The Zhitong Finance App learned that after announcing its second-quarter results and performance guidelines, Onsemi Semiconductor (ON.US) was generally favored by Wall Street analysts. The company's stock price once rose about 7% before the market on Tuesday, but after opening, the stock erased pre-market gains. As of press time, the stock rose 0.58% to $80.92. Many organizations believe that the artificial intelligence (AI) data center business is becoming the company's most important growth engine. At the same time, industrial and automotive businesses are gradually improving, and superimposed orders, capacity utilization, and gross margin continue to rise, and the company's fundamentals are expected to improve further.
Jefferies maintains Ansemi Semiconductor's “buy” rating with a target price of $115. Analyst Blayne Curtis's team said that the AI data center business is rapidly becoming the company's core growth engine. The business's revenue is expected to increase by about 200% year over year, clearly ahead of most analog chip companies; at the same time, the industrial and automotive businesses are also showing a moderate recovery.
Jefferies pointed out that the company's delivery cycle, order shipment ratio, and capacity utilization rate have all continued to improve, which will support a month-on-month expansion in gross margin for the rest of the year. The agency also stated that it is encouraged by the continued growth of the AI business and the improvement in profitability, and believes that the Analyst Day to be held by the company on September 16 will further explain the development opportunities in the AI data center field.
Susquehanna is also optimistic about Ansemi Semiconductors and maintains a target price of $150. Analyst Christopher Rolland's team said that the company's second-quarter results and third-quarter results guidance were slightly better than market expectations, and the performance that exceeded expectations was mainly due to the growth of the AI data center business.
At the same time, the agency pointed out that the company's overall industry sentiment continued to improve, and several key cycle indicators improved markedly this quarter, including an increase in customer demand, order shipment ratio, and mass market revenue. Furthermore, the company's average delivery cycle has been extended by about five weeks, which also reflects the continued increase in market demand.
Susquehanna believes that overall, this is a steady financial report, and the continued expansion of AI data center demand has brought clear performance momentum to the company.
Morgan Stanley said that the overall performance of Ansemi Semiconductors in the second quarter was basically in line with market expectations, and the third quarter results guidance slightly exceeded expectations, which also mainly benefited from increased demand for AI data centers.
The bank pointed out that in line with peer trends, Ansemi Semiconductor's management mentioned that demand in the industrial market continues to expand, the data center business maintains strong growth, while the overall automotive business remains stable and continues to benefit from the increase in bicycle chip content.
Notably, Morgan Stanley said that part of the company's production capacity switched from automotive customers to AI data center (AIDC) solutions this quarter, but it is expected that this situation will gradually return to normal in the next few quarters. At the same time, in order to meet the growth in demand, the company's capacity utilization rate continues to increase, and profit margins are maintained through price adjustments and implementation of accurate pricing for local products with tight supply and demand.
Furthermore, customers have begun to pre-target product supply from 2027 to 2028, which has further increased the company's order visibility for the next few years and strengthened the market's confidence in its long-term growth prospects.