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What changed in ON Semiconductor's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ON Semiconductor's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+337 added−298 removedSource: 10-K (2026-02-09) vs 10-K (2025-02-10)

Top changes in ON Semiconductor's 2025 10-K

337 paragraphs added · 298 removed · 251 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

61 edited+27 added−29 removed41 unchanged
Biggest changeOur product development efforts are directed towards the following: • addressing the need for solutions to manage and optimize the growing power demands and distribution within AI data centers; • powering the electrification of the automotive industry with our intelligent power technologies that allow for lighter and longer-range electric vehicles and enable efficient fast-charging systems; • propelling the sustainable energy evolution with our intelligent power technologies for the highest efficiency solar strings, industrial power and storage systems; • enhancing the automotive mobility experience with our intelligent sensing technologies with imaging and depth sensing that make advanced vehicle safety and automated driving systems possible; and • enabling automation and data exchange (Industry 4.0) with our intelligent sensing technologies for smarter factories and buildings. 8 Table of Contents While our new product development efforts continue to be focused on building solutions in areas that appeal to customers in focused market segments and across multiple high-growth applications, it is our practice to regularly re-evaluate our research and development spending, to assess the deployment of resources and to review the funding of high-growth technologies.
Biggest changeOur product development efforts are directed towards the following: • addressing the need for solutions to manage and optimize the growing power demands and distribution within AI data centers; • powering the electrification of the automotive industry with our intelligent power technologies that allow for lighter and longer-range electric vehicles and enable efficient fast-charging systems; • propelling the sustainable energy evolution with our intelligent power technologies for the highest efficiency solar strings, industrial power and storage systems; • enhancing the automotive mobility experience with our intelligent sensing technologies with imaging and depth sensing that make AD, ADAS, and advanced vehicle safety possible; and • enabling robotics, humanoids, automation, and data exchange (Industry 4.0) with our intelligent sensing technologies for smarter factories and buildings.
El-Khoury currently serves as Chairman of the board of directors of Leia Inc. He holds a Bachelor of Science in electrical engineering from Lawrence Technological University and a Master's of Engineering Management from Oakland University. Thad Trent . Mr. Trent was appointed Executive Vice President, Chief Financial Officer and Treasurer of onsemi in February 2021. Mr.
El-Khoury currently serves as Chairman of the board of directors of Leia Inc. He holds a Bachelor of Science in electrical engineering from Lawrence Technological University and a Master's of Engineering Management from Oakland University. Thad Trent . Mr. Trent was appointed Executive Vice President and Chief Financial Officer of onsemi in February 2021. Mr.
He first joined Cypress in 2005, and served as Cypress CFO from June 2014 until its sale to Infineon in April 2020. Under his leadership, Cypress’ revenue increased from $723 million to $2.5 billion, and the enterprise value increased five times during his five-year tenure as Cypress CFO.
He first joined Cypress in 2005 and served as Cypress CFO from June 2014 until its sale to Infineon in April 2020. Under his leadership, Cypress’ revenue increased from $723 million to $2.5 billion, and the enterprise value increased five times during his tenure as Cypress CFO.
He earned his Bachelor of Science in business administration and finance at San Diego State University. 14 Simon Keeton . Mr. Keeton joined onsemi in July 2007 and is currently the Group President, PSG of onsemi. During his career, Mr. Keeton has held various management positions within onsemi. Before Mr.
He earned his Bachelor of Science in business administration and finance at San Diego State University. Simon Keeton . Mr. Keeton joined onsemi in July 2007 and is currently the Group President, PSG of onsemi. During his career, Mr. Keeton has held various management positions within onsemi. Before Mr.
He earned a Bachelor of Science degree in computer engineering and a Master of Science Degree in electrical engineering from Michigan State University, and a Master of Business Adminis tration from Pepperdine University – in addition to completing an executive business program from Harvard Business School. Sudhir Gopalswamy . Mr.
He earned a Bachelor of Science degree in computer 15 engineering and a Master of Science Degree in electrical engineering from Michigan State University, and a Master of Business Adminis tration from Pepperdine University – in addition to completing an executive business program from Harvard Business School. Sudhir Gopalswamy . Mr.
Our competitive position with respect to the above is enhanced by long-standing relationships with leading direct customers. Our ability to compete successfully depends on internal and external variables.
Our competitive position with respect to the above is enhanced by long-standing relationships with leading customers. Our ability to compete successfully depends on internal and external variables.
The costs we incurred in complying with applicable environmental regulations for the year ended December 31, 2024 were not material, and we do not currently expect the cost of complying with existing environmental and health and safety laws and regulations, together with any liabilities for currently known environmental conditions, to have a material adverse effect on our capital expenditures or earnings or on our competitive position in any one year.
The costs we incurred in complying with applicable environmental regulations for the year ended December 31, 2025 were not material, and we do not currently expect the cost of complying with existing environmental and health and safety laws and regulations, together with any liabilities for currently known environmental conditions, to have a material adverse effect on our capital expenditures or earnings or on our competitive position in any one year.
The costs we incurred in complying with applicable trade regulations for the year ended December 31, 2024 were not material, and we do not currently expect the cost of complying with existing trade laws and regulations to have a material adverse effect on our capital expenditures or earnings or on our competitive position in any one year.
The costs we incurred in complying with applicable trade regulations for the year ended December 31, 2025 were not material, and we do not currently expect the cost of complying with existing trade laws and regulations to have a material adverse effect on our capital expenditures or earnings or on our competitive position in any one year.
Information on or accessible through our website is neither part of, nor incorporated by reference into, this Form 10-K or any other report filed with or furnished to the SEC. You can also find these materials on the SEC website at www.sec.gov . 15
Information on or accessible through our website is neither part of, nor incorporated by reference into, this Form 10-K or any other report filed with or furnished to the SEC. You can also find these materials on the SEC website at www.sec.gov . 16
Export Administration Act. Additionally, United States and foreign governmental authorities have taken, and may continue to take, administrative, legislative or regulatory action that 12 Table of Contents could impact our operations. We believe that our operations are in material compliance with applicable trade regulations relating to import-export control, technology transfer restrictions, ITAR, FCPA, the anti-boycott provisions of the U.S.
Export Administration Act. Additionally, United States and foreign governmental authorities have taken, and may continue to take, administrative, legislative or regulatory action that could impact our operations. We believe that our operations are in material compliance with applicable trade regulations relating to import-export control, technology transfer restrictions, ITAR, FCPA, the anti-boycott provisions of the U.S.
We deploy people and capital with the goal of maximizing the return for our research and development investments by targeting innovative products and solutions for high-growth applications that we believe position us to outperform the industry. End-Markets We serve a broad base of end-user markets, with a primary focus towards automotive and industrial.
We deploy people and capital with the goal of maximizing the return for our research and development investments by targeting innovative products and solutions for high-growth applications that we believe position us to outperform the industry. 9 Table of Contents End-Markets We serve a broad base of end-user markets, with a primary focus towards automotive and industrial.
Patents, Trademarks, Copyrights and Other Intellectual Property Rights We market our products under worldwide trademarks, including the ON Semiconductor, ON, onsemi, and various product names and logos, and, in the United States and internationally, we rely primarily on a combination of patents, trademarks, copyrights, trade secrets, employee and non-disclosure agreements and licensing agreements to protect our IP.
Patents, Trademarks, Copyrights and Other Intellectual Property Rights We market our products under worldwide trademarks, including ON Semiconductor, ON, onsemi, and various product names and logos, and, in the United States and internationally, we rely primarily on a combination of patents, trademarks, copyrights, 12 Table of Contents trade secrets, employee and non-disclosure agreements and licensing agreements to protect our IP.
Trent has held several leadership roles throughout his career, and he currently serves on the board of directors of Leia Inc. He previously served as Chief Financial Officer at Cypress ("Cypress CFO") responsible for strategic planning, accounting, investor relations, tax, corporate development and information technology.
Trent has held several leadership roles throughout his career, and he currently serves on the board of directors of Lumentum Holdings Inc. as well as the board of Leia Inc. He previously served as Chief Financial Officer at Cypress ("Cypress CFO") responsible for strategic planning, accounting, investor relations, tax, corporate development and information technology.
Our standard warranty extends for a period of two years from the date of delivery, except in the case of image sensor products, which are warrantied for one year from the date of delivery.
Our standard warranty extends for a period of two years from the date of delivery, except in the case of image sensor products, which are warranted for one year from the date of delivery.
AMG AMG principally competes on design experience, manufacturing capability, depth and quality of IP, ability to service customer needs from the design phase to the shipping of a completed product, length of design cycle, longevity of technology support and experience of sales and technical support personnel.
AMG AMG principally competes on design experience, manufacturing capability, depth and quality of IP, ability to service customer needs from the design phase to the shipping of a completed product, length of design cycle, longevity of technology support and 10 Table of Contents experience of sales and technical support personnel.
Unless otherwise agreed in writing, customers may cancel orders 120 days prior to shipment for standard products without penalty and, for custom products, prior to shipment, provided they pay onsemi's actual costs incurred as of the date we receive the cancellation notice.
Unless otherwise agreed in writing, customers may cancel orders 45-120 days prior to shipment, depending on the product, for standard products without penalty and, for custom products, prior to shipment, provided they pay onsemi's actual costs incurred as of the date we receive the cancellation notice.
Our agreements with these contract manufacturers typically require us to forecast product needs and commit to purchase services consistent with these forecasts. In some cases, longer-term commitments are required in the early stages of the relationship. These manufacturers collectively accounted for approximately 33% of our total manufacturing input costs in 2024, 36% in 2023 and 43% in 2022.
Our agreements with these manufacturers typically require us to forecast product needs and commit to purchase services consistent with these forecasts. In some cases, longer-term commitments are required in the early stages of the relationship. These manufacturers collectively accounted for approximately 34% of our total manufacturing input costs in 2025, 33% in 2024 and 36% in 2023.
The loss of one of our large customers would have a material adverse effect on the operations of the respective segment and may have a material adverse effect on our consolidated results of operations. Distributors Sales to distributors accounted for approximately 53%, 52% and 58% of our revenue in 2024, 2023 and 2022, respectively.
The loss of one of our large customers would have a material adverse effect on the operations of the respective segment and may have a material adverse effect on our consolidated results of operations. Distributors Sales to distributors accounted for approximately 54%, 53% and 52% of our revenue in 2025, 2024 and 2023, respectively.
In addition to our power technologies, we believe our integrated circuit, signal and protection technologies have significant performance advantages over our competition. PSG’s primary competitors include: 9 Table of Contents Infineon Technologies AG ("Infineon"), STMicroelectronics N.V. ("STMicroelectronics"), Wolfspeed Inc., ROHM Semiconductor and Nexperia BV.
In addition to our power technologies, we believe our integrated circuit, signal, and protection technologies have significant performance advantages over our competition. PSG’s primary competitors include: Infineon Technologies AG ("Infineon"), STMicroelectronics N.V. ("STMicroelectronics"), Wolfspeed Inc., ROHM Semiconductor and Nexperia BV.
We purchased 80% of Leshan's production capacity in each of 2024, 2023 and 2022, and are currently committed to purchase approximately 80% of Leshan's expected production 11 Table of Contents capacity in 2025. We use third-party contractors for some of our manufacturing activities, primarily for wafer fabrication and the assembly and testing of finished goods.
We purchased 80% of Leshan's production capacity in each of 2025, 2024 and 2023, and are currently committed to purchase approximately 80% of Leshan's expected production capacity in 2026. We use third-party contractors for some of our manufacturing activities, primarily for wafer fabrication and the assembly and testing of finished goods.
Our joint venture partner is Leshan Radio Company Ltd. ("Leshan Radio"), formerly a Chinese state-owned enterprise. Pursuant to the joint venture agreement between us and Leshan Radio, requests for production capacity are made to the board of directors of Leshan by each shareholder of the joint venture.
Our joint venture partner is Leshan Radio Company Ltd. ("Leshan Radio"). Pursuant to the joint venture agreement between us and Leshan Radio, requests for production capacity are made to the board of directors of Leshan by each shareholder of the joint venture.
For information regarding risks associated with import-export control regulations and similar applicable laws and regulations, see "Risk Factors—Trends, Risks and Uncertainties Related to Our Business" included elsewhere in this Form 10-K. Environmental, Social and Governance Initiatives onsemi strives to be a responsible corporate citizen.
For information regarding risks associated with import-export control regulations and similar applicable laws and regulations, see "Risk Factors — Trends, Risks and Uncertainties Related to Our Business" included elsewhere in this Form 10-K. 13 Corporate Responsibilities onsemi aims to be a responsible corporate citizen.
Our policy is to protect our products and processes by asserting our IP rights where appropriate and prudent and by obtaining patents, copyrights and other IP rights used in connection with our business when practicable and appropriate. We believe the duration of our IP rights is adequate to protect our products and processes.
Our policy is to protect our products and processes by asserting our IP rights where appropriate and prudent and by obtaining patents, copyrights and other IP rights used in connection with our business when practicable and appropriate.
For information regarding risks associated with intellectual property, see "Risk Factors — Trends, Risks and Uncertainties Related to Intellectual Property" included elsewhere in this Form 10-K. Seasonality We are currently experiencing fluctuations in our operating results due to general industry and macroeconomic conditions as well as within the semiconductor industry.
For information regarding risks associated with intellectual property, see "Risk Factors — Trends, Risks and Uncertainties Related to Intellectual Property" included elsewhere in this Form 10-K. Seasonality During recent years, we experienced fluctuations in our operating results due to macroeconomic conditions, as well as those within the semiconductor industry.
Name Age Position Hassane El-Khoury 45 President, Chief Executive Officer and Director Thad Trent 57 Executive Vice President, Chief Financial Officer and Treasurer Simon Keeton 51 Group President, PSG Sudhir Gopalswamy 55 Group President, ISG and AMG All of our executive officers are also officers of SCI LLC.
Name Age Position Hassane El-Khoury 46 President, Chief Executive Officer and Director Thad Trent 58 Executive Vice President and Chief Financial Officer Simon Keeton 53 Group President, PSG Sudhir Gopalswamy 56 Group President, ISG and AMG All of our executive officers are also officers of SCI LLC.
Automotive Industrial Other 2024 Revenue (%) 55% 25% 20% Sample applications EV Energy & EV Charging Infrastructure AI / Data Center ADAS Industrial Automation 5G Base Stations Power Management Security & Surveillance Graphics Cards Powertrain Machine Vision Gaming, Home Entertainment Systems, & Set Top Boxes In-Vehicle Networking Smart Cities & Buildings Routers Body & Interior Hearing Health, Diagnostic, Therapy, & Monitoring Notebooks, Laptops, Desktop PCs & Tablets Lighting Power Solutions USB Type-C Sensors AR/VR White Goods Engine Control Motor Control Power Supplies Robotics Smart Phones Competition We face significant competition from major international semiconductor companies, as well as smaller companies focused on specific market niches.
Automotive Industrial Other 2025 Revenue (%) 51% 28% 21% Sample applications EV Energy generation, storage, & EV charging infrastructure AI data center ADAS and advanced safety Industrial automation 5G base stations Power management Aerospace, defense, & security Gaming, home entertainment systems, & set top boxes Powertrain Machine vision Routers In-Vehicle networking Smart cities & buildings Notebooks, laptops, desktop PCs & tablets Body & interior Hearing health, diagnostic, therapy, & monitoring White goods Lighting Power solutions Power supplies Sensors Motor control Smart phones Engine control Robotics and humanoids Competition We face significant competition from major international semiconductor companies, as well as smaller companies focused on specific market niches.
In general, we have maintained long-term relationships with our key customers, and our sales agreements are renewable periodically and contain certain terms and conditions with respect to payment, delivery, warranty and supply. During 2024, certain long-term supply agreements with strategic end-customers were modified upon mutual agreement.
In general, we have maintained long-term relationships with our key customers, and our sales agreements are renewable periodically and contain certain terms and conditions with respect to payment, delivery, warranty and supply.
This integration allows lower temperature operation and reduced cooling requirements while saving costs and minimizing weight. In addition, our power solutions deliver power with less die per module, achieving higher range for a given battery capacity.
Through sensing integration, we believe our intelligent power solutions achieve increased efficiencies compared to our peers. This integration allows lower temperature operation and reduced cooling requirements while saving costs and minimizing weight. In addition, our power solutions deliver power with less die per module, achieving higher range for a given battery capacity.
We had one distributor whose revenue accounted for approximately 10% of the total revenue for the year ended December 31, 2024. There were no distributors whose revenue exceeded 10% or more of total revenue for the year ended December 31, 2023.
We had one distributor whose revenue accounted for approximately 11% and 10% of the total revenue for the years ended December 31, 2025 and 2024, respectively. There were no distributors whose revenue accounted for more than 10% of total revenue for the year ended December 31, 2023.
See Note 7: ''Restructuring, Asset Impairments and Other Charges, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information. We continue to evaluate employee positions and locations for 5 Table of Contents potential operating improvements and efficiencies.
For additional information, see Note 7: ''Restructuring, Asset Impairments and Other, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K. We continue to evaluate our employee workforce composition (both employee positions and locations) and manufacturing capacity and footprint for potential operational improvements and efficiencies.
We are focused on achieving efficiencies in our operating and capital expenditures, capital allocation on research and development investments and resources to accelerate growth in high-margin products. 2025 Acquisition On January 14, 2025, we completed the previously announced acquisition of the Silicon Carbide Junction Field-Effect Transistor ("SiC JFET") technology business from Qorvo US, Inc., and certain of its subsidiaries, for $118.8 million in cash, subject to working capital adjustments.
We intend to achieve efficiencies in our operating and capital expenditures and invest in research and development initiatives to accelerate growth in high-margin products. 2025 Significant Activities Acquisitions On January 14, 2025, we completed the acquisition of the Silicon Carbide Junction Field-Effect Transistor ("SiC JFET") technology business from Qorvo US, Inc., and certain of its subsidiaries, for $118.8 million in cash.
Approximately 15% of our regular full-time employees are located in the United States and Canada, 12% in Europe and Middle Eastern countries and 73% in Asia Pacific and Japan, with approximately 72% engaged in manufacturing, 2% in research and development, 4% in customer service or other aspects of sales and marketing, and 22% in other roles.
Of our regular full‑time workforce, roughly 15% are based in the United States and Canada, 12% in Europe and the Middle East, and 73% in Asia Pacific and Japan. Around 72% of employees work in manufacturing, 2% in research and development, 4% in customer service or other sales and marketing functions, and 22% in other roles.
We also have foreign design operations in Belgium, Canada, China, the Czech Republic, Germany, India, Ireland, Israel, Italy, Japan, South Korea, the Philippines, Romania, Singapore, the Slovak Republic, Slovenia, Switzerland, Taiwan and the United Kingdom.
Manufacturing and Design Operations We currently have domestic design operations in Arizona, California, Idaho, New York, Oregon, Pennsylvania, Rhode Island and Texas. We also have foreign design operations in Belgium, Canada, China, the Czech Republic, Germany, India, Ireland, Israel, Italy, Japan, South Korea, the Philippines, Romania, Singapore, the Slovak Republic, Slovenia, Switzerland, Taiwan and the United Kingdom.
The following table sets forth our principal end-markets, the estimated percentage (based in part on information provided by our distributors) of our revenue generated from each end-market during 2024, and sample applications for our products. Other includes the end-markets of computing, consumer, networking, communication, etc.
The following table sets forth our principal end-markets, the estimated percentage of our revenue generated from each end-market during 2025, and sample applications for our products. Other includes the end-markets of AI data center, computing, consumer, networking, communication, etc.
The following table illustrates the product technologies under each of our segments based on our operating strategy: PSG AMG ISG 2024 Revenue (%) 47% 37% 16% SiC products Analog products Actuator Drivers Discrete products ASIC products CMOS image sensors MOSFET products Logic and Isolation products Image Signal Processors Power Module products Non-Volatile Memory products Single Photon Detectors Foundry products/services Short-Wavelength Infrared products Gate Driver products Indirect Time of Flight sensors LSI products See Note 3: ''Segments and Revenue'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for other information regarding our segments, their revenue and gross profit derived from each segment.
We believe that our ability to offer a broad range of products, combined with our global manufacturing and logistics network, provides our customers with single source purchasing. 7 Table of Contents The following table illustrates the product technologies under each of our segments based on our operating strategy: PSG AMG ISG 2025 Revenue (%) 47% 38% 15% SiC products Analog products Actuator Drivers SiC JFET products ASIC products CMOS image sensors Discrete products Logic and Isolation products Image Signal Processors MOSFET products Non-Volatile Memory products Single Photon Detectors Power Module products Ultrasonic Short-Wavelength Infrared Vertical GaN Inductive sensing Indirect Time of Flight sensors Gate Driver products See Note 3: ''Segments and Revenue'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for other information regarding our segments, their revenue and gross profit derived from each segment.
Human Capital Resources Core Principles Our success depends on our ability to attract, train, retain and motivate our employees involved in the design, development, manufacturing and support of new and existing products and services.
Human Capital Resources Core Principles Our success depends on our ability to attract, train, retain, and motivate the employees who design, develop, manufacture, and support our products and services.
Because some of our components include functionality that in some cases may be integrated into more complex ICs, we also face competition from manufacturers of ICs, ASICs and fully-customized ICs, as well as customers who develop their own IC products. See "Risk Factors—Trends, Risks and Uncertainties Related to Our Business" included elsewhere in this Form 10-K for additional information.
Because some of our components include functionality that in some cases may be integrated into more complex ICs, we also face competition from manufacturers of ICs, ASICs and fully-customized ICs, as well as customers who develop their own IC products.
We provide our employees and their families with access to flexible and convenient health and wellness programs, including benefits that secure them during events that may require time away from work or that impact their financial well-being.
We offer employees and their families flexible and convenient health and wellness programs, along with benefits designed to support them during life events that require time away from work or affect their financial well‑being.
We use a combination of total rewards and other programs (which vary by region and salary grade) to attract and retain our employees, including: annual performance bonuses; stock awards, including an employee stock purchase plan; retirement support; healthcare and insurance benefits; business travel and disability insurance; health savings and flexible spending accounts; flexible work schedules, vacation and paid time off; parental leave; paid counseling assistance; education assistance; and on-site services, such as health centers and fitness centers.
We provide a comprehensive mix of total rewards and other programs—varying by region and salary grade—including annual performance bonuses; stock awards and an employee stock purchase plan; retirement support; healthcare and insurance coverage; business travel and disability insurance; health savings and flexible spending accounts; flexible work arrangements; vacation and paid time off; parental leave; counseling assistance; education support; and on‑site services, such as health centers and fitness facilities. 14 Career Growth and Development We invest in professional development and growth to strengthen employee motivation, performance, and retention.
See Note 5: ''Acquisitions and Divestitures'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information. 6 Table of Contents Revenue-Generating Activities onsemi generates revenue primarily from the sale of semiconductor products to distributors and direct customers.
See Note 9: ''Long-Term Debt'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information. Revenue-Generating Activities onsemi generates revenue primarily from the sale of semiconductor products to distributors and direct customers. We also generate revenue, to a much lesser extent, from product development agreements.
We believe the evolution of the automotive industry, with advancements in autonomous driving, ADAS, vehicle electrification, and the increase in electronics content for vehicle platforms, is reshaping the boundaries of transportation. Through sensing integration, we believe our intelligent power solutions achieve superior efficiencies compared to our peers.
Our intelligent sensing technologies enable advanced safety applications in automotive through industry leading performance and reliability. We believe the evolution of the automotive industry, with advancements in autonomous driving, ADAS, vehicle electrification, and the increase in electronics content for vehicle platforms is reshaping the boundaries of transportation.
We seek to obtain our raw materials and supplies in a timely, planned manner from our suppliers to allow for our manufacturing cycle to align with the timing of our customer demands.
We seek to obtain our raw materials and supplies in a timely, planned manner from our suppliers to allow for our manufacturing cycle to align with the timing of our customer demands. However, suppliers may extend lead times, limit supplies or increase prices due to capacity constraints or other factors beyond our control.
We had one distributor whose revenue accounted for approximately 12% of the total revenue for the year ended December 31, 2022. Our distributors resell our products to OEMs, contract manufacturers, and other end-customers. Sales to distributors are typically made pursuant to agreements that provide return rights and stock rotation provisions permitting limited levels of product returns.
Our distributors provide fulfillment services and resell our products to OEMs, contract manufacturers, and other end-customers. Sales to distributors are typically made pursuant to agreements that provide return rights and stock rotation provisions permitting limited levels of product returns.
These agreements are subject to our standard terms and conditions, and generally include minimum purchase commitments and provisions allowing for renegotiation upon mutual agreement. We generally warrant that products sold to our customers will, at the time of shipment, be free from defects in workmanship and materials and conform to our approved specifications.
We generally warrant that products sold to our customers will, at the time of shipment, be free from defects in workmanship and materials and conform to our approved specifications.
We believe the acquisition complements our EliteSiC power portfolio within the PSG reportable segment and enables us to help address the need for high energy efficiency and power density in the AC-DC stage in power supply units for AI data centers. 2024 Activities 2024 Business Realignment In an effort to streamline resources, drive organizational efficiencies, consolidate our global corporate footprint, and align with our "Fab Right" manufacturing strategy, we continued our business realignment efforts during 2024.
We believe the acquisition complements our EliteSiC power portfolio within the PSG reportable segment and enables us to help address the need for high energy efficiency and power density in the AC-DC stage in power supply units for AI data centers.
Direct Customers Sales to direct customers accounted for approximately 47%, 48% and 42% of our revenue in 2024, 2023 and 2022, respectively. Large multi-nationals and selected regional OEMs, which are significant in specific markets, form our core direct customers. Generally, these customers do not have the right to return our products following a sale other than pursuant to our warranty.
Direct Customers Sales to direct customers accounted for approximately 46%, 47% and 48% of our revenue in 2025, 2024 and 2023, respectively. Large multi-national companies and selected regional OEMs, which are significant in specific markets, form our core direct customers.
The table below sets forth information with respect to the manufacturing facilities we operate either directly or pursuant to joint ventures, the reportable segments that use such facilities, and the approximate gross square footage of each site's building, which includes, among other things, manufacturing, laboratory, warehousing, office, utility, support and unused areas.
In addition to these front-end and back-end manufacturing operations, our facility in Hudson, New Hampshire manufactures SiC crystal boules and our facilities in Rožnov pod Radhoštěm, the Czech Republic and Bucheon, South Korea manufacture silicon and SiC wafers that are used by a number of our facilities. 11 Table of Contents The table below sets forth information with respect to the manufacturing facilities we operate either directly or pursuant to joint ventures, the reportable segments that use such facilities, and the approximate gross square footage of each site's building, which includes, among other things, manufacturing, laboratory, warehousing, office, utility, support and unused areas.
Approximately 230 of our domestic employees (or approximately 1% of our United States-based employees) are covered by a collective bargaining agreement, and all of these employees are located at our Mountain Top, Pennsylvania manufacturing facility.
Approximately 150 of our U.S. employees, about 4% of our U.S. workforce, are covered by a collective bargaining agreement, all of whom are located at our Mountain Top, Pennsylvania manufacturing facility.
We have a goal to achieve net zero emissions by 2040, supported by our climate change policy, which highlights the focus areas for climate change-related actions. In 2024, our near-term greenhouse gas emissions targets were validated by the Science Based Targets initiative. We have formulated a strategy and are taking initial steps towards the achievement of our targets.
We have a goal to achieve net zero emissions by 2040, supported by our climate change policy, which highlights the focus areas for climate change-related actions.
Resources Raw Materials Our manufacturing processes use many raw materials, including silicon wafers, SiC wafers, laminate substrates, gold, copper, lead frames, mold compound, ceramic packages and various chemicals and gases, as well as other production supplies used in our manufacturing processes.
In the semiconductor industry, backlog quantities and shipment schedules under outstanding purchase orders are frequently revised to reflect changes in customer needs. Resources Raw Materials Our manufacturing processes use many raw materials, including silicon wafers, SiC wafers, laminate substrates, gold, copper, lead frames, mold compound, ceramic packages and various chemicals and gases.
Share Repurchases During the year ended December 31, 2024, we repurchased approximately 9.1 million shares of our common stock for an aggregate purchase price of approximately $650 million, which excludes fees, commissions and excise taxes.
Share Repurchases During the year ended December 31, 2025, we repurchased approximately 27.9 million shares of our common stock for an aggregate purchase price of approximately $1,375.0 million, excluding fees, commissions and excise taxes. See Note 10: ''Earnings Per Share and Equity'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information.
Some of our competitors have greater financial and other resources to pursue development, engineering, manufacturing, marketing and distribution of their products and may generally be better situated to withstand adverse economic or market conditions. The semiconductor industry has experienced, and may continue to experience, significant consolidation among companies and vertical integration among customers.
See "Risk Factors — Trends, Risks and Uncertainties Related to Our Business" included elsewhere in this Form 10-K for additional information. Some of our competitors have greater financial and other resources to pursue development, engineering, manufacturing, marketing and distribution of their products and may generally be better situated to withstand adverse economic or market conditions.
As of December 31, 2024, we were organized into three operating and reportable segments: the Power Solutions Group ("PSG"), the Analog and Mixed-Signal Group ("AMG") and the Intelligent Sensing Group ("ISG").
As of December 31, 2025, we were organized into three operating and reportable segments: the Power Solutions Group ("PSG"), the Analog and Mixed-Signal Group ("AMG") and the Intelligent Sensing Group ("ISG"). Business Strategy Developments We are focused on increasing profitable revenue through differentiated technologies to address the high-growth megatrends in automotive, industrial and other markets which include AI data centers.
Our intelligent power technologies enable the electrification of the automotive industry that allows for lighter and longer-range electric vehicles, empowers efficient fast-charging systems and propels sustainable energy for the highest efficiency solar strings and industrial power. Our intelligent power solutions for the automotive industry allow our customers to exceed range targets with lower weight and reduce system cost through efficiency.
We offer intelligent power and intelligent sensing solutions that drive electrification, energy efficiency, safety, and automation in automotive, industrial, and other end-markets, including AI data center. Our intelligent power technologies enable the electrification of drivetrain in the automotive industry to allow for lighter and longer-range electric vehicles and empower efficient fast-charging systems.
(2) This facility is used for both front-end and back-end operations. (3) These facilities are located on leased land. For additional information regarding acquisitions and divestitures, see Note 5: ''Acquisitions and Divestitures'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K.
(2) This facility is used for both front-end and back-end operations. (3) These facilities are located on leased land.
We acquired, licensed or sublicensed a significant amount of IP, including patents and patent applications, in connection with our acquisitions, and we have numerous United States and foreign patents issued, allowed and pending. We do not consider our business substantially dependent on any single onsemi patent.
We hold a substantial number of issued and pending patents worldwide and continue to prosecute applications in areas that are material to our business. We do not consider our business substantially dependent on any single onsemi patent.
Products and Technology The following provides certain information regarding the products and technologies for each of our operating segments. PSG PSG offers a wide array of discrete, module and integrated semiconductor products that perform multiple application functions, including power switching, signal conditioning, and circuit protection.
Products and Technology The following provides certain information regarding the products and technologies for each of our operating segments. PSG PSG provides a broad portfolio of discrete, module, and integrated semiconductor devices designed to enable high‑efficiency and high‑power conversion across AI data centers, energy infrastructure, automotive and industrial.
Certain of our foreign employees are covered by collective bargaining arrangements (e.g., those in China, Vietnam, Japan, the Czech Republic and Belgium) or similar arrangements or are represented by workers councils. 13 Compensation, Benefits, Health, Safety and Wellness Our compensation philosophy is focused on delivering competitive compensation with total rewards based on corporate affordability in a way that enables attraction, retention, and recognition of performance.
In addition, certain employees outside the United States are covered by collective bargaining agreements or similar arrangements (e.g., those in China, Vietnam, Japan, the Czech Republic, and Belgium) or are represented by works councils.
As we are a member of the RBA, its principles are fundamental to our corporate culture and core values and are reflected in our commitments to our employees, customers, communities and other stakeholders. These principles include providing a safe and positive work environment for our employees that emphasizes learning, professional development and respect for individuals and ethical conduct.
We value the diversity of our global workforce and are intentional about creating opportunities for growth and development, welcoming a wide range of perspectives, and fostering an inclusive environment where everyone can thrive. As a member of the RBA, its principles are deeply embedded in our culture and core values, shaping our commitments to employees, customers, communities, and other stakeholders.
Of particular importance in the onsemi portfolio are the intelligent power technologies based on silicon and silicon carbide, wide band gap technologies, which we use to design, manufacture, and deliver to our customers as bare die, packaged discrete solutions or power module solutions.
A central focus of our portfolio is intelligent power technology based on silicon, silicon carbide, and GaN. These wide bandgap technologies are designed and manufactured by onsemi and supplied to customers in multiple forms, including bare die, packaged discrete products, and complete power modules.
We believe our compensation philosophy, along with the career growth and development opportunities we offer, promotes longer employee tenure and reduces voluntary turnover. Information about Our Executive Officers Certain information concerning our executive officers as of February 10, 2025 is set forth below.
Information about Our Executive Officers Certain information concerning our executive officers as of February 9, 2026 is set forth below.
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We provide intelligent power and intelligent sensing solutions with a primary focus towards automotive and industrial markets to help our customers solve challenging problems and create cutting-edge products for a better future. We are utilizing our extensive range of power technologies to help address the growing power demands of AI and data centers.
Added
In the industrial market, our intelligent power technologies propel sustainable energy for the highest efficiency solar strings and industrial power. In the medical field, our intelligent power technologies extend the life of personal diagnostic devices, such as continuous glucose monitors. Our intelligent sensing technologies support the next generation industry through automation, allowing for smarter factories and buildings.
Removed
Our intelligent sensing technologies support the next generation industry, allowing for smarter factories and buildings while also enhancing the automotive mobility experience with imaging and depth sensing that make advanced vehicle safety and automated driving systems possible.
Added
In addition, our intelligent sensing technologies are enabling robotics and humanoids. In our other market which includes AI data center products, our intelligent power technologies enable energy efficiency in a market in which energy needs are growing at an exponential rate, and AI data center operators are focused on reducing energy consumption.
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During the first quarter of 2024, we reorganized the existing divisions within certain of our operating and reportable segments and renamed the Advanced Solutions Group ("ASG") reportable segment to AMG. See Note 3: ''Segments and Revenue'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information regarding the segment reorganization.
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We believe we have one of the most comprehensive portfolios of products and technologies for this market to address the complete power tree, and we are well positioned to benefit as new generation of AI data center processors and racks enter the market.
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Business Strategy Developments Our primary focus continues to be on revenue growth with stable gross margin by capturing high-growth megatrends in our focused end-markets of automotive and industrial infrastructure. We design products in highly-differentiated markets focused on customer needs while optimizing and right-sizing our manufacturing footprint to support growth with new product development and maintain gross margins through efficiencies.
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We continue to optimize and right-size our manufacturing footprint to align our capacity with our long-term outlook, while focusing on generating efficiencies that result in meaningful gross margin expansion and operating cash flows.
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Under this plan, approximately 1,200 employees were notified of their employment termination and around 300 additional employees were reassigned or asked to relocate to another site. During the year ended December 31, 2024, we recorded severance costs, asset impairments and other related charges of approximately $75.7 million, $37.8 million and $16.3 million, respectively.
Added
On October 27, 2025, we completed the acquisition of rights to Vcore power technologies, including associated intellectual property licenses, from Aura Semiconductor enhancing our power management portfolio. The total purchase consideration is up to $144 million, subject to customary purchase price adjustments, with $7 million paid in cash at close.
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See Note 10: ''Earnings Per Share and Equity'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information. 2023 Activities 2023 Business Realignment During 2023, we realigned our operating models in AMG (formerly "ASG"), Corporate information technology ("IT") organization and certain manufacturing locations in order to streamline our operations, achieve organizational efficiencies and consolidate resources into fewer, common sites across the world to align with the next phase of our multi-year "Fab Right" manufacturing strategy.
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Of the total purchase price, $72 million is payable upon acceptance and delivery of specified products and the remaining $72 million is contingent upon the achievement of certain revenue milestones through 2030. 6 Table of Contents 2025 Manufacturing Realignment Program During the first quarter of 2025, we announced restructuring and cost reduction initiatives based on an evaluation of our operating structure, business strategy, manufacturing technologies and internal capabilities to realign our internal manufacturing capacity and capabilities with anticipated long-term needs.
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Under this plan, approximately 1,900 employees were notified of their employment termination. We incurred severance costs and related charges of approximately $59.1 million related to these actions in 2023.
Added
We incurred total severance costs and related benefit expenses of $67.1 million related to the termination of approximately 2,400 employees. Additionally, we recorded non-cash impairment charges of $496.0 million during the year ended December 31, 2025 related to previous investments in manufacturing equipment at certain manufacturing facilities pursuant to held-for-sale accounting guidance.
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See Note 7: ''Restructuring, Asset Impairments and Other Charges, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information. 1.625% Notes maturity and repayment On October 16, 2023, we repaid $119.6 million of the remaining outstanding principal amount of the 1.625% Notes in cash and settled the excess over the principal amount by issuing 4.5 million shares of our common stock.
Added
Other charges of $103.9 million for the year ended December 31, 2025, comprised of other exit costs, accelerated depreciation and contract termination costs, were incurred as part of the program. The total of the aforementioned costs was included within Restructuring, Asset Impairments and Other, Net in the Consolidated Statement of Operations.
Removed
Under the previously executed bond hedge agreements, we also repurchased an equivalent number of shares of our common stock, for no additional consideration, to effectively offset the issuance of shares. Credit Agreement On June 22, 2023, we entered into a new Credit Agreement to replace the Revolver due 2024, which was set to mature on June 28, 2024.
Added
We also recorded $268.2 million relating to excess and obsolete inventory charges, of which $37.9 million and $230.3 million related to inventory primarily considered work in progress within the PSG and ISG reportable segments, respectively.
Removed
We drew $375.0 million against the Revolving Credit Facility and repaid the entire outstanding balance under the Revolver due 2024.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeBecause a significant portion of our revenue is derived from customers in the automotive and industrial end-markets, including revenue pursuant to our long-term supply agreements, a downturn or lower sales to customers in either end-market could materially adversely affect our business and results of operations.
Biggest changeIf we are unable to access such funding or incentives, or if any awards or incentives we do receive are reduced, terminated or clawed back, or if our competitors receive more funding or incentives than we do, we may be at a disadvantage in developing and producing new or improved products or technologies, which could adversely affect our market share, revenue and profitability. 19 Because a significant portion of our revenue is derived from customers in the automotive and industrial end-markets, including revenue pursuant to our long-term supply agreements, a downturn or lower sales to customers in either end-market could materially adversely affect our business and results of operations.
Our manufacturing network includes multiple owned and third-party facilities, which may each produce one or more components necessary for the assembly of a single product. As a result of this interdependence, an operational disruption at a facility may have a disproportionate impact on our ability to produce many of our products.
Our manufacturing network includes multiple owned and third-party facilities, which may each produce one or more components necessary for the assembly of a single product. As a result of this interdependence, an operational disruption at a single facility may have a disproportionate impact on our ability to produce many of our products.
Consolidation among competitors and integration among customers could erode our market share, impair our capacity to compete and require us to restructure operations, any of which could have a material adverse effect on our business. In addition, some of our competitors may receive governmental subsidies or other incentives that give them a competitive advantage over us.
Consolidation among competitors and integration among customers could erode our market share, impair our capacity to compete and require us to restructure our operations, any of which could have a material adverse effect on our business. In addition, some of our competitors may receive governmental subsidies or other incentives that give them a competitive advantage over us.
Our failure to commercialize new technologies that can power AI and data centers in a timely manner or at all could result in loss of market share, unanticipated costs, and inventory obsolescence, which could adversely affect our financial results.
Our failure to commercialize new technologies that can power AI data centers in a timely manner or at all could result in a loss of market share, unanticipated costs and inventory obsolescence, which could adversely affect our financial results.
If we do not generate sufficient cash to satisfy our debt obligations as they come due, we may have to undertake alternative financing plans, such as refinancing or restructuring our debt, selling additional assets, reducing or delaying capital investments, or seeking to raise additional capital.
If we do not generate sufficient cash to satisfy our debt obligations as they come due, we may have to undertake alternative financing plans, such as refinancing or restructuring our debt, selling assets, reducing or delaying capital investments, or seeking to raise additional capital.
Depending on the function involved and despite the availability of contractual remedies against these providers, such errors can also lead to business disruption, systems performance degradation, processing inefficiencies or other systems disruptions, the loss of or damage to intellectual property or sensitive data through security breaches or otherwise, incorrect or adverse effects on financial reporting, litigation, claims, legal or regulatory proceedings, inquiries or investigations, fines or penalties, remediation costs, damage to our reputation or have a negative impact on employee morale, all of which can materially adversely affect our business.
Depending on the function involved and despite the availability of contractual remedies against these providers, such errors can also lead to business disruption, systems performance degradation, processing inefficiencies or other systems disruptions, the loss or theft of or damage to intellectual property or sensitive data through security breaches or otherwise, incorrect or adverse effects on financial reporting, litigation, claims, legal or regulatory proceedings, inquiries or investigations, fines or penalties, remediation costs, damage to our reputation or have a negative impact on employee morale, all of which can materially adversely affect our business.
In the event of an adverse outcome or pursuant to the terms of a settlement of any such litigation, we may be required to: pay substantial damages or settlement costs; indemnify customers or distributors; cease the manufacture, use, sale or importation of infringing products; expend significant resources to develop or acquire non-infringing technologies; discontinue the use of certain processes; or obtain licenses, which may not be available on reasonable terms, to continue the use, development and/or sale of the allegedly infringing technologies.
In the event of an adverse outcome or pursuant to the terms of a settlement of any such litigation, we may be required to pay substantial damages or settlement costs; indemnify customers or distributors; cease the manufacture, use, sale or importation of infringing products; expend significant resources to develop or 22 acquire non-infringing technologies; discontinue the use of certain processes; or obtain licenses, which may not be available on reasonable terms, to continue the use, development and/or sale of the allegedly infringing technologies.
Any associated worker absenteeism, quarantines and restrictions on certain of our employees’ ability to perform their jobs, office 16 and factory closures or restrictions, labor shortages, disruptions to ports and other shipping infrastructure, border closures and/or other travel or health-related restrictions could, depending on the magnitude of such effects on our manufacturing activities (or activities of our suppliers, third-party distributors or sub-contractors), cause disruption and delay to our supply chain, manufacturing and product shipments.
Any associated worker absenteeism, quarantines and restrictions on certain of our employees’ ability to perform their jobs, office and factory closures or restrictions, labor shortages, disruptions to ports and other shipping infrastructure, border closures and/or other travel or health-related restrictions could, depending on the magnitude of such effects on our manufacturing activities (or activities of our suppliers, third-party distributors or sub-contractors), cause disruption and delay to our supply chain, manufacturing and product shipments.
In addition, design wins do not guarantee that we will make customer sales or generate sufficient revenue to recover design and development investments, realize a return on the capital expended or achieve expected gross margins, as expenditures for technology and product development are generally made before the commercial viability for such developments can be assured.
In addition, design wins do not guarantee that we will make customer sales or generate sufficient revenue to recover design and development investments, realize a return on the capital expended or achieve expected gross margins, as expenditures for technology and product development are generally 18 made before the commercial viability for such developments can be assured.
To the extent that we underinvest in our research and development efforts, fail to recognize the need for innovation with respect to our products, or our investments and capital expenditures in research and development do not lead to sales of new products, we may be unable to bring to market technologies and products attractive to customers, and so our business, financial condition and results of operations may be materially adversely affected.
To the extent that we underinvest in our research and development efforts, fail to recognize the need for innovation with respect to our products, or our investments and capital expenditures in research and development do not lead to sales of new products, we may be unable to bring to market technologies and products attractive to customers and our business, financial condition and results of operations may be materially adversely affected.
Shortages could occur in various essential raw materials, and if we are unable to obtain adequate supplies of raw materials in a timely manner, the costs of our raw materials increase significantly, their quality deteriorates or they give rise to compatibility or performance issues in our products, our results of operations could be materially adversely affected.
However, shortages could occur in various essential raw materials, and if we are unable to obtain adequate supplies of raw materials in a timely manner, the costs of our raw materials increase significantly, their quality deteriorates or they give rise to compatibility or performance issues in our products, our results of operations could be materially adversely affected.
If we are unable to identify and make the substantial research and development investments or develop new products required to satisfy customer demands, our business, financial condition and results of operations may be materially adversely affected. The semiconductor industry requires substantial investment in research and development in order to develop and bring to 17 market enhanced technologies and products.
If we are unable to identify and make the substantial research and development investments or develop new products required to satisfy customer demands, our business, financial condition and results of operations may be materially adversely affected. The semiconductor industry requires substantial investment in research and development in order to develop and bring to market enhanced technologies and products.
If 23 we are not in compliance with the FCPA and other laws governing the conduct of business with government entities (including local laws), we may be subject to criminal and civil penalties and other remedial measures, which could have a material adverse impact on our business, financial condition, results of operations and liquidity.
If we are not in compliance with the FCPA and other laws governing the conduct of business with government entities (including local laws), we may be subject to criminal and civil penalties and other remedial measures, which could have a material adverse impact on our business, financial condition, results of operations and liquidity.
Such events can negatively impact revenue and earnings and can significantly impact cash flow. We have been and may be subject to or involved in litigation or threatened litigation, the outcome of which may be difficult to predict, and which may be costly to defend, divert management attention, require us to pay damages, or restrict the operation of our business.
Such events can negatively impact revenue and earnings and can significantly impact cash flow. 30 We have been and may be subject to or involved in litigation or threatened litigation, the outcome of which may be difficult to predict, and which may be costly to defend, divert management attention, require us to pay damages, or restrict the operation of our business.
To the extent that our sales or profitability are negatively affected by any such tariffs or other trade actions, our business and results of 19 operations may be materially adversely affected. Our international sales and purchases are subject to numerous additional United States and foreign laws and regulations related to import and export matters.
To the extent that our sales or profitability are negatively affected by any such tariffs or other trade actions, our business and results of operations may be materially adversely affected. Our international sales and purchases are subject to numerous additional United States and foreign laws and regulations related to import and export matters.
Our financing structure, and any inability to meet our obligations thereunder, could have a material adverse effect on our business and financial condition, including, among other things, our ability to obtain additional financing for working capital, capital expenditures, acquisitions, and other general corporate purposes and could reduce our flexibility to respond to changing business and economic conditions.
Our 26 financing structure, and any inability to meet our obligations thereunder, could have a material adverse effect on our business and financial condition, including, among other things, our ability to obtain additional financing for working capital, capital expenditures, acquisitions, and other general corporate purposes and could reduce our flexibility to respond to changing business and economic conditions.
Any revisions to, inaccuracies in or restatements of our consolidated financial statements due to accounting for our acquisitions could have a material adverse effect our financial condition and results of operations. If our goodwill or amortizable intangible assets become impaired, we may be required to record a significant charge to earnings.
Any revisions to, inaccuracies in or restatements of our consolidated financial statements due to accounting for our acquisitions could have a material adverse effect on our financial condition and results of operations. If our goodwill or amortizable intangible assets become impaired, we may be required to record a significant charge to earnings.
The option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives contracts with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions prior to the maturity of such notes.
The option counterparties or their respective 28 affiliates may modify their hedge positions by entering into or unwinding various derivatives contracts with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions prior to the maturity of such notes.
Our subsidiaries may not be able to, or may not be permitted to, make distributions to enable us to make payments in respect of our indebtedness. Each subsidiary is a distinct legal entity, and, under certain circumstances, legal, contractual, governmental, or regulatory restrictions may limit our ability to obtain cash from our subsidiaries.
Our subsidiaries may not be able to, or may not be permitted to, make distributions to 27 enable us to make payments in respect of our indebtedness. Each subsidiary is a distinct legal entity, and, under certain circumstances, legal, contractual, governmental, or regulatory restrictions may limit our ability to obtain cash from our subsidiaries.
These rules may require us to apply for and obtain additional export licenses to supply certain of our products to customers in China, and there is no assurance that we will be issued licenses that we apply for on a timely basis or at all.
These rules may require us to apply for and obtain additional export licenses to supply certain of our products to customers in China, and there is no assurance that we will be issued licenses that we apply for 20 on a timely basis or at all.
Our power technologies used for AI may not capture market share as expected, and issues related to the responsible use of AI may adversely affect our business. Our extensive range of power technologies are used to help power AI and related data centers and we expect this part of our business to grow.
Our power technologies designed for AI use may not capture market share as expected, and issues related to the responsible use of AI may adversely affect our business. Our extensive range of power technologies are used to help power AI data centers and we expect this part of our business to grow.
Our business operations, productivity and customer relations could be materially adversely affected if these contractual relationships were disrupted or terminated, the cost of such services increased significantly, the quality of the services provided deteriorated or our forecasted needs proved to be materially incorrect.
Our business operations, productivity and customer relations could be materially adversely affected if these contractual relationships were disrupted or terminated, the cost of such services increased significantly, the quality of the services deteriorated or our forecasted needs proved to be materially incorrect.
Failure by these third-party service providers to meet their contractual, regulatory and other obligations to us, or our failure to 22 adequately monitor their performance, could result in our inability to achieve expected efficiencies and result in additional costs to correct errors made by such service providers.
Failure by these third-party service providers to meet their contractual, regulatory and other obligations to us, or our failure to adequately monitor their performance, could result in our inability to achieve expected efficiencies and result in additional costs to correct errors made by such service providers.
Successful acquisitions and alliances in our industry require, among other things, efficient integration and aligning of product offerings and manufacturing operations and coordination of sales and marketing and research and development efforts, often in markets or regions in which we have less experience.
Successful acquisitions, collaborations and alliances in our industry require, among other things, efficient integration and aligning of product offerings and manufacturing operations and coordination of sales and marketing and research and development efforts, often in markets or regions in which we have less experience.
If any of the following trends, risks or uncertainties actually occurs or continues, our business, financial condition or operating results could be materially and adversely affected, the trading price of our securities could decline, and you could lose all or part of your investment.
If any of the following trends, risks or uncertainties occurs or continues, our business, financial condition or operating results could be materially and adversely affected, the trading price of our securities could decline, and you could lose all or part of your investment.
The semiconductor industry continues to be subject to increasing environmental regulations, particularly those that control and restrict the use, transportation, emission, discharge, storage and disposal of certain chemicals, elements and materials used or produced in the semiconductor manufacturing process.
The semiconductor industry continues to be subject to increasing environmental regulations, particularly those that control and restrict the use, transportation, emission, discharge, storage and disposal of certain chemicals, elements and materials used or 24 produced in the semiconductor manufacturing process.
Specific elements of our compensation programs may not be competitive with those of our competitors, and there can be no assurance that we will be able to retain our current personnel or recruit the key personnel we require.
Specific elements of our compensation programs may not be competitive with those of 21 our competitors, and there can be no assurance that we will be able to retain our current personnel or recruit the key personnel we require.
The failure to obtain a license from a third party for IP we use could cause us to incur substantial liabilities or to suspend the manufacture or shipment of products or our use of processes requiring such technologies.
The failure to obtain a license from a third party for IP that we use could cause us to incur substantial liabilities or to suspend the manufacture or shipment of products or our use of processes requiring such technologies.
Moreover, complaints filed against us may not specify the amount of damages that plaintiffs seek, and we therefore may be unable to estimate the possible range of damages that might be incurred should these lawsuits be resolved against us.
Moreover, complaints filed against us may not specify the amount of damages that plaintiffs seek, and we therefore may be unable to estimate the possible range of damages that might be incurred should these lawsuits be resolved unfavorably.
Trends, Risks and Uncertainties Related to Technology and Data Privacy Disruptions or breaches of our information technology systems could irreparably damage our reputation and our business, expose us to liability and materially adversely affect our results of operations.
Trends, Risks and Uncertainties Related to Cybersecurity and Data Privacy Disruptions or breaches of our information technology systems could irreparably damage our reputation and our business, expose us to liability and materially adversely affect our results of operations.
Further, our assertion of IP rights often results in the other party seeking to assert alleged IP rights of its own against us, which may materially and 21 adversely impact our business.
Further, our assertion of IP rights often results in the other party seeking to assert alleged IP rights of its own against us, which may materially and adversely impact our business.
A default under our committed credit facilities, including our Credit Agreement, could also limit our ability to make further 25 borrowings under those facilities, which could materially adversely affect our business and results of operations.
A default under our committed credit facilities, including our Credit Agreement, could also limit our ability to make further borrowings under those facilities, which could materially adversely affect our business and results of operations.
Changes in, and the regulatory implementation of, tariffs or other government trade policies or political conditions could reduce demand for our products, limit our ability to sell our products to certain customers or our ability to comply with applicable laws and regulations, which may materially adversely affect our business and results of operations.
Changes in, and the regulatory implementation of, tariffs or other government trade policies or geopolitical conditions could reduce demand for our products, limit our ability to sell our products to certain customers or our ability to comply with applicable laws and regulations, which may materially adversely affect our business and results of operations.
The outcome of IP litigation is inherently uncertain and, if not resolved in our favor, could materially adversely affect our business, financial condition and results of operations. If we are unable to protect the IP we have developed or licensed, our competitive position, business and results of operations could be materially and adversely affected.
The outcome of IP litigation is inherently uncertain and, if not resolved in our favor, could materially adversely affect our business, financial condition and results of operations. If we fail to, or are unable to, adequately protect the IP we have developed or licensed, our competitive position, business and results of operations could be materially and adversely affected.
In addition, for certain manufacturing activities and for the supply of raw materials, we utilize third-party suppliers. Our agreements with these manufacturers typically require us to commit to purchase services based on forecasted product needs, which may be inaccurate, and, in some cases, require longer-term commitments.
In addition, for certain manufacturing activities and for the supply of raw materials, we utilize third-party suppliers. Our agreements with these suppliers typically require us to commit to purchase goods or services based on forecasted product needs, which may be inaccurate, and, in some cases, require longer-term commitments.
For example, public health crises may cause disruption to our domestic and international operations.
For example, public health crises may cause disruption to our domestic 17 and international operations.
These legal and regulatory requirements, as well as heightened investor expectations, on corporate environmental and social responsibility practices and disclosure are subject to change, can be unpredictable and may be difficult and expensive for us to comply with, given the complexity of our supply chain and our significant outsourced manufacturing.
These legal and regulatory requirements, as well as some investors' heightened expectations, on corporate environmental and social responsibility practices and disclosure are subject to change, can be unpredictable and may be difficult and expensive for us to comply with, given the complexity of our supply chain and our significant outsourced manufacturing.
Further, significant changes in our credit rating, disruptions in the global financial markets, including bank failures, or incurrence of new or refinancing of existing indebtedness at higher interest rates could have a material and adverse effect on our access to and cost of capital for future financings, and financial condition.
Further, significant changes in our credit rating, disruptions in the global financial markets, or incurrence of new or refinancing of existing indebtedness at higher interest rates could have a material and adverse effect on our access to and cost of capital for future financings, and financial condition.
As of December 31, 2024, we had outstanding approximately $804.9 million aggregate principal amount of our 0% Notes, $1,500.0 million aggregate principal amount of our 0.50% Notes and $700.0 million aggregate principal amount of our 3.875% Notes (collectively, the "Outstanding Notes").
As of December 31, 2025, we had outstanding approximately $804.9 million aggregate principal amount of our 0% Notes, $1,500.0 million aggregate principal amount of our 0.50% Notes and $700.0 million aggregate principal amount of our 3.875% Notes (collectively, the "Outstanding Notes").
A portion of our sales occurs through global and regional distributors that are not under our control. We rely on distributors to grow and develop their customer base and anticipate customer needs, and any lack of such actions by our distributors may adversely affect our results of operations.
A portion of our sales occurs through global and regional distributors that are not under our control. We rely on distributors to grow and develop their customer base and anticipate customer needs, and any lack of or underperformance in such actions by our distributors may adversely affect our results of operations.
These independent distributors also generally represent product lines offered by several companies and are not subject to any minimum sales requirements or obligation to market our products to their customers. In turn, distributors could reduce their sales efforts for our products or choose to terminate their representation of us.
These independent distributors also generally represent product lines offered by several companies and are not subject to any minimum sales requirements or obligation to market our products to their customers. Accordingly, distributors could reduce their sales efforts for our products or choose to terminate their representation of us.
We have made, and may continue to make, strategic acquisitions, investments and other alliances including the formation of joint ventures that involve significant risks and uncertainties.
We have made, and may continue to make, strategic acquisitions, investments and other alliances including the formation of joint ventures or collaborations that involve significant risks and uncertainties.
In the event of a disruption at any such facility, we may be unable to effectively source replacement components on acceptable terms from qualified third parties, in which case our ability to produce many of our products could be materially disrupted or delayed.
In the event of such a disruption, we may be unable to effectively source replacement components on acceptable terms from qualified third parties, in which case our ability to produce many of our products could be materially disrupted or delayed.
The emergence of big data and new tools such as machine learning and AI that capitalize on the availability of large data sets is leading semiconductor manufacturers to pursue new products and approaches, and there is an intense competition to capture market share in this emerging market.
The emergence of big data and new tools such as machine learning and AI that capitalize on the availability of large data sets is leading semiconductor manufacturers to pursue new products and approaches, and there is intense competition to capture a share of this emerging market.
From time to time, we have been and may be subject to disputes and litigation, with and without merit, that may be costly and which may divert the attention of our management and our resources in general. The results of complex legal proceedings are difficult to predict.
From time to time, we have been and may be subject to disputes, litigation or regulatory investigations, with and without merit, that may be costly and which may divert the attention of our management and our resources in general. The results of complex legal proceedings are difficult to predict.
There are inherent execution risks in expanding production capacity, whether at one of our own factories or at a third party that we utilize, all of which could increase our costs and negatively impact our operating results.
There are inherent execution risks in expanding or right-sizing production capacity, whether at one of our own factories or at a third-party factory that we utilize, all of which could increase our costs and negatively impact our operating results.
In addition, to the extent we are not able to borrow or refinance debt obligations, we may have to issue additional shares of our common stock, which would have a dilutive effect to the stockholders immediately prior to such issuance.
In addition, to the extent we are not able to borrow or refinance debt obligations, we may have to issue additional shares of our common stock or instruments convertible into common stock, which would have a dilutive effect to the stockholders immediately prior to such issuance.
In addition, in the event a distributor were to face financial difficulty, experience significant operational disruptions or terminate its operations, our revenue and results of operations may be adversely affected. Furthermore, if a significant distributor terminates its operations or were to merge with another distributor, we may be more reliant and dependent on the distribution network of our remaining distributors.
In addition, in the event a distributor were to face financial difficulty, experience significant operational disruptions or terminate its operations, our revenue, cash flow, and results of operations may be adversely affected. Furthermore, if a significant distributor terminates its operations or merges with another distributor, we may be more reliant and dependent on the distribution network of our remaining distributors.
Our manufacturing efficiency is contingent upon the operations of these interdependent processes and will continue to be an important factor in our future profitability, and there can be no assurance that we will be able to maintain our manufacturing efficiency, increase our manufacturing efficiency to the same extent as our competitors, or be successful in our manufacturing rationalization plans.
Our manufacturing efficiency is contingent upon the operations of these interdependent processes and will continue to be an important factor in our future profitability, and there can be no assurance that we will be able to maintain our manufacturing efficiency, increase our manufacturing efficiency to the same extent as our competitors when facing an increased demand, or be successful in our manufacturing rationalization plans.
Risks related to successful integration of an acquisition include, but are not limited to: (1) the ability to integrate information technology and other systems; (2) issues not discovered in our due diligence; (3) customers responding by changing their existing business relationships with us or the acquired company; (4) diversion of management’s attention from our day to day operations; and (5) loss of key employees post-integration.
Risks related to successful integration of an acquisition include, but are not limited to the ability to integrate information technology and other systems; issues not discovered in our due diligence; customers responding by changing their existing business relationships with us or the acquired company; diversion of management’s attention from our day to day operations; and loss of key employees post-integration.
If we cannot advance our process technologies or improve our production efficiencies to a degree sufficient to maintain required margins, we will no longer be able to make a profit from the sale of older products.
If we cannot advance our process technologies or improve our production efficiencies to a degree sufficient to maintain required margins, we will not be able to make a profit from the sale of older products.
Because our strategies and restructuring activities may involve changes to many aspects of our business, including the location of our production facilities and personnel and the potential exit of certain product lines and businesses, our ability to successfully do so depends on a number of factors, many of which are outside of our control.
Because our strategies and restructuring activities may involve changes to many aspects of our business, including the location of our production facilities and personnel and the potential exit of certain product lines and businesses, our ability to successfully execute these activities depends on a number of factors, many of which are outside of our control.
Changes in demand in these end-markets or changes that have the potential to disrupt sales activities to customers in these end-markets, can significantly impact our operating results. Additionally, the quantity and price of our products sold to customers in each end-market could decline despite continued growth in such end-markets.
Changes in demand in these end-markets (such as fluctuations in demand for EVs), or changes that have the potential to disrupt sales activities to customers in these end-markets, can significantly impact our operating results. Additionally, the quantity and price of our products sold to customers in each end-market could decline despite continued growth in such end-markets.
Foreign exchange regulations may also limit our ability to convert or repatriate foreign currency. As a result of having a lower amount of cash and cash equivalents in the United States, our financial flexibility may be reduced, which could have a material adverse effect on our ability to make interest and principal payments due under our various debt obligations.
Foreign exchange regulations may also limit our ability to convert or repatriate foreign currency. If we have a lower amount of cash and cash equivalents in the United States, our financial flexibility may be reduced, which could have a material adverse effect on our ability to make interest and principal payments due under our various debt obligations.
These types of initiatives and changes, if adopted or enacted, may increase tax uncertainty and may adversely affect our provision for income taxes, which could have a material impact on our results of operations and financial condition.
These types of initiatives and changes, as they are adopted or enacted, may increase tax uncertainty and may adversely affect our provision for income taxes, which could have a material impact on our results of operations and financial condition.
If any of these events impact our supply chain, manufacturing and product shipments could be delayed, which could materially adversely affect our business, results of operations and financial condition. In addition, disruption of transportation and distribution systems could result in reduced operational efficiency and customer service interruption.
If any of these events impact our supply chain or component costs, manufacturing and product shipments could be delayed or such events could materially adversely affect our business, results of operations and financial condition. In addition, disruption of transportation and distribution systems could result in reduced operational efficiency and customer service interruption.
Interest rates increased throughout 2022 and 2023. While interest rates have stabilized during 2024, if interest rates increase or remain at elevated levels, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
While interest rates have stabilized during 2025, if interest rates increase or remain at elevated levels, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
Should we be unable to protect our IP, competitors may develop products or technologies that duplicate our products or technologies, benefit financially from innovations for which we bore the costs of development and undercut the sales and marketing of our products, all of which could have a material adverse effect on our business and results of operations.
If we fail to, or are unable to, adequately protect our IP, competitors may develop products or technologies that duplicate our products or technologies, benefit financially from innovations for which we bore the costs of development and undercut the sales and marketing of our products, all of which could have a material adverse effect on our business and results of operations.
If we are unable to comply, or are unable to cause our suppliers to comply, with such policies or provisions or meet the requirements of our customers and investors, a customer may stop purchasing products from us or an investor may sell their shares, or parties may take legal action against us, which could harm our reputation, revenue and results of operations.
If we are unable to comply, or are unable to cause our suppliers to comply, with such policies or provisions or meet the requirements or expectations of our customers and investors, including any customers and investors that are critical of or oppose such initiatives, a customer may stop purchasing products from us or an investor may sell their shares, or parties may take legal action against us, which could harm our reputation, revenue and results of operations.
Additionally, in the event that our products fail to perform as expected or such failure of our products results in a recall, our reputation may be damaged, which could make it more difficult for us to sell our products to existing and prospective customers and could materially adversely affect our business, reputation, results of operations and financial condition.
Additionally, if our products fail to perform as expected or their failure results in a recall, our reputation may be damaged, which could make it more difficult for us to sell our products to existing and prospective customers and could materially adversely affect our business, reputation, results of operations and financial condition.
These efforts could result in significant potential risks, including failure of the systems to operate as designed, unexpected impacts on related systems or processes, potential loss or corruption of data, failures in security processes and internal controls, cost overruns, implementation delays or errors, disruption of operations, and the potential inability to meet business and reporting requirements.
These efforts, including the continued transition to and implementation of the new enterprise resource planning system and related systems, could result in significant potential risks, including failure of the systems to operate as designed, unexpected impacts on related systems or processes, potential loss or corruption of data, failures in security processes and internal controls, cost overruns, implementation delays or errors, disruption of operations, and the potential inability to meet business and reporting requirements.
These investments involve replacing existing systems, some of which are older, legacy systems that are less flexible and efficient, with successor systems; outsourcing certain technology and business processes to third-party service providers; making changes to existing systems; maintaining or enhancing legacy systems that are not currently being replaced; designing or cost effectively acquiring new systems with new functionality; or testing the use and incorporation of AI, including generative AI.
These investments involve replacing existing systems, some of which are older, legacy systems that are less flexible and efficient, with successor systems; outsourcing certain technology and business processes to third-party service providers; deploying enhanced end-to-end digital processes (which may include the use of AI); maintaining or enhancing legacy systems that are not currently being replaced; designing or cost effectively acquiring new systems with new functionality; or testing the use and incorporation of AI, including generative AI.
Changes in tax laws from international and domestic initiatives, such as the Organization for Economic Co-operation and Development's base erosion and profit shifting project and potential U.S. tax reforms, could adversely affect our future reported results of operations or the way we conduct our business.
International and domestic initiatives, such as the Organisation for Economic Co-operation and Development's base erosion and profit shifting project and potential U.S. tax reforms, could adversely affect our future reported results of operations or the way we conduct our business.
This may have the effect of delaying or preventing a takeover of our Company that would otherwise be beneficial to the holders of the 0% Notes, the 0.50% Notes, the 3.875% Notes and our common stock, which could materially decrease the value of such notes and of our common stock.
This may have the effect of delaying or preventing a takeover of our Company that would otherwise be beneficial to the holders of Outstanding Notes and our common stock, which could materially decrease the value of such notes and of our common stock.
A significant portion of our sales are to customers within the automotive industry and the industrial sector and the demand for our products depends in part on the market conditions in these end-markets. Sales into the automotive and industrial end-markets represented approximately 55% and 25% of our revenue, respectively, for the year ended December 31, 2024.
A significant portion of our sales are made to customers within the automotive industry and the industrial sector, and the demand for our products depends in part on the market conditions in these end-markets. Sales into the automotive and industrial end-markets represented approximately 51% and 28% of our revenue, respectively, for the year ended December 31, 2025.
Our extensive reliance on, and investments in, information technology systems, including reliance on third-party service providers, could have a materially adverse impact on our business. We rely extensively on information technology systems and related personnel to collect, use, retain, manage, transmit, and protect transactions and data.
Our extensive reliance on information technology systems, including reliance on third-party service providers, could have a materially adverse impact on our business, and our substantial investments in such information technology systems could result in significant potential risks and failures. We rely extensively on information technology systems and related personnel to collect, use, retain, manage, transmit, and protect transactions and data.
As with many new emerging technologies, AI presents risks and challenges and increasing legal, social and ethical concerns relating to its responsible use that could affect the adoption of AI.
As with many new emerging technologies, AI presents risks and challenges and has prompted legal, social and ethical concerns relating to its responsible use that could affect its adoption.
To the extent that we do not achieve the profitability enhancement or other anticipated benefits of strategy or restructuring initiatives, our results of operations may be materially adversely affected.
To the extent that our strategy or restructuring initiatives do not enhance our profitability or yield other anticipated benefits, our results of operations may be materially adversely affected.
Although we are not aware of any cybersecurity incidents that have materially affected or are reasonably likely to materially affect our business as of the year ended December 31, 2024, we continue to devote resources to reduce the risk of or alleviate cybersecurity breaches and vulnerabilities and those costs could be significant.
Although we are not aware of any cybersecurity incidents that have materially affected or are reasonably likely to materially affect our business as of the date of this report, we continue to devote resources to reduce the risk of or alleviate cybersecurity breaches and vulnerabilities, and those costs could be significant.
Department of Commerce could in the future add additional Chinese companies to its restricted entity list or unverified list or take other actions that could expand licensing requirements or otherwise impact the market for our products and our revenue.
Department of Commerce may add additional Chinese companies to its restricted entity list or unverified list and regulatory bodies of either country may take other actions that could expand licensing requirements or otherwise impact the market for our products and our revenue.
The legislative and regulatory framework for privacy and data protection issues worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. We collect Personally Identifiable Information ("PII") and other data as part of our business processes and activities.
We are subject to governmental laws, regulations and other legal obligations related to privacy and data protection. The legislative and regulatory framework for privacy and data protection issues worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. We collect Personally Identifiable Information ("PII") and other data as part of our business processes and activities.
In addition, the nature of our operations exposes us to the continuing risk of environmental and health and safety liabilities including: • changes in United States and international environmental or health and safety laws, regulations or policies, including, but not limited to, future laws or regulations imposed in response to climate change concerns and conflict minerals; • the manner in which environmental or health and safety laws or regulations will be enforced, administered or interpreted; • our ability to enforce and collect under indemnity agreements and insurance policies relating to environmental liabilities; • the cost of compliance with future environmental or health and safety laws or regulations or the costs associated with any future environmental claims, including the cost of clean-up of currently unknown environmental conditions; or • the cost of fines, penalties or other legal liability, should we fail to comply with environmental or health and safety laws or regulations.
In addition, the nature of our operations exposes us to the continuing risk of environmental and health and safety liabilities including: • changes in United States and international environmental or health and safety laws, regulations or policies, especially those implemented with immediate effect; • the manner in which environmental or health and safety laws or regulations will be enforced, administered or interpreted; • our ability to enforce and collect under indemnity agreements and insurance policies relating to environmental liabilities; • the cost of compliance with future environmental or health and safety laws or regulations or the costs associated with any future environmental claims, including the cost of clean-up of currently unknown environmental conditions; or • the cost of fines, penalties or other legal liability, should we fail to comply with environmental or health and safety laws or regulations.
Third-party misuse of AI applications, models, or solutions, or ineffective or inadequate AI development or deployment practices by our customers could cause harm to individuals or society and impair the public’s acceptance of AI, which would in turn adversely affect our business. We may be unable to attract and retain highly skilled personnel.
Third-party misuse of AI applications, models, or solutions, or ineffective or inadequate AI development or deployment practices by our customers could cause harm to individuals or society and impair the public’s acceptance of AI, which would in turn adversely affect our business.
We may be unable to implement certain business strategies and restructuring initiatives and any issue with the pursuit of such strategies and initiatives could materially adversely affect our business and results of operations. We may from time to time determine to implement business strategies and restructuring initiatives in order to remain competitive.
We may be unable to implement certain business strategies and restructuring initiatives and the pursuit of such strategies and initiatives could materially adversely affect our business and results of operations. We may from time to time determine to implement business strategies and restructuring initiatives.
We incur costs associated with complying with evolving environmental, health and safety laws and regulations and related disclosure obligations such as the Corporate Sustainability Reporting Directive. Failure to comply with these laws or regulations could subject us to significant costs and liabilities.
We incur costs associated with complying with evolving environmental, health and safety laws and regulations and related disclosure obligations. Failure to comply with these laws or regulations could subject us to significant costs and liabilities.
Our gross margins vary due to a variety of factors. Reduced sales and lower gross margins would materially adversely affect our business and results of operations. The semiconductor industry has experienced, and may continue to experience, significant consolidation among companies and vertical integration among customers.
Our gross margins may fluctuate across time periods and operating segments and could experience volatility or downward pressure due to a variety of factors. Reduced sales and lower gross margins would materially adversely affect our business and results of operations. The semiconductor industry has experienced, and may continue to experience, significant consolidation among companies and vertical integration among customers.
These strategies, goals and targets, and their underlying assumptions and projections, reflect our current plans and aspirations, but we may be unable to achieve them.
We periodically communicate our strategies, goals and targets related to our corporate social and environmental policies and programs . These strategies, goals and targets, and their underlying assumptions and projections, reflect our current plans and aspirations, but we may be unable to achieve them.
These provisions: • establish advance notice requirements for submitting nominations for election to the Board of Directors and for proposing matters that can be acted upon by stockholders at a meeting; • authorize the issuance of "blank check" preferred stock, which is preferred stock that our Board of Directors can create and issue without prior stockholder approval and that could be issued with voting or other rights or preferences that could impede a takeover attempt; and • require the approval by holders of at least 66 2/3% of our outstanding common stock to amend certain of these provisions in our certificate of incorporation or by-laws. 27 Although we believe these provisions make a higher third-party bid more likely by requiring potential acquirers to negotiate with our Board of Directors, these provisions apply even if an initial offer may be considered beneficial by some stockholders.
These provisions: • establish advance notice requirements for submitting nominations for election to the Board of Directors and for proposing matters that can be acted upon by stockholders at a meeting; • authorize the issuance of "blank check" preferred stock, which is preferred stock that our Board of Directors can create and issue without prior stockholder approval and that could be issued with voting or other rights or preferences that could impede a takeover attempt; and • require the approval by holders of at least 66 2/3% of our outstanding common stock to amend certain of these provisions in our certificate of incorporation or by-laws.
In addition, we are currently making, and expect to continue to make, substantial investments in our information technology systems, infrastructure and personnel, in certain cases with the assistance of strategic partners and other third-party service providers.
In addition, we are currently making, and will continue to make, substantial investments in our information technology systems, infrastructure and personnel, including a new enterprise resource planning system implemented in the third quarter of 2025, in certain cases with the assistance of strategic partners and other third-party service providers.
The automotive industry is cyclical and the industrial sector tends to thrive during a time of economic expansion, and, as a result, our customers in each end-market are sensitive to changes in general economic conditions, inflationary pressure, increases in interest rates, disruptive innovation and end-market preferences, which can adversely affect sales of our products and, correspondingly, our results of operations.
As a result, our customers in each end-market are sensitive to changes in general economic conditions, inflationary pressure, changes in interest rates, disruptive innovation and end-market preferences, any of which can adversely affect sales of our products and, correspondingly, our results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs a result, cybersecurity and data protection are key components of our long-term strategy. 29 We use various processes to inform our assessment, identification and management of risk from cybersecurity threats. Key areas of our cybersecurity risk management processes and strategy currently include: • Cross-Functional Collaboration and Coordination .
Biggest changeWe use various processes to inform our assessment, identification and management of risk from cybersecurity threats. Key areas of our cybersecurity risk management processes and strategy currently include: • Cross-Functional Collaboration and Coordination . Our Enterprise Cybersecurity Services (“ECS”) team, led by our Chief Information Security Officer (“CISO”), has first line responsibility for our cybersecurity risk management processes.
These include: ◦ our Cybersecurity Executive Council (the “Council”), which is composed of key leaders from stakeholder groups throughout the Company, including the CISO and certain members of senior management; ◦ our Enterprise Risk Management (“ERM”) team, which is responsible for evaluating and assessing overall enterprise risk, including cybersecurity risk, and advising senior management and the Board regarding our overall risk profile and priorities as they evolve; ◦ our Internal Audit Department (“IAD”), which monitors certain IT systems controls that are integrated into our larger Sarbanes-Oxley control environment; and ◦ our Cyber Incident Response Team (“CIRT”), a cross-functional team of subject matter experts from across the Company and certain third-party support providers that we have on retainer. • Ongoing Evaluation and Assessment of Systems and Processes .
These include: ◦ our Cybersecurity Executive Council (the “Council”), which is composed of key leaders from stakeholder groups throughout the Company, including the CISO and certain members of senior management; ◦ our Enterprise Risk Management (“ERM”) team, which is responsible for evaluating and assessing overall 31 enterprise risk, including cybersecurity risk, and advising senior management and the Board regarding our overall risk profile and priorities as they evolve; ◦ our Internal Audit Department (“IAD”), which monitors certain IT systems controls that are integrated into our larger Sarbanes-Oxley control environment; and ◦ our Cyber Incident Response Team (“CIRT”), a cross-functional team of subject matter experts from across the Company and certain third-party support providers that we have on retainer. • Ongoing Evaluation and Assessment of Systems and Processes .
For a discussion of risks from cybersecurity threats that could be reasonably likely to materially affect us, please see our Risk Factors discussion under the heading, “Trends, Risks and Uncertainties Related to Technology and Data Privacy” included 30 elsewhere in this Form 10-K.
For a discussion of risks from cybersecurity threats that could be reasonably likely to materially affect us, please see our Risk Factors discussion under the heading, “Trends, Risks and Uncertainties Related to Technology and Data Privacy” included elsewhere in this Form 10-K.
Specifically, under its charter, the Audit Committee is responsible for overseeing our cybersecurity posture, risk assessment, strategy and mitigation and for making recommendations to address and resolve any breaches or issues related to the protection or privacy of our data.
Specifically, under its charter, the Audit Committee is responsible for overseeing our cybersecurity posture, risk assessment, strategy and mitigation and for making recommendations 32 to address and resolve any breaches or issues related to the protection or privacy of our data.
As of December 31, 2024, we have not identified any risks from cybersecurity threats (including any previous cybersecurity incidents) that have materially affected the Company, our business strategy, our results of operations or our financial condition.
As of December 31, 2025, we have not identified any risks from cybersecurity threats (including any previous cybersecurity incidents) that have materially affected the Company, our business strategy, our results of operations or our financial condition.
Item 1C. Cybersecurity Risk Management and Strategy The secure processing, maintenance and transmission of sensitive data, including confidential and other proprietary information about our business and our employees, customers, suppliers and business partners, is important to our operations and business strategy.
Item 1C. Cybersecurity Risk Management and Strategy The secure processing, maintenance and transmission of sensitive data, including confidential and other proprietary information about our business and our employees, customers, suppliers and business partners, is important to our operations and business strategy. As a result, cybersecurity and data protection are key components of our long-term strategy.
Our CISO has over 20 years of experience in leading global security functions and strategies. Collectively, the other members of our ECS team have decades of relevant education and experience and maintain a wide range of industry certifications. We invest in regular, ongoing cybersecurity training for our ECS team.
Collectively, the other members of our ECS team have decades of relevant education and experience and maintain a wide range of industry certifications. We invest in regular, ongoing cybersecurity training for our ECS team.
The ECS team also assists with the review and approval of policies, completes benchmarking against applicable standards, maintains a cyber risk register and oversees the security awareness program. Our ECS team is led by our CISO. Our CISO reports to our CIO who, in turn, reports to our Executive Vice President and Chief Financial Officer.
The ECS team also assists with the review and approval of policies, completes benchmarking against applicable standards, maintains a cyber risk register and oversees the security awareness program. The onsemi cyber security program is based on the internationally recognized standard of ISO/IEC 27001:2022.
Our Enterprise Cybersecurity Services (“ECS”) team, led by our Chief Information Security Officer (“CISO”), has first line responsibility for our cybersecurity risk management processes. The ECS team works in partnership with other internal teams to coordinate efforts, priorities and oversight.
The ECS team works in partnership with other internal teams to coordinate efforts, priorities and oversight.
Added
The cyber program is formally certified by respective outside auditors on an annual basis and maintains certification globally. Our ECS team is led by our CISO. Our CISO reports to our CIO who, in turn, reports to our Executive Vice President and Chief Financial Officer. Our CISO has over 20 years of experience in leading global security functions and strategies.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition, due to local law restrictions, the land upon which our facilities are located in certain foreign locations is subject to varying long-term leases. See "Business — Resources" and "Business — Government Regulation" included elsewhere in this Form 10-K for further details on our properties and environmental regulation. 31
Biggest changeIn addition, due to local law restrictions, the land upon which our facilities are located in certain foreign locations is subject to varying long-term leases. See "Business — Resources" and "Business — Government Regulation" included elsewhere in this Form 10-K for further details on our properties and environmental regulation.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeSee "Legal Matters" under Note 13: ''Commitments and Contingencies'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for a description of legal proceedings and related matters. Item 4 . Mine Safety Disclosure Not applicable. PART II
Biggest changeSee "Legal Matters" under Note 13: ''Commitments and Contingencies'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for a description of legal proceedings and related matters. 33 Item 4 . Mine Safety Disclosure Not applicable. PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The following table provides information regarding repurchases of our common stock during the quarter ended December 31, 2024: Period (1) Total Number of Shares Purchased Average Price Paid per Share ($) (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs ($ in millions) ($) (3) September 28, 2024 - October 25, 2024 — $ — — $ 1,986.0 October 26, 2024 - November 22, 2024 — — — 1,986.0 November 23, 2024 - December 31, 2024 3,000,140 66.68 3,000,140 1,786.0 Total 3,000,140 66.68 3,000,140 (1) The periods represent our fiscal month start and end dates for the fourth quarter of 2024.
Biggest changeSee Note 9: ''Long-Term Debt'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K for further discussion of our Credit Agreement. 34 Issuer Purchases of Equity Securities The following table provides information regarding repurchases of our common stock during the quarter ended December 31, 2025: Period (1) Total Number of Shares Purchased Average Price Paid per Share ($) (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs ($ in millions) ($) (3) October 4, 2025 - October 31, 2025 2,956,354 $ 50.75 2,956,354 $ 711.0 November 1, 2025 - November 28, 2025 2,644,513 47.90 2,644,513 592.5 November 29, 2025 - December 31, 2025 3,178,828 54.55 3,178,828 411.0 Total 8,779,695 51.27 8,779,695 (1) The periods represent our fiscal month start and end dates for the fourth quarter of 2025.
We may pay dividends and buy back shares under the Share Repurchase Program in an unlimited amount so long as, after giving effect thereto, the consolidated total net leverage ratio (calculated in accordance with our Credit Agreement) does not exceed 2.75 to 1.00.
We may pay dividends and buy back shares under the New Share Repurchase Program in an unlimited amount so long as, after giving effect thereto, the consolidated total net leverage ratio (calculated in accordance with our Credit Agreement) does not exceed 2.75 to 1.00.
Share Repurchase Program In February 2023, the Board of Directors approved a share repurchase program (the “Share Repurchase Program”), which allows for the repurchase of our common stock from time to time through a variety of methods, including in privately negotiated transactions or open market transactions, such as pursuant to a trading plan in accordance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act or a combination of methods.
Share Repurchase Program In February 2023, the Board of Directors approved a share repurchase program (the “Share Repurchase Program”), which allowed for the repurchase of our common stock from time to time through a variety of methods, including in privately negotiated transactions or open market transactions, such as pursuant to a trading plan in accordance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act or a combination of methods.
Additionally, under a different provision, so long as no 32 default has occurred and is continuing or results therefrom, our Credit Agreement permits us to pay cash dividends to our common stockholders, buy back shares under the Share Repurchase Program, or a combination thereof, in an amount up to $350.0 million per year.
Additionally, under a different provision, so long as no default has occurred and is continuing or results therefrom, our Credit Agreement permits us to pay cash dividends to our common stockholders, buy back shares under the New Share Repurchase Program, or a combination thereof, in an amount up to $350.0 million per year.
Our outstanding debt facilities may limit the amount of dividends we are permitted to pay and share repurchases under the Share Repurchase Program (as defined below).
Our outstanding debt facilities may limit the amount of dividends we are permitted to pay and share repurchases under the Share Repurchase Program and the New Share Repurchase Program (each as defined below).
The comparison assumes $100 was invested on December 31, 2019 in shares of our common stock and in each of the indices shown and assumes that all of the dividends were reinvested. Note that past stock price performance is not necessarily indicative of future stock price performance.
The comparison assumes $100 was invested on December 31, 2020 in shares of our common stock and in both of the indices shown and assumes that all of the dividends were reinvested. Note that past stock price performance is not necessarily indicative of future stock price performance.
There were approximately $564 million in repurchases of common stock for the year ended December 31, 2023 and approximately $260 million in repurchases of common stock under the previous share repurchase program during the year ended December 31, 2022 (in each case excluding fees, commissions and other expenses).
There were approximately $650 million in repurchases of common stock for the year ended December 31, 2024 and approximately $564 million in repurchases of common stock under the previous share repurchase program during the year ended December 31, 2023 (in each case excluding fees, commissions and other expenses).
The repurchases under the Share Repurchase Program amounted to an aggregate purchase price of approximately $650 million during the year ended December 31, 2024 (excluding fees, commissions and other expenses).
The repurchases under the Share Repurchase Program amounted to an aggregate purchase price of approximately $1,375 million during the year ended December 31, 2025 (excluding fees, commissions and other expenses).
The Share Repurchase Program, which does not require us to purchase any minimum amount of our common stock, allows for repurchases up to $3.0 billion from February 8, 2023 through December 31, 2025 (exclusive of fees, commissions and other expenses).
The Share Repurchase Program, which did not require us to purchase any minimum amount of our common stock, allowed for repurchases up to $3.0 billion from February 8, 2023 through December 31, 2025 (exclusive of fees, commissions and other expenses). Any repurchases were at the Company’s discretion and subject to market conditions, the price of our shares and other factors.
During January 2025, the Company acquired 1.6 million shares for $100.0 million under the Share Repurchase Program pursuant to a 10b5-1 trading arrangement. See Note 10: ''Earnings Per Share and Equity'' of the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for further information on the Share Repurchase Program.
See Note 10: ''Earnings Per Share and Equity'' of the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for further information on the Share Repurchase Program and the New Share Repurchase Program. Item 6. [Reserved] 35
As of February 5, 2025, there were approximately 164 holders of record of our common stock and 421,421,127 shares of common stock outstanding.
As of February 4, 2026, there were approximately 151 holders of record of our common stock and 394,020,530 shares of common stock outstanding.
Any repurchases will be at the Company’s discretion and will be subject to market conditions, the price of our shares and other factors. The Share Repurchase Program may be modified, suspended or terminated by the Board of Directors at any time without prior notice.
Under the New Share Repurchase Program, which does not require the Company to purchase any minimum amount of common stock or at all, the Company may repurchase shares from January 1, 2026 through December 31, 2028. The New Share Repurchase Program may be modified, suspended or terminated by the Board of Directors at any time without prior notice.
Removed
See Note 9: ''Long-Term Debt'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K for further discussion of our Credit Agreement.
Added
New Share Repurchase Program In November 2025, the Board of Directors approved a new Share Repurchase Program (the "New Share Repurchase Program") under which the Company may repurchase up to an aggregate of $6.0 billion of the Company's common stock (exclusive of fees, commissions and other expenses).
Added
Through February 4, 2026, the Company acquired 2.9 million shares for $175.6 million under the New Share Repurchase Program pursuant to a 10b5-1 trading arrangement.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeKey Financing and Capital Events Overview We continually evaluate our debt and capital structure and, when appropriate, we have completed various measures to secure liquidity, repurchase shares of our common stock, reduce interest costs, amend or replace existing key financing arrangements and, in some cases, extend a portion of our debt maturities to continue to provide us additional operating flexibility. 2024 Financing Events • Repurchases of approximately 9.1 million shares of common stock for an aggregate purchase price of approximately $650 million under the Share Repurchase Program. 40 2023 Financing Events • Issuance of $1.5 billion of 0.50% Notes on February 28, 2023, the net proceeds of which were used to repay $1,086.0 million of the existing indebtedness under the Term Loan "B" Facility, the related transaction fees and expenses and to pay approximately $171.5 million net cost of the related convertible note hedges. • Entering into a new Credit Agreement consisting of a $1.5 billion Revolving Credit Facility and draw-down of $375.0 million to repay the entire outstanding balance under the Revolver due 2024 in the second quarter of 2023. • Repurchases of approximately 7.6 million shares of common stock for an aggregate purchase price of approximately $564 million under the Share Repurchase Program. • Repayment of the 1.625% Notes amounting to $119.6 million in cash upon maturity and issuance of approximately 4.5 million shares of common stock to settle the excess over the principal. 2022 Financing Events • Draw down of $500.0 million on the Revolver due 2024 and partial repayment of the outstanding balance on the Term Loan "B" Facility and corresponding write off of $7.3 million of unamortized debt discount and issuance costs. • Repurchases of approximately 4.0 million shares of common stock for an aggregate purchase price of approximately $260 million under the previous share repurchase program. • Settlement with certain holders of the 1.625% Notes to repurchase or exchange, as applicable, $16.0 million in aggregate principal amount of the 1.625% Notes for a total consideration of $16.0 million in cash and 552,000 shares of common stock. • Entry into the Tenth Amendment to the Prior Credit Agreement to transition the interest rate base from LIBOR to Term SOFR.
Biggest changeKey Financing and Capital Events Overview We continually evaluate our debt and capital structure and, when appropriate, we have completed various measures to secure liquidity, repurchase shares of our common stock, reduce interest costs, amend or replace existing key financing arrangements and, in some cases, extend a portion of our debt maturities to continue to provide us additional operating flexibility. 46 2025 Financing Events • Repayment of $375.0 million of borrowings on the Revolving Credit Facility. • Repurchases of approximately 27.9 million shares of common stock for an aggregate purchase price of approximately $1,375 million, excluding fees, commissions, and excise tax, under the Share Repurchase Program. 2024 Financing Events • Repurchases of approximately 9.1 million shares of common stock for an aggregate purchase price of approximately $650 million under the Share Repurchase Program. 2023 Financing Events • Issuance of $1.5 billion of 0.50% Notes on February 28, 2023, the net proceeds of which were used to repay $1,086.0 million of the existing indebtedness under the Term Loan "B" Facility, the related transaction fees and expenses and to pay approximately $171.5 million net cost of the related convertible note hedges. • Entering into a new Credit Agreement consisting of a $1.5 billion Revolving Credit Facility and draw-down of $375.0 million to repay the entire outstanding balance under the Revolver due 2024 in the second quarter of 2023. • Repurchases of approximately 7.6 million shares of common stock for an aggregate purchase price of approximately $564 million under the Share Repurchase Program. • Repayment of the 1.625% Notes amounting to $119.6 million in cash upon maturity and issuance of approximately 4.5 million shares of common stock to settle the excess over the principal.
Actuarial gains on pension plans were $12.2 million compared to losses of $4.0 million during 2023 and fluctuations in foreign currencies resulting in increased transaction gains. Income Tax Provision We recorded an income tax provision of $262.8 million and $350.2 million in 2024 and 2023, respectively, representing effective tax rates of 14.3% and 13.8%.
Actuarial gains on pension plans were $12.2 million in 2024 compared to losses of $4.0 million during 2023 and fluctuations in foreign currencies resulting in increased transaction gains. Income Tax Provision We recorded an income tax provision of $262.8 million and $350.2 million in 2024 and 2023, respectively, representing effective tax rates of 14.3% and 13.8%.
See Note 9: ''Long-Term Debt'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information.
See Note 9: ''Long-Term Debt'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for additional information.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following discussion in conjunction with our audited historical consolidated financial statements, including the notes thereto, which are included elsewhere in this Form 10-K. Management's Discussion and Analysis of Financial Condition and Results of Operations contains statements that are forward-looking.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following discussion in conjunction with our audited consolidated financial statements, including the notes thereto, which are included elsewhere in this Form 10-K. Management's Discussion and Analysis of Financial Condition and Results of Operations contains statements that are forward-looking.
We apply a five-step approach in determining the amount and timing of revenue to be recognized: (i) identifying the contract with a customer; (ii) identifying the performance obligations in the contract; (iii) determining the transaction price; (iv) allocating the transaction price to the performance obligations in the contract; and (v) recognizing revenue when the 41 performance obligation is satisfied.
We apply a five-step approach in determining the amount and timing of revenue to be recognized: (i) identifying the contract with a customer; (ii) identifying the performance obligations in the contract; (iii) determining the transaction price; (iv) allocating the transaction price to the performance obligations in the contract; and (v) recognizing revenue when the performance obligation is satisfied.
Changes in the recognition or measurement of uncertain tax positions could result in material increases or decreases in income tax expense in the period in which the change is made, which could have a material impact on our effective tax rate. Business Combinations.
Changes in the recognition or measurement 48 of uncertain tax positions could result in material increases or decreases in income tax expense in the period in which the change is made, which could have a material impact on our effective tax rate. Business Combinations.
For tax positions that are more likely than not to be sustained upon audit, the second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon settlement. No tax benefit is recognized for tax 42 positions that are not more likely than not to be sustained.
For tax positions that are more likely than not to be sustained upon audit, the second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon settlement. No tax benefit is recognized for tax positions that are not more likely than not to be sustained.
For additional information, see Note 16: ''Income Taxes'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K. 38 Liquidity and Capital Resources Overview Our principal sources of liquidity are cash on hand, cash generated from operations, available borrowings under our Revolving Credit Facility as well as new debt and/or equity issuances.
For additional information, see Note 16: ''Income Taxes'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K. 44 Liquidity and Capital Resources Overview Our principal sources of liquidity are cash on hand, cash generated from operations, available borrowings under our Revolving Credit Facility as well as new debt and/or equity issuances.
Significant estimates have been used by management in conjunction with the following: (i) calculation of future payouts for customer incentives and amounts subject to allowances and returns; (ii) valuation and obsolescence relating to inventories; (iii) measurement of valuation allowances against deferred tax assets, and evaluations of uncertain tax positions; (iv) assumptions used in business combinations; and (v) testing for impairment of long-lived assets and goodwill.
Significant estimates have been used by management in conjunction with the following: (i) calculation of future payouts for customer incentives and amounts subject to allowances and returns; (ii) valuation and obsolescence relating to inventories; (iii) measurement of valuation allowances against deferred tax assets, and evaluations of uncertain tax positions; (iv) assumptions used in business combinations and the valuation of assets held-for-sale; and (v) testing for impairment of long-lived assets and goodwill.
We use estimates and assumptions in allocating the purchase price of acquired business by utilizing established valuation techniques appropriate for the technology industry to record the acquired assets and liabilities at fair value. We utilize the income approach, cost approach or market approach, depending upon which approach is the most appropriate based on the nature and reliability of available data.
We use estimates and assumptions in allocating the purchase price of acquired businesses by utilizing established valuation techniques appropriate for the technology industry to record the acquired assets and liabilities at fair value. We utilize the income approach, cost approach or market approach, depending upon which approach is the most appropriate based on the nature and reliability of available data.
We consider historical rates and current market conditions when determining the discount and long-term growth rates to use in its analysis. We consider other valuation methods, such as the cost approach or market approach, if it is determined that these methods provide a more representative approximation of fair value.
We consider historical rates and current market conditions when determining the discount and long-term growth rates to use in our analysis. We consider other valuation methods, such as the cost approach or market approach, if it is determined that these methods provide a more representative approximation of fair value.
We evaluate our goodwill for potential impairment annually during the fourth quarter and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable.
Impairment of Goodwill and Long-Lived Assets: Goodwill We evaluate our goodwill for potential impairment annually during the fourth quarter and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable.
We have taken, and continue to take actions, including but not limited to, exiting product lines that do not enhance gross margin or satisfy strategic objectives and aligning internal manufacturing capacity and resources to external demand.
We have taken, and continue to take actions, including but not limited to, exiting product lines that do not enhance gross margin or satisfy strategic objectives. We made meaningful progress in aligning internal manufacturing capacity and resources to external demand.
Determining the fair value of acquired technology assets is judgmental in nature and requires the use of significant estimates and assumptions, including the discount rate, revenue growth rates, projected gross margins, and estimated research and development expenses. Impairment of Goodwill and Long-Lived Assets.
Determining the fair value of acquired technology assets is judgmental in nature and requires the use of significant estimates and assumptions, including the discount rate, revenue growth rates, projected gross margins, and estimated research and development expenses.
See Note 7: ''Restructuring, Asset Impairments and Other Charges, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for information relating to our most recent cost-saving initiatives. Results of Operations A discussion of our results of operations for the year ended December 31, 2024 compared to December 31, 2023 is included below.
See Note 7: ''Restructuring, Asset Impairments and Other, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K for information relating to our most recent cost-saving initiatives. 36 Results of Operations Comparison of the years ended December 31, 2025 and 2024 A discussion of our results of operations for the year ended December 31, 2025 compared to December 31, 2024 is included below.
In 2025, based on current plans, we expect capital expenditures to be approximately 5% of revenue. Financing Activities Our cash flows used in financing activities were $683.8 million, $686.5 million and $370.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.
In 2026, based on current plans, we expect capital expenditures to be approximately 5% of revenue. Financing Activities Our cash flows used in financing activities were $1,763.8 million, $683.8 million and $686.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Our operating cash flows for the year ended December 31, 2024 decreased by $71.1 million, or 3.6%, compared to the year ended December 31, 2023 and was primarily attributable to a reduction in net income driven by lower end-market demand for our products partially offset by the timing of cash receipts and payments related to working capital balances.
Our operating cash flows for the year ended December 31, 2025 decreased by $146.6 million, or 7.7%, compared to the year ended December 31, 2024 and was primarily attributable to a reduction in net income driven by lower end-market demand for our products partially offset by the timing of cash receipts and payments related to working capital balances.
Operating Activities Our long-term cash generation is dependent on our ability to generate cash from our operations. Our cash flows from operating activities were $1,906.4 million, $1,977.5 million and $2,633.1 million for the years ended December 31, 2024, 2023 and 2022 , respectively.
Operating Activities Our long-term cash generation is dependent on our ability to generate cash from our operations. Our cash flows from operating activities were $1,759.8 million, $1,906.4 million and $1,977.5 million for the years ended December 31, 2025, 2024 and 2023 , respectively.
For a discussion and comparison of the results of our operations for the year ended December 31, 2023 with the year ended December 31, 2022, refer to "Management's Discussion and Analysis of Financial Conditions and Results of Operations" in our Form 10-K for the year ended December 31, 2023 filed with the SEC on February 5, 2024. 34 Operating Results The following table summarizes certain information relating to our operating results that has been derived from our audited consolidated financial statements (in millions): Year ended December 31, 2024 2023 Change Revenue $ 7,082.3 $ 8,253.0 $ (1,170.7) Cost of revenue 3,866.2 4,369.5 (503.3) Gross profit 3,216.1 3,883.5 (667.4) Operating expenses: Research and development 612.7 577.3 35.4 Selling and marketing 273.5 279.1 (5.6) General and administrative 376.3 362.4 13.9 Amortization of acquisition-related intangible assets 52.0 51.1 0.9 Restructuring, asset impairments and other charges, net 133.9 74.9 59.0 Total operating expenses 1,448.4 1,344.8 103.6 Operating income 1,767.7 2,538.7 (771.0) Other income (expense), net: Interest expense (62.3) (74.8) 12.5 Interest income 111.4 93.1 18.3 Loss on debt refinancing and prepayment — (13.3) 13.3 Loss on divestiture of businesses — (0.7) 0.7 Other income (expense), net 20.6 (7.2) 27.8 Other income (expense), net 69.7 (2.9) 72.6 Income before income taxes 1,837.4 2,535.8 (698.4) Income tax provision (262.8) (350.2) 87.4 Net income 1,574.6 2,185.6 (611.0) Less: Net income attributable to non-controlling interest (1.8) (1.9) 0.1 Net income attributable to ON Semiconductor Corporation $ 1,572.8 $ 2,183.7 $ (610.9) 35 The following table summarizes certain information relating to our segment results (in millions): 2024 As a % of Total 2023 (1) As a % of Total Dollar Change Revenue: PSG $ 3,348.2 47.3 % $ 3,880.4 47.0 % $ (532.2) AMG 2,609.1 36.8 % 3,057.1 37.0 % (448.0) ISG 1,125.0 15.9 % 1,315.5 16.0 % (190.5) Total $ 7,082.3 100.0 % $ 8,253.0 100.0 % $ (1,170.7) Cost of revenue: PSG $ 1,963.8 50.8 % $ 2,058.5 47.1 % $ (94.7) AMG 1,302.8 33.7 % 1,635.8 37.4 % (333.0) ISG 599.6 15.5 % 675.2 15.5 % (75.6) Total $ 3,866.2 100.0 % $ 4,369.5 100.0 % $ (503.3) Gross profit: (2) PSG $ 1,384.4 41.3 % $ 1,821.9 47.0 % $ (437.5) AMG 1,306.3 50.1 % 1,421.3 46.5 % (115.0) ISG 525.4 46.7 % 640.3 48.7 % (114.9) Total $ 3,216.1 45.4 % $ 3,883.5 47.1 % $ (667.4) (1) During the first quarter of 2024, the Company reorganized certain reporting units and its segment reporting structure.
Operating Results The following table summarizes certain information relating to our operating results that has been derived from our audited consolidated financial statements (in millions): Year ended December 31, 2024 2023 Change Revenue $ 7,082.3 $ 8,253.0 $ (1,170.7) Cost of revenue 3,866.2 4,369.5 (503.3) Gross profit 3,216.1 3,883.5 (667.4) Operating expenses: Research and development 612.7 577.3 35.4 Selling and marketing 273.5 279.1 (5.6) General and administrative 376.3 362.4 13.9 Amortization of intangible assets 52.0 51.1 0.9 Restructuring, asset impairments and other, net 133.9 74.9 59.0 Total operating expenses 1,448.4 1,344.8 103.6 Operating income 1,767.7 2,538.7 (771.0) Other income (expense), net: Interest expense (62.3) (74.8) 12.5 Interest income 111.4 93.1 18.3 Loss on debt refinancing and prepayment — (13.3) 13.3 Loss on divestiture of businesses — (0.7) 0.7 Other income (expense), net 20.6 (7.2) 27.8 Other income (expense), net 69.7 (2.9) 72.6 Income before income taxes 1,837.4 2,535.8 (698.4) Income tax provision (262.8) (350.2) 87.4 Net income 1,574.6 2,185.6 (611.0) Less: Net income attributable to non-controlling interest (1.8) (1.9) 0.1 Net income attributable to ON Semiconductor Corporation $ 1,572.8 $ 2,183.7 $ (610.9) 41 The following table summarizes certain information relating to our segment results (in millions): 2024 As a % of Total 2023 As a % of Total Dollar Change Revenue: PSG $ 3,348.2 47.3 % $ 3,880.4 47.0 % $ (532.2) AMG 2,609.1 36.8 % 3,057.1 37.0 % (448.0) ISG 1,125.0 15.9 % 1,315.5 16.0 % (190.5) Total $ 7,082.3 100.0 % $ 8,253.0 100.0 % $ (1,170.7) Cost of revenue: PSG $ 1,963.8 50.8 % $ 2,058.5 47.1 % $ (94.7) AMG 1,302.8 33.7 % 1,635.8 37.4 % (333.0) ISG 599.6 15.5 % 675.2 15.5 % (75.6) Total $ 3,866.2 100.0 % $ 4,369.5 100.0 % $ (503.3) Gross profit: (1) PSG $ 1,384.4 41.3 % $ 1,821.9 47.0 % $ (437.5) AMG 1,306.3 50.1 % 1,421.3 46.5 % (115.0) ISG 525.4 46.7 % 640.3 48.7 % (114.9) Total $ 3,216.1 45.4 % $ 3,883.5 47.1 % $ (667.4) (1) Gross profit margin as a percent of respective segment revenue balances.
In the near term, we expect to fund our cash requirements by utilizing any or a combination of these principal sources. Our cash and cash equivalents and short-term investments were approximately $2,691.3 million and $300.0 million, respectively, as of December 31, 2024 and our Revolving Credit Facility had approximately $1.1 billion available for future borrowings as of December 31, 2024.
In the near term, we expect to fund our cash requirements by utilizing any or a combination of these principal sources. Our cash and cash equivalents and short-term investments were approximately $2,147.6 million and $400.0 million, respectively, as of December 31, 2025 and our Revolving Credit Facility had approximately $1.5 billion available for future borrowings as of December 31, 2025.
Management of our assets and liabilities, including both working capital and long-term assets and liabilities, also influences our operating cash flows. 39 Investing Activities Our cash flows used in investing activities were $1,009.8 million, $1,737.9 million and $705.4 million for the years ended December 31, 2024, 2023 and 2022 , respectively.
Management of our assets and liabilities, including both working capital and long-term assets and liabilities, also influences our operating cash flows. 45 Investing Activities Our cash flows used in investing activities were $538.5 million, $1,009.8 million and $1,737.9 million for the years ended December 31, 2025, 2024, and 2023 , respectively.
We continue to evaluate cost-saving initiatives to be able to align our overall cost structure, capital investments and other expenditures with our expected revenue, spending and capacity levels to help offset softening demand, increased manufacturing and operating costs.
We intend to continue these actions during 2026. We continue to implement cost-saving initiatives to be able to align our overall cost structure, capital investments and other expenditures with our expected revenue, spending and capacity levels to help offset softening demand and increased manufacturing and operating costs.
Charges in 2023 related primarily to the business realignment efforts during 2023. For additional information, see Note 7: ''Restructuring, Asset Impairments and Other Charges, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K.
Amounts incurred during 2024 primarily represent severance and asset impairment charges associated with the 2024 business realignment efforts. Charges in 2023 related primarily to the business realignment efforts during 2023. For additional information, see Note 7: ''Restructuring, Asset Impairments and Other Charges, net'' in the notes to our audited consolidated financial statements included elsewhere in this Form 10-K.
For further details, please read "Management's Discussion and Analysis of Financial Condition and Results of Operations" in its entirety. onsemi Results Our revenue for the year ended December 31, 2024 was $7,082.3 million, representing a decrease of 14.2% from $8,253.0 million for the year ended December 31, 2023.
For further details, please read "Management's Discussion and Analysis of Financial Condition and Results of Operations" in its entirety. onsemi Results Our revenue for the year ended December 31, 2025 was $5,995.4 million, representing a decrease of 15.3% from $7,082.3 million for the year ended December 31, 2024.
Revenue from ISG Revenue from ISG decreased by $190.5 million, or approximately 14.5%, during 2024 compared to 2023, which was driven by a decrease in revenue from our Industrial and Consumer Solutions Division and Automotive Sensing Division of $107.8 million and $82.7 million, respectively, primarily due to the decrease in demand in the automotive and industrial end-markets . 36 Revenue by Geographic Location Revenue by geographic location, based on sales billed from the respective country or regions, was as follows (dollars in millions): 2024 As a % of Revenue (1) 2023 As a % of Revenue (1) Hong Kong $ 1,779.3 25.1 % $ 2,168.6 26.3 % Singapore 1,733.2 24.5 % 1,938.8 23.5 % United Kingdom 1,637.8 23.1 % 1,753.4 21.2 % United States 1,307.5 18.5 % 1,573.7 19.1 % Other 624.5 8.8 % 818.5 9.9 % Total Revenue $ 7,082.3 $ 8,253.0 (1) Certain of the amounts may not total due to rounding of individual amounts.
This was driven by a decrease in revenue of $68.5 million, $90.2 million and $31.8 million in the automotive, industrial and other end-markets, respectively. 42 Revenue by Geographic Location Revenue by geographic location, based on sales billed from the respective country or region, was as follows (dollars in millions): 2024 As a % of Revenue (1) 2023 As a % of Revenue (1) Hong Kong $ 1,779.3 25.1 % $ 2,168.6 26.3 % Singapore 1,733.2 24.5 % 1,938.8 23.5 % United Kingdom 1,637.8 23.1 % 1,753.4 21.2 % United States 1,307.5 18.5 % 1,573.7 19.1 % Other 624.5 8.8 % 818.5 9.9 % Total Revenue $ 7,082.3 $ 8,253.0 (1) Certain of the amounts may not total due to rounding of individual amounts.
PSG gross margin decreased by 5.6 percentage points to 41.3% from 47.0%, primarily as a result of the decline in volume, underutilization of our manufacturing facilities, and the related impact of unfavorable product mix.
PSG gross profit decreased by $437.5 million, primarily driven by the decline in sales volume in the automotive and industrial end-markets. PSG gross margin decreased by 5.7 percentage points to 41.3% from 47.0%, primarily as a result of the decline in volume, underutilization of our manufacturing facilities, and the related impact of unfavorable product mix.
During 2024, we reported net income attributable to onsemi of $1,572.8 million compared to $2,183.7 million in 2023. Our operating income totaled $1,767.7 million during 2024 compared to $2,538.7 million during 2023. Our gross margin decreased by approximately 170 basis points to 45.4% in 2024 from 47.1% in 2023.
During 2025, we reported net income attributable to onsemi of $121.0 million compared to $1,572.8 million in 2024. Our operating income totaled $84.2 million during 2025 compared to $1,767.7 million during 2024. Our gross margin decreased by approximately 1,230 basis points to 33.1% in 2025 from 45.4% in 2024.
Restructuring, Asset Impairments and Other Charges, net Restructuring, asset impairments and other charges, net was $133.9 million and $74.9 million for 2024 and 2023, respectively, representing an increase of $59.0 million. Amounts incurred during 2024 primarily represent severance and asset impairment charges associated with the 2024 business realignment efforts.
Restructuring, Asset Impairments and Other Charges, net Restructuring, asset impairments and other charges, net was $666.9 million and $133.9 million for 2025 and 2024, respectively, representing an increase of $533.0 million. Amounts incurred during 2025 primarily represent severance and asset impairment charges associated with the 2025 Manufacturing Realignment Program. Charges in 2024 related primarily to the 2024 business realignment efforts.
During the years ended December 31, 2024, 2023 and 2022, we paid $694.0 million, $1,539.1 million and $1,036.0 million, respectively, for capital expenditures. Our capital expenditures as a percent of revenue for the years ended December 31, 2024, 2023 and 2022 was approximately 10%, 19% and 12%, respectively.
During the years ended December 31, 2025, 2024, and 2023, we paid $341.2 million, $694.0 million and $1,539.1 million, respectively, for capital expenditures. Cash paid towards capital expenditures as a percent of revenue for the years ended December 31, 2025, 2024, and 2023 was approximately 6%, 10%, and 19%, respectively.
We continually apply our best judgment when applying these impairment rules to determine the timing of the impairment test, the undiscounted cash flows used to assess impairments and the fair value of an impaired asset group.
Judgment is used when applying these impairment rules to determine the timing of the impairment test, the undiscounted cash flows used to assess impairments and the fair value of the asset group.
Selling and Marketing Selling and marketing expenses were $273.5 million and $279.1 million, or approximately 4% and 3% of revenue for 2024 and 2023, respectively, representing a decrease of $5.6 million, or approximately 2% year-over-year.
Selling and Marketing Selling and marketing expenses were $273.5 million and $279.1 million, or approximately 4% and 3% of revenue for 2024 and 2023, respectively, representing a decrease of $5.6 million, or approximately 2% year-over-year. The decrease was primarily related to a decrease in sales commissions and variable compensation.
For sales agreements, we have identified the promise to transfer products, each of which is distinct, to be the performance obligation. For product development agreements, we have identified the completion of a service defined in the agreement to be the performance obligation.
Substantially all of our revenue is recognized at the time control of the products transfers to the customer. For sales agreements, we have identified the promise to transfer products, each of which is distinct, to be the performance obligation. For product development agreements, we have identified the completion of a service defined in the agreement to be the performance obligation.
AMG gross margin increased by 3.6 percentage points to 50.1% from 46.5%, primarily due to the reduction in the lower-margin manufacturing services revenue at our EFK location. ISG gross profit decreased by $114.9 million, primarily driven by the decline in sales volume from existing products.
AMG gross profit decreased by $115.0 million, primarily driven by the decline in sales volume in the automotive, industrial, and other end-markets. AMG gross margin increased by 3.6 percentage points to 50.1% from 46.5%, primarily due to the reduction in the lower-margin manufacturing services revenue at our EFK location.
The decrease was primarily related to a decrease in sales commissions and variable compensation. 37 General and Administrative General and administrative expenses were $376.3 million and $362.4 million, or approximately 5% and 4% of revenue for 2024 and 2023, respectively, representing an increase of $13.9 million, or approximately 4% year-over-year.
General and Administrative General and administrative expenses were $376.3 million and $362.4 million, or approximately 5% and 4% of revenue for 2024 and 2023, respectively, representing an increase of $13.9 million, or approximately 4% year-over-year.
Sources and Uses of Cash The following are the significant sources and uses of cash during 2024: • Cash flows from operating activities of $1,906.4 million . • Purchase of property, plant & equipment of $694.0 million. • Repurchases of approximately 9.1 million shares of common stock for an aggregate purchase price of approximately $650 million under the Share Repurchase Program.
Sources and Uses of Cash The following are the significant sources and uses of cash during 2025: • Cash flows from operating activities of $1,759.8 million . • Payments for property, plant & equipment of $341.2 million. • Repurchases of approximately 27.9 million shares of common stock for an aggregate purchase price of approximately $1,375 million under the Share Repurchase Program. • Repayment of $375.0 million of borrowings on the Revolving Credit Facility.
The decrease of $728.1 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to a decrease in capital expenditures and payments for the acquisition of our EFK location during the year ended 2023, partially offset by the net impact of purchases and maturities of short-term investments.
The decrease of $471.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily attributable to a significant decrease in capital expenditures, the net impact of purchases and maturities of short-term investments.
ISG gross margin decreased 2.0 percentage points to 46.7% from 48.7%, primarily driven by lower sales volumes and the related impact of the underutilization of our manufacturing facilities, along with unfavorable changes in product mix.
ISG gross profit decreased by $114.9 million, primarily driven by the decline in sales volume in the automotive and industrial end-markets. ISG gross margin decreased 2.0 percentage points to 46.7% from 48.7%, primarily driven by lower sales volumes and the related impact of unfavorable product mix.
Actual results could differ materially because of the factors discussed in "Risk Factors" and elsewhere in this Form 10-K. 33 Executive Overview This executive overview presents summarized information regarding our business and operating trends only.
These statements are based on current expectations and assumptions that are subject to risk, uncertainties, and other factors and speak only as of the filing date. Actual results could differ materially because of the factors discussed in "Risk Factors" and elsewhere in this Form 10-K. Executive Overview This executive overview presents summarized information regarding our business and operating trends only.
Debt As of December 31, 2024 , we were in compliance with the indentures relating to our 0% Notes, 0.50% Notes and 3.875% Notes and with the financial covenants included in the Credit Agreement.
See Part I, Item 1A "Risk Factors" included elsewhere in this Form 10-K for additional information related to liquidity matters. Debt As of December 31, 2025 , we were in compliance with the indentures relating to our 0% Notes, 0.50% Notes and 3.875% Notes and with the financial covenants included in the Credit Agreement.
The determination of projected end-user demand requires the use of estimates and assumptions related to projected unit sales for each product. These provisions can influence our results from operations.
The determination of projected end‑user demand requires updated assumptions regarding customer requirements, market conditions, product transition plans, projected unit sales, and impacts from restructuring‑related strategic changes. These provisions can influence our results from operations.
As of December 31, 2024, there was outstanding $804.9 million aggregate principal amount of the 0% Notes, $1,500.0 million aggregate principal amount of the 0.50% Notes and $700.0 million aggregate principal amount of 3.875% Notes. The associated interest expense related to our indebtedness will continue to have a significant impact on our results of operations.
As of December 31, 2025, there was outstanding $804.9 million aggregate principal amount of the 0% Notes, $1,500.0 million aggregate principal amount of the 0.50% Notes and $700.0 million aggregate principal amount of 3.875% Notes.
Revenue from our Multi-Market Power Division, Industrial Power Division and Automotive Power Division decreased by $250.8 million, $162.2 million and $119.1 million, respectively, primarily driven by a decrease in demand in the automotive and industrial end-markets. Revenue from AMG Revenue from AMG decreased by $448.0 million, or approximately 14.7%, during 2024 compared to 2023.
Revenue from PSG Revenue from PSG decreased by $532.2 million, or approximately 13.7%, during 2024 compared to 2023. This was driven by a decrease in revenue of $168.3 million, $267.7 million and $96.2 million in the automotive, industrial and other end-markets, respectively. Revenue from AMG Revenue from AMG decreased by $448.0 million, or approximately 14.7%, during 2024 compared to 2023.
Gross Profit and Gross Margin Gross profit was $3,216.1 million and $3,883.5 million for 2024 and 2023, respectively, representing a decrease of $667.4 million or approximately 17.2%. This was primarily due to the decline in sales volume in both our existing products and new products which negatively impacted gross profit by approximately $630 million and $122 million, respectively.
Gross Profit and Gross Margin Gross profit was $3,216.1 million and $3,883.5 million for 2024 and 2023, respectively, representing a decrease of $667.4 million or approximately 17.2%.
The decrease from 2023 to 2024 of $1,170.7 million, or 14.2%, w as attributable to lower sales volumes across all segments, which are further explained below. We had one customer, a distributor, whose revenue accounted for approximately 10% of our total revenue for the year ended December 31, 2024.
Revenue Revenue was $7,082.3 million and $8,253.0 million for 2024 and 2023, respectively. The decrease from 2023 to 2024 of $1,170.7 million, or 14.2%, w as attributable primarily to lower sales volumes across all segments, which are further explained below.
Amortization of Acquisition-Related Intangible Assets Amortization of acquisition-related intangible assets was $52.0 million and $51.1 million for 2024 and 2023, respectively, representing an increase of $0.9 million, or approximately 2%, year-over-year. Expenses were consistent between periods as there were no significant acquisitions or divestitures.
Expenses were consistent between periods as there were no significant acquisitions or divestitures. Restructuring, Asset Impairments and Other Charges, net Restructuring, asset impairments and other charges, net was $133.9 million and $74.9 million for 2024 and 2023, respectively, representing an increase of $59.0 million.
Business and Macroeconomic Environment The semiconductor industry has traditionally been highly cyclical, has often experienced significant downturns in connection with, or in anticipation of, declines in general economic conditions. During 2024, the semiconductor industry continued to experience a softening demand and uncertainty due to macroeconomic factors and the geopolitical environment.
See discussion under "Results of Operations" for the reasons for the fluctuations year-over-year. Business and Macroeconomic Environment The semiconductor industry has traditionally been highly cyclical, and has often experienced significant downturns in connection with, or in anticipation of, declines in general economic conditions.
The increase was primarily due to increased consulting fees associated with information technology initiatives partially offset by a decrease in the bad debt provision with a strategic business partner which was recorded in the prior year.
The increase was primarily due to increased consulting fees associated with information technology initiatives partially offset by a decrease in the bad debt provision with a strategic business partner which was recorded in the prior year. 43 Other Operating Expenses Amortization of Intangible Assets Amortization of acquisition-related intangible assets was $52.0 million and $51.1 million for 2024 and 2023, respectively, representing an increase of $0.9 million, or approximately 2%, year-over-year.
Impairment losses, if applicable, are measured as the amount by which the carrying value of an asset group exceeds its fair value and are recognized in operating results.
A potential impairment charge is evaluated when the undiscounted expected cash flows derived from an asset group are less than its carrying amount. Impairment losses, if applicable, are measured as the amount by which the carrying value of an asset group exceeds its fair value.
We allocate the transaction price to each distinct product based on its relative stand-alone selling price. In determining the transaction price, we evaluate whether the price is subject to refund or adjustment to determine the net consideration to which we expect to be entitled.
We allocate the transaction price to each distinct product based on its relative stand-alone selling price.
We evaluate the recoverability of the carrying amount of our property, plant and equipment and intangible assets, whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be fully recoverable. Impairment is first assessed when the undiscounted expected cash flows derived for an asset group are less than its carrying amount.
Long-Lived Assets Held and Used We evaluate the recoverability of the carrying amount of long-lived assets whenever events or changes in circumstances indicate that the carrying value of an asset group may not be fully recoverable.
We recognize revenue when we satisfy a performance obligation in an amount reflecting the consideration to which we expect to be entitled. Substantially all of our revenue is recognized at the time control of the products transfers to the customer.
In determining the transaction price, we evaluate whether the price is subject to refund or adjustment to determine the net consideration to which we expect to be entitled. 47 We recognize revenue when we satisfy a performance obligation in an amount reflecting the consideration to which we expect to be entitled.
We used cash for share repurchases of $654.1 million for the year ended December 31, 2024 compared to $564.2 million in 2023. Additionally, during the year ended December 31, 2023, we had net cash outflows related to the establishment of our new Credit Agreement.
We used cash to repay $375.0 million of borrowings on the Revolving Credit Facility and for share repurchases of $1,377.6 million for the year ended December 31, 2025 compared to $654.1 million in 2024.
There was no customer whose revenue exceeded 10% of total revenue for the year ended December 31, 2023. Revenue from PSG Revenue from PSG decreased by $532.2 million, or approximately 13.7%, during 2024 compared to 2023.
We had one customer, a distributor, whose revenue accounted for approximately 11% and 10% of the total revenue for the years ended December 31, 2025 and 2024, respectively, with sales across all reportable segments. Revenue from PSG Revenue from PSG decreased by $543.1 million, or approximately 16.2%, during 2025 compared to 2024.
AMG gross profit decreased by $115.1 million, primarily driven by the decline in sales volume from existing products, which negatively impacted gross profit by approximately $200 million, partially offset by improved gross profit of approximately $85 million from the lower-margin manufacturing services at our EFK location.
AMG gross profit decreased by $149.8 million, primarily driven by the decline in sales volume in the automotive and industrial end-markets. AMG gross margin increased by 1.0 percentage point to 51.1% from 50.1%, primarily due to the reduction in the lower-margin manufacturing services revenue at our EFK location.
During January 2025, we acquired 1.6 million shares for $100.0 million under the Share Repurchase Program, subject to a 10b5-1 trading arrangement. We expect to continue to opportunistically repurchase under our Share Repurchase Program subject to market conditions, the price of our shares and other factors (including liquidity needs).
We expect to continue to opportunistically repurchase our shares of common stock under our New Share Repurchase Program subject to market conditions, the price of our shares and other factors (including liquidity needs). The New Share Repurchase Program may be modified, suspended or terminated by the Board of Directors at any time without prior notice.
The decrease in our operating results was primarily due to decreased demand in our automotive and industrial end-markets resulting in lower sales volumes and the corresponding underutilization of our manufacturing facilities. See discussion under "Results of Operations" for the reasons for the fluctuations year-over-year.
Our operating results were significantly impacted by restructuring, asset impairment and other charges resulting from our 2025 Manufacturing Realignment Program. See Note 7: ''Restructuring, Asset Impairments and Other, net'' for additional information. We also continued to experience decreased demand in our automotive and industrial end-markets resulting in lower sales volumes and the corresponding underutilization of our manufacturing facilities.
We are monitoring the economic environment and related forecasts for indicators that would suggest the global economic slowdown could continue for an extended period. Given the current conditions, we are actively managing and have taken corrective actions in our manufacturing capacity and spending to align with the forecasted demand.
During 2025, the semiconductor industry continued to experience a softening demand and uncertainty due to macroeconomic factors and the geopolitical environment. In this environment, we have focused on operational excellence and cash flow generation. Given the conditions, we are actively managing and have taken corrective actions in our manufacturing capacity and spending to align with the forecasted demand.
Removed
These statements are based on current expectations and assumptions that are subject to risk, uncertainties, and other factors and speak only as of the filing date.
Added
Operating Results The following table summarizes certain information relating to our operating results that has been derived from our audited consolidated financial statements (in millions): Year ended December 31, 2025 2024 Change Revenue $ 5,995.4 $ 7,082.3 $ (1,086.9) Cost of revenue 4,011.5 3,866.2 145.3 Gross profit 1,983.9 3,216.1 (1,232.2) Operating expenses: Research and development 583.6 612.7 (29.1) Selling and marketing 255.9 273.5 (17.6) General and administrative 348.9 376.3 (27.4) Amortization of intangible assets 44.4 52.0 (7.6) Restructuring, asset impairments and other, net 666.9 133.9 533.0 Total operating expenses 1,899.7 1,448.4 451.3 Operating income 84.2 1,767.7 (1,683.5) Other income (expense), net: Interest expense (70.9) (62.3) (8.6) Interest income 95.1 111.4 (16.3) Other income, net 22.9 20.6 2.3 Other income (expense), net 47.1 69.7 (22.6) Income before income taxes 131.3 1,837.4 (1,706.1) Income tax provision (7.7) (262.8) 255.1 Net income 123.6 1,574.6 (1,451.0) Less: Net income attributable to non-controlling interest (2.6) (1.8) (0.8) Net income attributable to ON Semiconductor Corporation $ 121.0 $ 1,572.8 $ (1,451.8) 37 The following table summarizes certain information relating to our segment results (in millions): 2025 As a % of Total 2024 As a % of Total Dollar Change Revenue: PSG $ 2,805.1 46.8 % $ 3,348.2 47.3 % $ (543.1) AMG 2,261.9 37.7 % 2,609.1 36.8 % (347.2) ISG 928.4 15.5 % 1,125.0 15.9 % (196.6) Total $ 5,995.4 100.0 % $ 7,082.3 100.0 % $ (1,086.9) Cost of revenue: PSG $ 2,117.6 52.8 % $ 1,963.8 50.8 % $ 153.8 AMG 1,105.4 27.6 % 1,302.8 33.7 % (197.4) ISG 788.5 19.6 % 599.6 15.5 % 188.9 Total $ 4,011.5 100.0 % $ 3,866.2 100.0 % $ 145.3 Gross profit: (1) PSG $ 687.5 24.5 % $ 1,384.4 41.3 % $ (696.9) AMG 1,156.5 51.1 % 1,306.3 50.1 % (149.8) ISG 139.9 15.1 % 525.4 46.7 % (385.5) Total $ 1,983.9 33.1 % $ 3,216.1 45.4 % $ (1,232.2) (1) Gross profit margin as a percent of respective segment revenue balances Revenue Revenue was $5,995.4 million and $7,082.3 million for 2025 and 2024, respectively.
Removed
We intend to continue these actions during 2025; however, we believe the current volatility in general economic conditions is not expected to have a significant impact on our long-term strategic and growth initiatives.
Added
The decrease from 2024 to 2025 of $1,086.9 million, or 15.3%, w as attributable primarily to lower sales volumes across all reportable segments, which are further explained below.
Removed
As a result of the reorganization of divisions within PSG and AMG, the prior-period amounts have been reclassified to conform to current-period presentation. (2) Gross profit margin as a percent of respective segment revenue balances Revenue Revenue was $7,082.3 million and $8,253.0 million for 2024 and 2023, respectively.
Added
This was driven by a decrease in revenue of $438.0 million and $120.2 million in the automotive and industrial end-markets, respectively, which was partially offset by increased revenue of $15.1 million in other end-markets which include AI data centers. Revenue from AMG Revenue from AMG decreased by $347.2 million, or approximately 13.3%, during 2025 compared to 2024.
Removed
Revenue from our Power Management Division, Sensor Interface Division and Integrated Circuit Division decreased by $269.1 million, $101.5 million and $77.4 million, respectively, also due to the decrease in demand in the automotive and industrial end-markets.
Added
This was driven by decreases in revenue of $204.1 million and $161.5 million in the automotive and other end-markets, respectively, which was partially offset by an increase of $18.4 million within the industrial end-market. The decrease in the other end-market primarily related to the reduction of manufacturing services revenue at our EFK location.
Removed
This was partially offset by a reduction in the lower-margin manufacturing services revenue at our EFK location which favorably impacted gross profit by approximately $85 million.
Added
Revenue from ISG Revenue from ISG decreased by $196.6 million, or approximately 17.5%, during 2025 compared to 2024.
Removed
PSG gross profit decreased by $437.4 million, primarily driven by the decline in sales volume in both existing products and new products which negatively impacted gross profit by approximately $316 million and $121 million, respectively.
Added
This was driven by decreases in revenue of $177.9 million and $24.2 million in the automotive and industrial end-markets respectively, which was partially offset by increased revenue of $5.5 million in other end-markets. 38 Revenue by Geographic Location Revenue by geographic location, based on sales billed from the respective country or region, was as follows (dollars in millions): 2025 As a % of Revenue (1) 2024 As a % of Revenue (1) Hong Kong $ 1,634.8 27.3 % $ 1,779.3 25.1 % United Kingdom 1,347.0 22.5 % 1,637.8 23.1 % Singapore 1,252.4 20.9 % 1,733.2 24.5 % United States 1,230.6 20.5 % 1,307.5 18.5 % Other 530.6 8.8 % 624.5 8.8 % Total Revenue $ 5,995.4 $ 7,082.3 (1) Certain of the amounts may not total due to rounding of individual amounts.
Removed
However, the Share Repurchase Program may be modified, suspended or terminated by the Board of Directors at any time without prior notice. See Part I, Item 1A "Risk Factors" included elsewhere in this Form 10-K for additional information related to liquidity matters.
Added
Gross Profit and Gross Margin Gross profit was $1,983.9 million and $3,216.1 million for 2025 and 2024, respectively, representing a decrease of $1,232.2 million or approximately 38.3%.
Removed
The dynamic economic environment in which we operate and the resulting assumptions used to estimate future cash flows impact the outcome of our impairment tests.
Added
We recorded excess and obsolete inventory charges of $268.2 million, of which $230.3 million related to inventory primarily considered work in progress within the ISG reportable segment, as a result of changes in business strategy due to the 2025 Manufacturing Realignment Program. See Note 7: ''Restructuring, Asset Impairments and Other, net'' for additional information.
Removed
As we continue to implement our business strategy to rationalize products and manufacturing locations to transition to a lighter internal fabrication model, there could be divestiture transactions that result in a portion of goodwill or other assets being de-recognized and result in accounting charges. Contingencies .
Added
We also continued to experience a decline in sales volume across end-markets. Our gross margin decreased by 12.3 percentage points from 45.4% for the year ended December 31, 2024 to 33.1% for the year ended December 31, 2025, primarily due to the impact of the factors explained in the segment gross margin sections below.
Added
PSG gross profit decreased by $696.9 million, primarily driven by the decline in sales volume in the automotive and industrial end-markets. Also contributing to the decrease in gross profit was the $43.9 million write-off of consumables and manufacturing supplies associated with the manufacturing capacity reduction actions taken under the 2025 Manufacturing Realignment Program.
Added
PSG gross margin decreased by 16.8 percentage points to 24.5% from 41.3%, primarily as a result of the decline in sales volume, underutilization of our manufacturing facilities, the related impact of unfavorable product mix, and the impact of the consumables and manufacturing supplies write-off discussed above.
Added
ISG gross profit decreased by $385.5 million, primarily driven by the $230.3 million excess and obsolete inventory charges discussed above. The decline in sales volume in the automotive and industrial end-markets also added to the decrease.
Added
ISG gross margin decreased 31.6 percentage points to 15.1% from 46.7%, primarily due to the excess and obsolete inventory charges resulting from certain strategy changes in connection with the 2025 Manufacturing Realignment Program.
Added
Operating Expenses Research and Development Research and development expenses were $583.6 million and $612.7 million, or approximately 10% and 9% of revenue for 2025 and 2024, respectively, representing a decrease of $29.1 million, or approximately 5% year-over-year. The decrease was primarily due to a decrease in production supplies, outside services and payroll-related expenses as a result of the restructuring program.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−0 removed5 unchanged
Biggest changeWe estimate a 50-basis point increase in interest rates would impact our expected annual interest expense for the next 12 months by approximately $1.9 million. However, this impact may be partially offset by the additional interest earned on our cash and cash equivalents.
Biggest changeIf we had not repaid the outstanding balance on the Revolving Credit Facility on December 31, 2025, we estimate a 50-basis point increase in interest rates would have impacted our expected annual interest expense for the next 12 months by approximately $1.9 million.
See Note 15: ''Financial Instruments'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K for further information with respect to our hedging activity.
See Note 15: ''Financial Instruments'' in the notes to the audited consolidated financial statements included elsewhere in this Form 10-K for further information with respect to our hedging activity. 50
Substantially all of our revenue is transacted in U.S. dollars. However, a significant amount of our operating expenditures and capital purchases are transacted in local currencies, including Chinese Renminbi, Czech koruna, euros, Japanese yen, Korean won, Malaysian ringgit, Philippine peso and Vietnamese dong.
Substantially all of our revenue is transacted in U.S. dollars. However, a significant amount of our operating expenditures and capital purchases are transacted in local currencies, including Chinese renminbi, Czech koruna, euro, Japanese yen, Korean won, Malaysian ringgit, Philippine peso and Vietnamese dong.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to financial market risks, including changes in interest rates and foreign currency exchange rates. To mitigate these risks, we utilize derivative financial instruments. We do not use derivative financial instruments for speculative or trading purposes. 43 As of December 31, 2024, our gross long-term debt totaled $3,379.9 million.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to financial market risks, including changes in interest rates and foreign currency exchange rates. To mitigate these risks, we utilize derivative financial instruments. We do not use derivative financial instruments for speculative or trading purposes. As of December 31, 2025, our gross long-term debt totaled $3,004.9 million.
For example, we determined that based on a hypothetical weighted-average change of 10% in currency exchange rates, our operating income would have impacted our income before taxes by approximately $110.6 million for the year ended December 31, 2024, assuming no offsetting hedge position or correlated activities.
For example, we determined that based on a hypothetical weighted-average change of 10% in currency exchange rates, our operating income would have impacted our income before taxes by approximately $102.3 million for the year ended December 31, 2025, assuming no offsetting hedge position or correlated activities.
Changes in the fair value of these undesignated hedges are recognized in other income and expense immediately as an offset to the changes in the fair value of the assets or liabilities being hedged. The notional amount of foreign exchange contracts at December 31, 2024 and 2023 was $256.8 million and $262.2 million, respectively.
Changes in the fair value of these undesignated hedges are recognized in other income and expense immediately as an offset to the changes in the fair value of the assets or liabilities being hedged. The notional amount of foreign exchange contracts at December 31, 2025 and 2024 was $190.5 million and $256.8 million, respectively.
We have no interest rate exposure to rate changes on our fixed rate debt, which totaled $3,004.9 million. We do have interest rate exposure with respect to our Revolving Credit Facility, which had a $375.0 million balance as of December 31, 2024.
We have no interest rate exposure to rate changes on our fixed rate debt, which totaled $3,004.9 million. We would have interest rate exposure with respect to our Revolving Credit Facility, however, there were no borrowings outstanding on the Revolving Credit Facility as of December 31, 2025.

Other ON 10-K year-over-year comparisons