ON SEMICONDUCTOR CORPON
ON SEMICONDUCTOR CORP Debt Disclosure
Note 9: Long-Term Debt
The Company's long-term debt consists of the following (annualized interest rates, dollars in millions):
| As of December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Revolving Credit Facility due 2028 | $ | — | $ | 375.0 | |||||||
0.50% Notes due 2029 (1) | 1,500.0 | 1,500.0 | |||||||||
0% Notes due 2027 | 804.9 | 804.9 | |||||||||
3.875% Notes due 2028 (2) | 700.0 | 700.0 | |||||||||
| Gross long-term debt, including current maturities | 3,004.9 | 3,379.9 | |||||||||
Less: Unamortized debt discount (3) | (2.5) | (3.4) | |||||||||
Less: Unamortized debt issuance costs (4) | (21.9) | (30.6) | |||||||||
| Net long-term debt | $ | 2,980.5 | $ | 3,345.9 | |||||||
(1)Interest is payable on March 1 and September 1 of each year at 0.50% annually.
(2)Fixed rate note due September 1, 2028 with interest payable on March 1 and September 1 of each year at 3.875% annually.
(3)Debt discount of $2.5 million and $3.4 million for the 3.875% Notes as of December 31, 2025 and December 31, 2024, respectively.
(4)Debt issuance costs of $16.5 million and $21.7 million for the 0.50% Notes, $4.5 million and $7.7 million for the 0% Notes, $0.9 million and $1.2 million for the 3.875% Notes, in each case as of December 31, 2025 and December 31, 2024, respectively.
The Company’s long-term debt instruments are senior unsecured obligations and are fully and unconditionally guaranteed, on a joint and several basis, by each of the Company’s subsidiaries that is a borrower or guarantor under the Revolving Credit Facility.
Maturities
Expected maturities of gross long-term debt as of December 31, 2025 are as follows (in millions):
| Expected Maturities | |||||
| 2026 | $ | — | |||
| 2027 | 804.9 | ||||
| 2028 | 700.0 | ||||
| 2029 | 1,500.0 | ||||
| 2030 | — | ||||
| Thereafter | — | ||||
| Total | $ | 3,004.9 | |||
Revolving Credit Facility
In 2023, the Company entered into a new $1.5 billion Revolving Credit Facility. On December 31, 2025, the Company repaid $375.0 million of borrowings that were outstanding on the Revolving Credit Facility. As of December 31, 2025, the Company had approximately $1.5 billion available under the Revolving Credit Facility for future borrowings, except for amounts utilized for the letters of credit. Future borrowings are available for general corporate purposes, including working capital, capital expenditures, and acquisitions, but also include a $25.0 million sub-limit for the issuance of letters of credit and a foreign currency sub-limit of $75.0 million.
The maturity date for the borrowings under the Credit Agreement is June 22, 2028. Interest is payable based on either Secured Overnight Financing Rate (“SOFR”) or base rate options, as established at the commencement of each borrowing period, plus an applicable rate that varies based on the total leverage ratio. Lenders are owed certain fees, including a commitment fee that varies based on the total leverage ratio. The Company may prepay loans under the Credit Agreement at any time, in whole or in part, upon payment of accrued interest and break funding payments, if applicable. As of December 31, 2025, there were no borrowings outstanding on the Revolving Credit Facility, and as such, no related interest rate. As of December 31, 2024, the interest rate for borrowings on the Revolving Credit Facility was 5.69%.
The obligations are guaranteed by certain of the Company’s domestic subsidiaries and SCI LLC and are collateralized by, among other things, a pledge of the equity interests in certain of the Company’s and SCI LLC’s domestic subsidiaries and material first tier foreign subsidiaries. The affirmative and negative covenants are customary for credit agreements of this nature. The Credit Agreement contains customary events of default, the occurrence of which could result in the acceleration of the associated obligations. The financial covenant relates to a maximum total net leverage ratio of 4.00 to 1.00 calculated using the consolidated total indebtedness to consolidated earnings before interest, taxes, depreciation and amortization and other adjustments for the trailing four consecutive quarters. The Company was in compliance with the total net leverage ratio as of December 31, 2025.
0.50% Notes and 0% Notes
The 0.50% Notes and 0% Notes are convertible and will mature on March 1, 2029 and May 1, 2027, respectively, unless earlier repurchased or redeemed by the Company or converted pursuant to their terms. The maximum number of shares of common stock issuable in connection with the conversion of the 0.50% Notes and 0% Notes is approximately 19.1 million and 21.7 million, respectively. As of December 31, 2025, neither the 0.50% Notes nor the 0% Notes were eligible for conversion by noteholders and as such, the 0% Notes were reclassified from current to long-term as of December 31, 2025. On or after the first business day of the month immediately prior to each note’s respective maturity date, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the notes may convert all or a portion of their respective notes at any time.
The Company may redeem for cash all or any portion of the notes, at the Company’s option, on or after March 6, 2026 and May 1, 2024 in the case of the 0.50% Notes and 0% Notes, respectively, if the last reported sale price of the Company’s common stock has been at least 130% ($135.03 and $68.86 for the 0.50% Notes and 0% Notes, respectively) of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides the related notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The Company has not elected to redeem any portion of the 0% Notes. Prior to the respective dates upon which the holders may convert their notes at any time, the holders may convert their notes at their option only under the following circumstances: (i) during any calendar quarter commencing after the calendar quarter ending on December 31, 2025 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (ii) during the consecutive business-day period after any five consecutive trading-day period in which the trading price per $1,000 principal amount of the notes for each trading day of such period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; (iii) if the Company calls any or all of the notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (iv) upon the occurrence of specified corporate transactions described in each note's respective indenture agreement. The if-converted value of the 0% Notes exceeded its principal amount by $0.0 million as of December 31, 2025, calculated using the stock price on that date.
The Company also entered into warrant transactions with certain other financial institutions, whereby the Company sold warrants to acquire 14.4 million and 15.2 million shares of the Company's common stock with respect to the 0.50% Notes and 0% Notes, respectively. The number of shares of the Company’s common stock acquired for each sale of warrants is the same covered by the associated convertible note. The maximum number of shares of common stock issuable in connection with the warrants is approximately 28.9 million and 30.4 million with respect to the 0.50% Notes and 0% Notes, respectively.
In addition, for the 0.50% Notes and 0% Notes, the Company entered into convertible note hedge transactions with respect to the common stock with the initial purchasers or their affiliates and certain other financial institutions. The Company will exercise the note hedges simultaneously when the notes are settled. The convertible note hedges cover, subject to customary anti-dilution adjustments, the number of shares of common stock that initially underlie the associated note and that are expected to reduce the potential dilution to the common stock and/or offset potential cash payments in excess of the principal amount upon conversion of the notes.
The Company analyzed both the warrant and convertible note hedge transactions under ASC 815-40 - "Derivatives and Hedging - Contracts in Entity's Own Equity" and determined that the instruments met the criteria for classification as an equity transaction with no subsequent remeasurement.
See Note 10: ''Earnings Per Share and Equity'' for more information regarding outstanding warrants and convertible note hedges.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 9, 2026 | Showing above |
| 2024 | Feb 10, 2025 | |
| 2023 | Feb 5, 2024 | |
| 2022 | Feb 6, 2023 | |
| 2021 | Feb 14, 2022 | |
| 2020 | Feb 16, 2021 | |
| 2019 | Feb 19, 2020 | |
| 2018 | Feb 20, 2019 | |
| 2017 | Feb 21, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 24, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.