ON Semiconductor Positioned to Benefit from AI Spending Surge
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 20 2026
0mins
Source: Fool
ON Semiconductor's stock rose by 5.16% and reached a 5-day high amid positive market conditions.
The company is set to benefit significantly from the projected surge in AI inference spending, which is expected to surpass data center infrastructure spending in the coming years. CEO Hassane El-Khoury anticipates that ON Semiconductor's data center revenue will double to $500 million in 2026, exceeding market expectations and indicating strong growth potential. This positions the company favorably in the rapidly evolving AI landscape, particularly with its strong foothold in the power semiconductor sector.
The implications of this growth are substantial, as ON Semiconductor is not only expanding its market share in data centers but also diversifying into edge inference applications in smart manufacturing and healthcare diagnostics, further enhancing its competitive edge.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy ON?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on ON
Wall Street analysts forecast ON stock price to fall
19 Analyst Rating
9 Buy
10 Hold
0 Sell
Moderate Buy
Current: 94.690
Low
50.00
Averages
61.25
High
80.00
Current: 94.690
Low
50.00
Averages
61.25
High
80.00
About ON
ON Semiconductor Corporation is engaged in providing intelligent power and intelligent sensing solutions. The Company’s intelligent power technologies enable the electrification of drivetrain in the automotive industry to allow for lighter and longer-range electric vehicles. Its segments include Power Solutions Group (PSG), the Analog and Mixed-Signal Group (AMG) and the Intelligent Sensing Group (ISG). PSG segment provides a portfolio of discrete, module, and integrated semiconductor devices designed to enable conversion across artificial intelligence (AI) data centers, energy infrastructure, automotive and industrial. AMG segment designs and develops a range of analog and mixed-signal solutions including power‑management, sensor‑interface, connectivity, and products that serve automotive, industrial automation, AI data center, computing, and mobile end markets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
US Stocks Close Lower as Chipmakers Weigh on Market
- Market Decline: On Tuesday, the S&P 500 index fell by 0.45%, the Dow Jones Industrial Average dropped by 0.25%, and the Nasdaq 100 index decreased by 1.77%, indicating a broader market decline under pressure from a selloff in chipmakers, reflecting investor concerns over high valuations.
- Samsung's Earnings Disappointment: Despite Samsung Electronics reporting a 19-fold profit surge, its stock plummeted over 8% in South Korea, suggesting market skepticism regarding the future profitability of the semiconductor sector, which could impact investor confidence in related companies.
- Geopolitical Risks Heightened: Crude oil prices surged to a 1.5-week high due to attacks on shipping in the Strait of Hormuz, raising inflation expectations and pushing bond yields higher, with the 10-year T-note yield reaching a 3.5-week high of 4.54%, adding uncertainty to the market.
- Strength in Software Stocks: Despite the overall market pressure, strong performance in software stocks indicates a rotation of funds into other sectors, with companies like Workday seeing stock price increases of over 4%, providing some support for the market.
See More
Pomerantz LLP Investigates ON Semiconductor for Securities Fraud
- Investigation Launched: Pomerantz LLP is investigating whether ON Semiconductor and its executives have engaged in securities fraud or other unlawful business practices, aiming to protect investor rights and seek legal remedies.
- Acquisition Agreement: On June 25, 2026, ON Semiconductor announced an all-stock deal to acquire IoT company Synaptics for approximately $7 billion, with Synaptics shareholders receiving 1.35 shares of ON stock for each share held.
- Stock Price Decline: Following the announcement of the acquisition, ON Semiconductor's stock price fell by $28.09, or 23.66%, closing at $90.65 per share on June 26, 2026, indicating a negative market reaction to the deal.
- Legal Context: Pomerantz LLP is a prominent securities class action law firm that has been advocating for victims of securities fraud and corporate misconduct for over 85 years, highlighting the significant legal risks facing ON Semiconductor.
See More
US Stocks Decline as Chipmakers Struggle
- Market Decline: The S&P 500 index fell by 0.67%, the Dow Jones Industrial Average by 0.38%, and the Nasdaq 100 by 2.14%, indicating a bearish market sentiment, particularly driven by a selloff in chipmakers.
- Samsung's Earnings Disappointment: Despite a staggering 19-fold profit increase, Samsung Electronics' stock dropped over 8% in South Korea, reflecting investor concerns over high valuations in the semiconductor sector, which could undermine overall market confidence.
- Rising Oil Prices: Following attacks in the Strait of Hormuz, WTI crude oil prices surged over 2%, raising inflation expectations and pushing bond yields higher, with the 10-year T-note yield reaching a 3.5-week high of 4.52%.
- Widening Trade Deficit: The US trade deficit for May expanded to $77.6 billion, the largest in 14 months, which may negatively impact Q2 GDP, adding to market uncertainties.
See More
Mixed US Stock Performance, Chipmakers Under Pressure
- Divergent Market Performance: The S&P 500 Index is down 0.19% while the Dow Jones Industrial Average is up 0.04%, indicating a mixed market performance, particularly under pressure from chipmakers, which could affect investor confidence.
- Samsung's Earnings Miss Expectations: Despite a 19-fold surge in profits, Samsung Electronics' stock fell over 8% in South Korea, reflecting market concerns over high valuations in the semiconductor sector, potentially prompting investors to reassess their holdings in related stocks.
- Rising Crude Oil Prices: WTI crude oil prices increased by over 1% following attacks on shipping in the Strait of Hormuz, which not only raised inflation expectations but also pushed the 10-year T-note yield to a two-week high of 4.51%, potentially exerting further pressure on the stock market.
- Widening Trade Deficit: The US trade deficit widened to $77.6 billion in May, the largest in 14 months, which could negatively impact Q2 GDP, further exacerbating market uncertainties.
See More
onsemi Sells Manufacturing Facilities to Optimize Costs
- Strategic Optimization: onsemi (ON) has signed definitive agreements to sell its manufacturing facilities in Tarlac, Philippines, and Mountain Top, Pennsylvania, as part of its ongoing Fab Right strategy aimed at optimizing its manufacturing cost structure and supporting sustained gross margin expansion.
- Cost Savings Expected: These transactions are projected to result in annual cost savings of approximately $35 million, with initial savings starting in 2027 and full savings realized by 2028, thereby enhancing the company's financial health and profitability.
- Long-Term Supply Agreement: The agreement with Taiwan-based Greatek Electronics ensures ongoing production and customer commitments post-transaction, demonstrating onsemi's commitment to maintaining strong customer relationships.
- Market Reaction: Despite the strategic asset disposals, onsemi's shares fell 2.4% in premarket trading, reflecting market caution regarding the company's future profitability.
See More
US Stocks Close Higher, Led by Tech Gains
- Strong Market Performance: The S&P 500 rose by 0.72%, reaching a 2.5-week high, while the Dow Jones Industrial Average increased by 0.29%, setting a new all-time high, reflecting robust confidence in tech stocks and chipmakers.
- Supportive Economic Data: The US June ISM services index stood at 54.0, meeting expectations, with the employment sub-index rising to 51.2, surpassing the anticipated 48.2, indicating ongoing economic expansion that may alleviate Fed rate hike pressures.
- Optimistic Earnings Outlook: Bloomberg Intelligence forecasts a 23% increase in Q2 earnings, close to Q1's 30% surge, primarily driven by strong performance in AI infrastructure stocks, expected to contribute nearly 60% of earnings growth, further boosting market sentiment.
- International Market Fluctuations: While US stocks rose, European markets generally declined, with Eurozone May retail sales increasing by only 0.2%, below the expected 0.3%, highlighting uneven global economic recovery that could impact investor confidence.
See More
US Stocks Close Lower as Chipmakers Weigh on Market
- Market Decline: On Tuesday, the S&P 500 index fell by 0.45%, the Dow Jones Industrial Average dropped by 0.25%, and the Nasdaq 100 index decreased by 1.77%, indicating a broader market decline under pressure from a selloff in chipmakers, reflecting investor concerns over high valuations.
- Samsung's Earnings Disappointment: Despite Samsung Electronics reporting a 19-fold profit surge, its stock plummeted over 8% in South Korea, suggesting market skepticism regarding the future profitability of the semiconductor sector, which could impact investor confidence in related companies.
- Geopolitical Risks Heightened: Crude oil prices surged to a 1.5-week high due to attacks on shipping in the Strait of Hormuz, raising inflation expectations and pushing bond yields higher, with the 10-year T-note yield reaching a 3.5-week high of 4.54%, adding uncertainty to the market.
- Strength in Software Stocks: Despite the overall market pressure, strong performance in software stocks indicates a rotation of funds into other sectors, with companies like Workday seeing stock price increases of over 4%, providing some support for the market.
See More
Pomerantz LLP Investigates ON Semiconductor for Securities Fraud
- Investigation Launched: Pomerantz LLP is investigating whether ON Semiconductor and its executives have engaged in securities fraud or other unlawful business practices, aiming to protect investor rights and seek legal remedies.
- Acquisition Agreement: On June 25, 2026, ON Semiconductor announced an all-stock deal to acquire IoT company Synaptics for approximately $7 billion, with Synaptics shareholders receiving 1.35 shares of ON stock for each share held.
- Stock Price Decline: Following the announcement of the acquisition, ON Semiconductor's stock price fell by $28.09, or 23.66%, closing at $90.65 per share on June 26, 2026, indicating a negative market reaction to the deal.
- Legal Context: Pomerantz LLP is a prominent securities class action law firm that has been advocating for victims of securities fraud and corporate misconduct for over 85 years, highlighting the significant legal risks facing ON Semiconductor.
See More
US Stocks Decline as Chipmakers Struggle
- Market Decline: The S&P 500 index fell by 0.67%, the Dow Jones Industrial Average by 0.38%, and the Nasdaq 100 by 2.14%, indicating a bearish market sentiment, particularly driven by a selloff in chipmakers.
- Samsung's Earnings Disappointment: Despite a staggering 19-fold profit increase, Samsung Electronics' stock dropped over 8% in South Korea, reflecting investor concerns over high valuations in the semiconductor sector, which could undermine overall market confidence.
- Rising Oil Prices: Following attacks in the Strait of Hormuz, WTI crude oil prices surged over 2%, raising inflation expectations and pushing bond yields higher, with the 10-year T-note yield reaching a 3.5-week high of 4.52%.
- Widening Trade Deficit: The US trade deficit for May expanded to $77.6 billion, the largest in 14 months, which may negatively impact Q2 GDP, adding to market uncertainties.
See More
Mixed US Stock Performance, Chipmakers Under Pressure
- Divergent Market Performance: The S&P 500 Index is down 0.19% while the Dow Jones Industrial Average is up 0.04%, indicating a mixed market performance, particularly under pressure from chipmakers, which could affect investor confidence.
- Samsung's Earnings Miss Expectations: Despite a 19-fold surge in profits, Samsung Electronics' stock fell over 8% in South Korea, reflecting market concerns over high valuations in the semiconductor sector, potentially prompting investors to reassess their holdings in related stocks.
- Rising Crude Oil Prices: WTI crude oil prices increased by over 1% following attacks on shipping in the Strait of Hormuz, which not only raised inflation expectations but also pushed the 10-year T-note yield to a two-week high of 4.51%, potentially exerting further pressure on the stock market.
- Widening Trade Deficit: The US trade deficit widened to $77.6 billion in May, the largest in 14 months, which could negatively impact Q2 GDP, further exacerbating market uncertainties.
See More
onsemi Sells Manufacturing Facilities to Optimize Costs
- Strategic Optimization: onsemi (ON) has signed definitive agreements to sell its manufacturing facilities in Tarlac, Philippines, and Mountain Top, Pennsylvania, as part of its ongoing Fab Right strategy aimed at optimizing its manufacturing cost structure and supporting sustained gross margin expansion.
- Cost Savings Expected: These transactions are projected to result in annual cost savings of approximately $35 million, with initial savings starting in 2027 and full savings realized by 2028, thereby enhancing the company's financial health and profitability.
- Long-Term Supply Agreement: The agreement with Taiwan-based Greatek Electronics ensures ongoing production and customer commitments post-transaction, demonstrating onsemi's commitment to maintaining strong customer relationships.
- Market Reaction: Despite the strategic asset disposals, onsemi's shares fell 2.4% in premarket trading, reflecting market caution regarding the company's future profitability.
See More
US Stocks Close Higher, Led by Tech Gains
- Strong Market Performance: The S&P 500 rose by 0.72%, reaching a 2.5-week high, while the Dow Jones Industrial Average increased by 0.29%, setting a new all-time high, reflecting robust confidence in tech stocks and chipmakers.
- Supportive Economic Data: The US June ISM services index stood at 54.0, meeting expectations, with the employment sub-index rising to 51.2, surpassing the anticipated 48.2, indicating ongoing economic expansion that may alleviate Fed rate hike pressures.
- Optimistic Earnings Outlook: Bloomberg Intelligence forecasts a 23% increase in Q2 earnings, close to Q1's 30% surge, primarily driven by strong performance in AI infrastructure stocks, expected to contribute nearly 60% of earnings growth, further boosting market sentiment.
- International Market Fluctuations: While US stocks rose, European markets generally declined, with Eurozone May retail sales increasing by only 0.2%, below the expected 0.3%, highlighting uneven global economic recovery that could impact investor confidence.
See More
