onsemi Surpasses Midpoint Revenue Guidance, Sees Significant Operating Leverage in Q3 2026 Earnings
onsemi, a leading semiconductor company, has announced its third-quarter earnings for 2026, showcasing continued strength and momentum across strategic growth markets. The company's Q3 results exceeded midpoint revenue guidance, with $1.72 billion in revenue, non-GAAP gross margin of approximately 41.2%, and non-GAAP diluted earnings per share of $0.90.
According to Hassane El-Khoury, President and CEO, the third quarter reflects the company's continued focus on strategic growth markets, where power density is becoming a key differentiator. These markets include AI data centers, grid infrastructure supporting them, energy storage, and next-generation vehicle architectures.
The company sees particularly strong demand in these areas, with AI data center being its fastest-growing market. In the third quarter, AI data center revenue grew 39% sequentially to $180 million, and onsemi now expects to deliver approximately $620 million of revenue in 2026, an increase of 140% year-over-year.
onsemi's automotive business continues to gain content and secure new platform wins in every region. Industrial demand is also improving, led by power infrastructure and energy applications. The company's decision to allocate supply to markets with strong end demand, such as AI data centers and industrial, has resulted in meaningful operating leverage.
Thad Trent, CFO, emphasized the importance of disciplined execution in driving earnings growth significantly outpacing revenue growth. However, onsemi made a short-term decision to not support inventory replenishment backlog in automotive due to supply limitations. Despite this, the company expects 2027 automotive growth to be in line with its long-term target.
The company's Q3 results demonstrate onsemi's commitment to strategic investments and execution. With a strong focus on AI data centers, industrial, and other high-growth markets, onsemi is poised for continued success in 2026 and beyond.
onsemi's Q3 earnings release and presentation are available on the Investor Relations section of their website at www.onsemi.com. The company's forward-looking statements regarding future events or financial performance may be subject to risks and uncertainties that could cause actual results to differ materially from projections.
The full transcript of the Q3 2026 conference call is also available, featuring presentations by Hassane El-Khoury, President and CEO, Thad Trent, CFO, and Parag Agarwal, Vice President of Corporate Development and Investor Relations. Interested investors can access this information to gain a deeper understanding of onsemi's business performance and outlook.
As the company continues to navigate its growth trajectory, onsemi remains committed to transparency and communication with stakeholders. With a focus on strategic markets, disciplined execution, and innovation, onsemi is well-positioned for continued success in 2026 and beyond.
The onsemi team's efforts have resulted in a remarkable Q3 performance, exceeding expectations and demonstrating the company's commitment to delivering value to shareholders. As investors and stakeholders continue to monitor onsemi's progress, it will be exciting to see how the company further executes its strategy and achieves its goals.
