Chipmaker Onsemi forecasts upbeat quarterly revenue on resilient demand from EV makers

Reuters

Mon, May 5, 2025, 8:31 AM 1 min read

(Reuters) -Onsemi forecast second-quarter revenue above Wall Street expectations on Monday, as demand for its chips used in electric vehicles remains resilient despite economic uncertainty brought on by U.S. President Donald Trump's tariffs on auto imports.

Orders for Onsemi's silicon carbide chips have been helped in the first quarter by growth in EV sales in China and Europe, even as a 25% U.S. tariff on auto imports threatens to raise prices.

Trump's duties, in effect from April 3, may lead to supply chain disruptions and a jump in car prices by thousands of dollars, causing several automakers to pull their forecasts.

Onsemi is one of a handful of suppliers of silicon carbide chips used to extend the range of electric vehicles.

The company last month scrapped its $6.9 billion takeover offer for smaller rival Allegro MicroSystems, citing a reluctance of Allegro's board to fully engage with the proposal.

In February, the chipmaker said it would lay off about 2,400 employees worldwide in 2025.

Onsemi forecast second-quarter revenue between $1.40 billion and $1.50 billion, the midpoint of which is above analysts' estimate of $1.42 billion, according to data compiled by LSEG.

It expects second-quarter adjusted earnings per share between 48 cents and 58 cents, compared with estimates of 52 cents.

The company reported first-quarter revenue of $1.45 billion, beating estimates of $1.40 billion. The revenue, however, fell 22% from a year ago.

(Reporting by Zaheer Kachwala in Bengaluru; Editing by Sahal Muhammed)