ON Set to Report Q1 Earnings: What's in Store for the Stock?

On Semiconductor ON is slated to release its first-quarter 2025 results on May 5.

For first-quarter 2025, ON expects revenues between $1.35 billion and $1.45 billion. Earnings are expected to be in the range of 45-55 cents per share.

The Zacks Consensus Estimate for first-quarter 2025 earnings is pegged at 51 cents per share, unchanged in the past 30 days. This indicates a decline of 52.78% from the figure reported in the year-ago quarter.

The consensus mark for revenues is pegged at $1.41 billion, suggesting a decline of 12.56% from the year-ago quarter’s reported figure.

ON Semiconductor Corporation Price and EPS Surprise

ON Semiconductor Corporation price-eps-surprise | ON Semiconductor Corporation Quote

On Semiconductor’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average surprise being 1.80%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Let us see how things have shaped up prior to this announcement.

Factors Likely to Have Influenced ON’s Q1 Performance

ON Semiconductor’s first-quarter performance is likely to have suffered due to volatility in the automotive sector. The company is navigating headwinds from geopolitical uncertainties, supply-chain disruptions and a slower-than-expected EV adoption rate. These factors have led to fluctuating demand, with automakers scaling back production forecasts amid shifting consumer sentiment and macroeconomic challenges.

Based on the above factors, ON Semiconductor anticipates a steep decline in automotive revenues for the first quarter of 2025, with a sequential drop of 25% or more, largely due to weakening demand in China.

ON’s industrial revenues declined 5% sequentially in the fourth quarter amid continued inventory digestion and weakness in traditional markets. With manufacturing activity slowing and PMIs remaining soft across major regions, industrial headwinds are expected to have continued in the to be reported quarter.

The company’s focus on silicon carbide remains a key driver. Design wins for hyperscalers began to ramp in the fourth quarter, and ON expects its SiC JFET and SiC MOSFET revenues to grow through 2025. The recent acquisition of Qorvo’s SiC JFET business is likely to have supported the company’s strategy of delivering a complete power solution across automotive, AI data center, and industrial markets. This is expected to have contributed well in the quarter under review.

What Our Model Says

The Zacks model predicts that the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

On Semiconductor has an Earnings ESP of 0.00% and a Zacks Rank #5 (Strong Sell) at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are some other companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases: 

StoneCo STNE has an Earnings ESP of +13.79% and sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

StoneCo shares have appreciated 76.2% year to date. STNE is set to report its first-quarter 2025 results on May 8.

Baidu BIDU currently has an Earnings ESP of +8.67% and a Zacks Rank #3.

Baidu shares are up 4.6% year to date. BIDU is slated to report its first-quarter 2025 results on May 21.

Affirm AFRM presently has an Earnings ESP of +63.27% and sports a Zacks Rank #1. 

Affirm shares have plunged 17.4% year to date. AFRM is scheduled to report its fourth-quarter fiscal 2025 results on May 8

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This article originally published on Zacks Investment Research (zacks.com).

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