onsemi to Announce Q4 Results: Industry Demand Shaping Earnings

onsemi (ON), a key player in the semiconductor industry, is prepared to report its earnings for the fourth quarter of 2023 on February 5th. There is considerable interest in whether the company has maintained its revenue and earnings momentum amid various market conditions.

The company has forecasted its revenues for the quarter to be between $1.95 billion and $2.05 billion, with expected earnings ranging from $1.13 to $1.27 per share. Despite these figures, analysts have set the consensus for earnings at $1.21 per share, suggesting a potential year-over-year decline of 8.33%. Revenues are also projected to fall by 4.83% compared to the same quarter in the previous year, with estimates around $2 billion.

Historically, onsemi has outperformed earnings expectations consistently across the last four quarters, achieving an average surprise of 6.73%. As the upcoming earnings report approaches, investors are keen to understand the drivers behind onsemi's performance.

Drivers of Q4 Performance

onsemi's success in the fourth quarter is likely influenced by the growing demand for its products in the automotive and industrial sectors. The company's components are integral to a variety of applications, including electric vehicles (EVs), advanced driver-assistance systems (ADAS), and newer energy infrastructure developments.

One prominent area that may contribute to onsemi's revenue is the silicon carbide segment, where the company holds a significant market position. Additionally, innovations such as the EliteSIC modules, which enhance electric vehicle efficiency and range, and the Hyperlux Family sensors, which offer low power consumption and high resolution for automotive and industrial use, are expected to fuel revenue growth.

However, not all factors are poised to positively impact onsemi's earnings. Challenges such as the weakened demand for European automotive components and a potential decline in silicon carbide shipments could temper the overall growth.

Earnings Forecast

Financial models like the Zacks model help predict the likelihood of an earnings beat, considering factors like Earnings ESP and the Zacks Rank. For onsemi, the Earnings ESP is currently at -0.46%, and the company holds a Zacks Rank #3 (Hold), which suggests that an earnings beat is not necessarily expected in this quarter.

Nevertheless, onsemi's performance in the forthcoming report will be pivotal for investors and could set the tone for the company's trajectory in the near term.

Other Companies to Watch

Investors monitoring the semiconductor space are also keeping a close eye on other tech companies gearing up for their earnings reports. For instance, Meta Platforms (META) and Twilio (TWLO) are positioned favorably with respective Earnings ESPs of +0.51% and +31.37%, combined with Zacks Rank #2 (Buy). Meanwhile, Bill Holdings (BILL) with an Earnings ESP of +6.17% and a Zacks Rank #3 (Hold) is another company that warrants attention.

As the earnings season progresses, keeping an updated watch on these and other forthcoming announcements is essential for informed investing decisions.

onsemi, earnings, performance