quarter, increasing 190 basis points sequentially.
- The Company announced an agreement to acquire Ferric and raised its AI data center 2030 revenue target by $500 million to greater than $3 billion.
- The Company announced revised terms for the planned acquisition of Synaptics, for approximately $5.7 billion in cash compared to $7 billion in stock for the prior agreement.
Concerns
- AMG revenue increased 2% year-over-year to $597.3 million.
- ISG revenue increased 2% year-over-year to $235.1 million.
- Long-term debt was $3,660.2 million and the current portion of long-term debt was $802.8 million as of October 2, 2026.
- The planned acquisition of Synaptics is for approximately $5.7 billion in cash.
- Fourth-quarter GAAP diluted earnings per share outlook is $0.88 to $1.00.
What to watch
- Execution against fourth-quarter 2026 revenue outlook of $1,715 to $1,815 million.
- Fourth-quarter 2026 GAAP gross margin outlook of 41.4% to 43.4% and non-GAAP gross margin outlook of 41.5% to 43.5%.
- Whether AI data center revenue continues to grow following reported sequential growth of 39% and year-over-year growth of 175%.
- Progress on fab right initiatives and the ramp of new differentiated products.
- The planned Ferric and Synaptics acquisitions and their stated strategic and non-GAAP EPS implications.
Balance sheet and cash flow
- Cash and cash equivalents: $4,157.7 million as of October 2, 2026
- Short-term investments: $210.0 million as of October 2, 2026
- Current portion of long-term debt: $802.8 million as of October 2, 2026
- Long-term debt: $3,660.2 million as of October 2, 2026
- Inventories: $2,069.7 million as of October 2, 2026
- Accounts receivable, net: $917.4 million as of October 2, 2026
- Payments for acquisition of property, plant, and equipment: $(27.8) million for the quarter ended October 2, 2026
- Ending cash, cash equivalents and restricted cash: $4,159.1 million for the quarter ended October 2, 2026
- Last twelve months free cash flow: $1,616.6 million
Analysis
onsemi reported Q3 2026 revenue of $1,722.3 million, up 11% year-over-year and 7% sequentially. PSG was the principal reported segment growth contributor, with revenue of $889.9 million, up 21% year-over-year. AMG and ISG each grew 2% year-over-year, to $597.3 million and $235.1 million, respectively. Management attributed demand to rising power requirements in AI data center and industrial end markets and said AI data center revenue grew 39% sequentially and 175% year-over-year.
Profitability improved materially. GAAP gross margin was 41.4%, versus 38.4% in Q2 2026 and 37.9% in Q3 2025, while non-GAAP gross margin was 41.2%. GAAP operating margin was 22.0%, compared with 16.1% in Q2 2026 and 17.0% in Q3 2025. Non-GAAP operating margin reached 23.2%. The Company said gross margin expanded for the fifth consecutive quarter by 190 basis points sequentially, citing operating leverage, fab right initiatives and new differentiated-product ramps.
GAAP net income attributable to ON Semiconductor Corporation was $313.9 million and GAAP diluted earnings per share was $0.79. Non-GAAP net income attributable to ON Semiconductor Corporation was $354.0 million and non-GAAP diluted earnings per share was $0.90, with management stating that earnings per share grew more than 40% year-over-year. Cash generation also advanced: net cash provided by operating activities was $516.4 million and free cash flow was $488.6 million, representing 28% of revenue. The Company repurchased $19.9 million of common stock during the quarter.
The balance sheet ended the quarter with $4,157.7 million of cash and cash equivalents and $210.0 million of short-term investments. Long-term debt was $3,660.2 million and the current portion of long-term debt was $802.8 million. The Company also outlined strategic activity including an agreement to acquire Ferric, which raised its AI data center 2030 revenue target by $500 million to greater than $3 billion, and revised Synaptics acquisition terms for approximately $5.7 billion in cash.
For Q4 2026, onsemi guided revenue to $1,715 to $1,815 million, GAAP gross margin to 41.4% to 43.4%, and non-GAAP gross margin to 41.5% to 43.5%. GAAP diluted earnings per share is projected at $0.88 to $1.00, while non-GAAP diluted earnings per share is projected at $0.95 to $1.07. The guide maintains margins around Q3 levels while revenue guidance spans a range around the Q3 revenue result.
Management, verbatim
Increasing power requirements are driving accelerated demand in our AI data center and industrial end markets, as customers adopt and ramp our differentiated products.
Hassane El-Khoury, President and CEO of onsemi
Our third quarter revenue, gross margin and earnings per share exceeded the midpoint of our guidance, while AI data center revenue grew 39% sequentially and 175% year-over-year.
Hassane El-Khoury, President and CEO of onsemi
Gross margin expanded for the fifth consecutive quarter, increasing 190 basis points sequentially. Our results continue to demonstrate the operating leverage in our model, with earnings per share growing more than 40% year-over-year on 11% revenue growth.
Thad Trent, EVP and CFO of onsemi
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so comparison of reported results with prior guidance is unavailable.
- Fourth-quarter 2026 tax-rate guidance was not provided.
- Dividend declaration or dividend payment information was not provided.
- Segment-specific revenue drivers for PSG, AMG and ISG were not provided.
- Year-over-year and sequential percentage changes were not printed for most income-statement line items beyond revenue, segment revenue, cash from operations, free cash flow, AI data center revenue and the stated gross-margin expansion.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.