Semiconductors Stocks Q2 Teardown: Western Digital (NASDAQ:WDC) Vs The Rest

Let’s dig into the relative performance of Western Digital (NASDAQ:WDC) and its peers as we unravel the now-completed Q2 semiconductors earnings season.

The semiconductor industry is driven by cyclical demand for advanced electronic products like smartphones, PCs, servers, and data storage. While analog chips serve as the building blocks of most electronic goods and equipment, processors (CPUs) and graphics chips serve as their brains. The growth of data and technologies like artificial intelligence, 5G, the Internet of Things, and smart cars are creating the next wave of secular growth for the industry.

The 41 semiconductors stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 2.7% while next quarter’s revenue guidance was in line.

Thankfully, share prices of the companies have been resilient as they are up 6.8% on average since the latest earnings results.

Western Digital (NASDAQ:WDC)

Founded in 1970 by a Motorola employee, Western Digital (NASDAQ: WDC) is a leading producer of hard disk drives, SSDs and flash memory.

Western Digital reported revenues of $2.61 billion, up 30% year on year. This print exceeded analysts’ expectations by 4.8%. Overall, it was a very strong quarter for the company with a significant improvement in its inventory levels and a beat of analysts’ EPS estimates.

Interestingly, the stock is up 30.8% since reporting and currently trades at $93.53.

Is now the time to buy Western Digital? Access our full analysis of the earnings results here, it’s free.

Best Q2: IPG Photonics (NASDAQ:IPGP)

Both a designer and manufacturer of its products, IPG Photonics (NASDAQ:IPGP) is a provider of high-performance fiber lasers used for cutting, welding, and processing raw materials.

IPG Photonics reported revenues of $250.7 million, down 2.7% year on year, outperforming analysts’ expectations by 9.4%. The business had an exceptional quarter with a beat of analysts’ EPS and adjusted operating income estimates.

The market seems happy with the results as the stock is up 6.8% since reporting. It currently trades at $82.88.

Is now the time to buy IPG Photonics? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Himax (NASDAQ:HIMX)

Taiwan-based Himax Technologies (NASDAQ:HIMX) is a leading manufacturer of display driver chips and timing controllers used in TVs, laptops, and mobile phones.

Himax reported revenues of $214.8 million, down 10.4% year on year, exceeding analysts’ expectations by 1.3%. Still, it was a softer quarter as it posted EPS in line with analysts’ estimates and an increase in its inventory levels.

As expected, the stock is down 3.4% since the results and currently trades at $8.35.

Read our full analysis of Himax’s results here.

NXP Semiconductors (NASDAQ:NXPI)

Spun off from Dutch electronics giant Philips in 2006, NXP Semiconductors (NASDAQ: NXPI) is a designer and manufacturer of chips used in autos, industrial manufacturing, mobile devices, and communications infrastructure.

NXP Semiconductors reported revenues of $2.93 billion, down 6.4% year on year. This result topped analysts’ expectations by 0.8%. More broadly, it was a mixed quarter as it also logged a beat of analysts’ EPS estimates but revenue guidance for next quarter meeting analysts’ expectations.

The stock is down 1.3% since reporting and currently trades at $225.55.

Read our full, actionable report on NXP Semiconductors here, it’s free.

Vishay Intertechnology (NYSE:VSH)

Named after the founder's ancestral village in present-day Lithuania, Vishay Intertechnology (NYSE:VSH) manufactures simple chips and electronic components that are building blocks of virtually all types of electronic devices.

Vishay Intertechnology reported revenues of $762.3 million, up 2.8% year on year. This number met analysts’ expectations. Taking a step back, it was a slower quarter as it produced a significant miss of analysts’ EPS estimates and revenue guidance for next quarter slightly missing analysts’ expectations.

The stock is down 3.9% since reporting and currently trades at $15.38.

Read our full, actionable report on Vishay Intertechnology here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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