For the third quarter of 2015, highlights include:
- Total revenues of $904.2 million
- GAAP earnings per diluted share of $0.11, non-GAAP earnings per diluted share of $0.23
- GAAP and non-GAAP gross margin of 34.1 percent
- GAAP operating margin of 7.7 percent, and non-GAAP operating margin of 11.8 percent
- Repurchased approximately 9.4 million shares for approximately $100 million
PHOENIX — (BUSINESS WIRE) — October 29, 2015 — ON Semiconductor Corporation (Nasdaq: ON) today announced that total revenues in the third quarter of 2015 were $904.2 million, up approximately three percent compared to the second quarter of 2015. During the third quarter of 2015, the company reported GAAP net income of $46.3 million, or $0.11 per diluted share. The third quarter 2015 GAAP net income was negatively impacted by approximately $49.2 million of special items, details of which can be found in the attached schedules.
Third quarter 2015 non-GAAP net income was $95.5 million, or $0.23 per diluted share, compared to $95.4 million, or $0.22 per diluted share, for the second quarter of 2015. A reconciliation of these non-GAAP financial measures (and other non-GAAP measures used elsewhere in this release) to the company's most directly comparable measures prepared in accordance with U.S. GAAP are set forth in the attached schedules and on our website at http://www.onsemi.com. Additional information on revenue by end market, region, distribution channel, business units and share count can be found on the "Investors" section of our website.
Total company GAAP and non-GAAP gross margin in the third quarter was 34.1 percent. For the third quarter of 2015, GAAP operating margin was 7.7 percent, and non-GAAP operating margin was 11.8 percent.
Adjusted EBITDA for the third quarter of 2015 was $163.1 million. Adjusted EBITDA for the second quarter of 2015 was $163.5 million. During the third quarter, the company repurchased approximately 9.4 million shares of common stock for approximately $100 million.
"The current macroeconomic environment has been challenging, but we continue to outpace the industry," said Keith Jackson, president and CEO of ON Semiconductor. "Order trends for most end-markets have been sub-seasonal due to realignment of supply chain, but recent trends have been encouraging and point to an improving industry environment early next year.
"We remain optimistic about the strength of our product portfolio and design win pipeline. Our momentum in industrial, automotive and smartphone markets should continue to accelerate as new design wins ramp into production and the breadth of our customer engagement grows."
FOURTH QUARTER 2015 OUTLOOK
"Based on product booking trends, backlog levels, and estimated turns levels, we anticipate that total ON Semiconductor revenue will be approximately $830 to $870 million in the fourth quarter of 2015," Jackson said. "Backlog levels for the fourth quarter of 2015 represent approximately 80 to 85 percent of our anticipated fourth quarter 2015 revenue. The outlook for the fourth quarter of 2015 includes stock-based compensation expense of approximately $11 million to $13 million."
The following table outlines ON Semiconductor's projected fourth quarter of 2015 GAAP and non-GAAP outlook.
|
ON SEMICONDUCTOR Q4 2015 BUSINESS OUTLOOK |
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|
Total ON Semiconductor
GAAP |
Special
Items *** |
Total ON Semiconductor
Non-GAAP**** |
||||||||||
| Revenue | $830 to $870 million | $830 to $870 million | ||||||||||
| Gross Margin | 32.6% to 34.6% | 32.6% to 34.6% | ||||||||||
| Operating Expenses | $225 to $237 million | $37 to $39 million | $188 to $198 million | |||||||||
| Net Interest Expense / Other Expenses | $7 to $10 million | $7 to $10 million | ||||||||||
| Convertible Notes, Non-cash Interest Expense* | $6 million | $6 million | ||||||||||
| Tax | $2 to $6 million | $2 to $3 million | $5 to $8 million | |||||||||
| Diluted Share Count ** | 418 million | 418 million | ||||||||||
| * | Convertible Notes, Non-cash Interest Expense is calculated pursuant to FASB's Accounting Standards Codification (“ASC”) Topic 470: Debt. |
| ** | Diluted share count can vary for, among other things, the actual exercise of options or vesting of restricted stock units, the incremental dilutive shares from the company's convertible senior subordinated notes, and the repurchase or the issuance of stock or convertible notes or the sale of treasury shares. In periods when the quarterly average stock price per share exceeds $18.50, the Non-GAAP diluted share count and Non-GAAP net income per share includes the anti-dilutive impact of the company’s hedge transactions, issued concurrently with the 1.00% Notes. At an average stock price per share between $18.50 and $25.96, the hedging activity offsets the potentially dilutive effect of the 1.00% Notes and warrants. |
| *** | Special items may include: amortization of intangible assets; amortization of acquisition-related intangibles; expensing of appraised inventory fair market value step-up; inventory valuation adjustments; purchased in-process research and development expenses; restructuring, asset impairments and other, net; goodwill impairment charges; gains and losses on debt prepayment; non-cash interest expense; income tax adjustments to approximate cash taxes; actuarial (gains) losses on pension plans and other pension benefits; and certain other special items, as necessary. |
| **** | Regulation G and other provisions of the securities laws regulate the use of financial measures that are not prepared in accordance with GAAP. We believe these non-GAAP measures provide important supplemental information to investors. We use these measures, together with GAAP measures, for internal managerial purposes and as a means to evaluate period-to-period comparisons. However, we do not, and you should not, rely on non-GAAP financial measures alone as measures of our performance. We believe that non-GAAP financial measures reflect an additional way of viewing aspects of our operations that - when taken together with GAAP results and the reconciliations to corresponding GAAP financial measures that we also provide in our releases - provide a more complete understanding of factors and trends affecting our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures, even if they have similar names. | ||
