ON SEMICONDUCTOR CORPON
ON SEMICONDUCTOR CORP Segments Disclosure
Note 3: Segments and Revenue
Segments
As of December 31, 2025, the Company was organized into three operating and reportable segments consisting of PSG, AMG and ISG. These segments represent management's view of the business for which separate financial information is available and evaluated regularly by the Chief Operating Decision Maker ("CODM"), which is the Company’s Chief Executive Officer. The CODM uses segment gross profit for evaluating product pricing, factory utilization, allocation of capital and the assessment of segment profitability. The operating costs of manufacturing facilities which service all business units are reflected in each segment's cost of revenue on the basis of product costs. Because operating segments are generally defined by the products they design and sell, they do not sell to each other. The Company does not allocate income taxes or interest expense to its operating segments as the operating segments are principally evaluated on gross profit. Additionally, restructuring, asset impairments and other charges and certain other operating expenses, which include corporate research and development costs and miscellaneous nonrecurring expenses, are not allocated to segments.
Revenue and gross profit for the Company’s operating and reportable segments were as follows (in millions):
| PSG | AMG | ISG | Total | ||||||||||||||||||||
| Year ended December 31, 2025: | |||||||||||||||||||||||
| Revenue from external customers | $ | 2,805.1 | $ | 2,261.9 | $ | 928.4 | $ | 5,995.4 | |||||||||||||||
| Cost of revenue | 2,117.6 | 1,105.4 | 788.5 | 4,011.5 | |||||||||||||||||||
| Segment gross profit | $ | 687.5 | $ | 1,156.5 | $ | 139.9 | $ | 1,983.9 | |||||||||||||||
| Year ended December 31, 2024: | |||||||||||||||||||||||
| Revenue from external customers | $ | 3,348.2 | $ | 2,609.1 | $ | 1,125.0 | $ | 7,082.3 | |||||||||||||||
| Cost of revenue | 1,963.8 | 1,302.8 | 599.6 | 3,866.2 | |||||||||||||||||||
| Segment gross profit | $ | 1,384.4 | $ | 1,306.3 | $ | 525.4 | $ | 3,216.1 | |||||||||||||||
| Year ended December 31, 2023: | |||||||||||||||||||||||
| Revenue from external customers | $ | 3,880.4 | $ | 3,057.1 | $ | 1,315.5 | $ | 8,253.0 | |||||||||||||||
| Cost of revenue | 2,058.5 | 1,635.8 | 675.2 | 4,369.5 | |||||||||||||||||||
| Segment gross profit | $ | 1,821.9 | $ | 1,421.3 | $ | 640.3 | $ | 3,883.5 | |||||||||||||||
The Company had one customer, a distributor, whose revenue accounted for approximately 11% and 10% of total revenue for the years ended December 31, 2025 and 2024, respectively, with sales across all reportable segments. No customer exceeded 10% of the total revenue for the year ended December 31, 2023. One customer, a distributor, accounted for approximately 10% and 13% of the Company's accounts receivable balance as of December 31, 2025 and 2024, respectively.
Revenue for the Company's operating and reportable segments disaggregated into geographic locations based on sales billed from the respective country and sales channels was as follows (in millions):
| Year ended December 31, 2025 | |||||||||||||||||||||||
| PSG | AMG | ISG | Total | ||||||||||||||||||||
| Geographic Location: | |||||||||||||||||||||||
| Hong Kong | $ | 796.5 | $ | 622.0 | $ | 216.3 | $ | 1,634.8 | |||||||||||||||
| United Kingdom | 596.5 | 438.2 | 312.3 | 1,347.0 | |||||||||||||||||||
| Singapore | 689.4 | 476.9 | 86.1 | 1,252.4 | |||||||||||||||||||
| United States | 507.5 | 576.4 | 146.7 | 1,230.6 | |||||||||||||||||||
| Other | 215.2 | 148.4 | 167.0 | 530.6 | |||||||||||||||||||
| Total | $ | 2,805.1 | $ | 2,261.9 | $ | 928.4 | $ | 5,995.4 | |||||||||||||||
| Sales Channel: | |||||||||||||||||||||||
| Distributors | $ | 1,650.7 | $ | 1,191.2 | $ | 425.5 | $ | 3,267.4 | |||||||||||||||
| Direct Customers | 1,154.4 | 1,070.7 | 502.9 | 2,728.0 | |||||||||||||||||||
| Total | $ | 2,805.1 | $ | 2,261.9 | $ | 928.4 | $ | 5,995.4 | |||||||||||||||
| Year ended December 31, 2024 | |||||||||||||||||||||||
| PSG | AMG | ISG | Total | ||||||||||||||||||||
| Geographic Location: | |||||||||||||||||||||||
| Hong Kong | $ | 876.1 | $ | 661.6 | $ | 241.6 | $ | 1,779.3 | |||||||||||||||
| Singapore | 991.0 | 617.1 | 125.1 | 1,733.2 | |||||||||||||||||||
| United Kingdom | 712.8 | 502.5 | 422.5 | 1,637.8 | |||||||||||||||||||
| United States | 525.4 | 596.7 | 185.4 | 1,307.5 | |||||||||||||||||||
| Other | 242.9 | 231.2 | 150.4 | 624.5 | |||||||||||||||||||
| Total | $ | 3,348.2 | $ | 2,609.1 | $ | 1,125.0 | $ | 7,082.3 | |||||||||||||||
| Sales Channel: | |||||||||||||||||||||||
| Distributors | $ | 2,051.5 | $ | 1,338.7 | $ | 369.4 | $ | 3,759.6 | |||||||||||||||
| Direct Customers | 1,296.7 | 1,270.4 | 755.6 | 3,322.7 | |||||||||||||||||||
| Total | $ | 3,348.2 | $ | 2,609.1 | $ | 1,125.0 | $ | 7,082.3 | |||||||||||||||
| Year ended December 31, 2023 | |||||||||||||||||||||||
| PSG | AMG | ISG | Total | ||||||||||||||||||||
| Geographic Location: | |||||||||||||||||||||||
| Hong Kong | 1,151.7 | 764.2 | 252.7 | 2,168.6 | |||||||||||||||||||
| Singapore | 1,095.1 | 640.4 | 203.3 | 1,938.8 | |||||||||||||||||||
| United Kingdom | 769.9 | 647.6 | 335.9 | 1,753.4 | |||||||||||||||||||
| United States | 604.3 | 642.1 | 327.3 | 1,573.7 | |||||||||||||||||||
| Other | 259.4 | 362.8 | 196.3 | 818.5 | |||||||||||||||||||
| Total | $ | 3,880.4 | $ | 3,057.1 | $ | 1,315.5 | $ | 8,253.0 | |||||||||||||||
| Sales Channel: | |||||||||||||||||||||||
| Distributors | $ | 2,238.6 | $ | 1,494.2 | $ | 576.3 | $ | 4,309.1 | |||||||||||||||
| Direct Customers | 1,641.8 | 1,562.9 | 739.2 | 3,943.9 | |||||||||||||||||||
| Total | $ | 3,880.4 | $ | 3,057.1 | $ | 1,315.5 | $ | 8,253.0 | |||||||||||||||
The Company operates in various geographic locations. Sales to external customers have little correlation to where products are manufactured or the location of the end-customer. The Company believes it is, therefore, not meaningful to present operating profit by geographical location.
The following table illustrates the product technologies under each of the Company's reportable segments based on the Company's operating strategy. Because many products are sold into different end-markets, the total revenue reported for a segment is not indicative of actual sales in the end-market associated with that segment, but rather is the sum of the revenue from the product lines assigned to that segment. These segments represent the Company's view of the business and, as such, are used to evaluate progress of major initiatives and allocation of resources.
| PSG | AMG | ISG | ||||||||||||
| SiC products | Analog products | Actuator Drivers | ||||||||||||
| SiC JFET products | ASIC products | CMOS image sensors | ||||||||||||
| Discrete products | Logic and Isolation products | Image Signal Processors | ||||||||||||
| MOSFET products | Non-Volatile Memory products | Single Photon Detectors | ||||||||||||
| Power Module products | Ultrasonic | Short-Wavelength Infrared | ||||||||||||
| Vertical GaN | Inductive sensing | Indirect Time of Flight sensors | ||||||||||||
| Gate Driver products | ||||||||||||||
The Company does not discretely allocate assets to its operating segments, nor does management evaluate operating segments using discrete asset information. The Company’s consolidated assets used in manufacturing are generally shared across and are not specifically ascribed to operating and reportable segments.
Property, plant and equipment, net by geographic location, is summarized below (in millions):
| As of December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| South Korea | $ | 1,175.3 | $ | 1,423.8 | |||||||
| United States | 1,046.8 | 1,410.8 | |||||||||
| Czech Republic | 398.0 | 612.3 | |||||||||
| China | 186.0 | 228.8 | |||||||||
| Philippines | 169.8 | 208.1 | |||||||||
| Malaysia | 147.3 | 183.1 | |||||||||
| Vietnam | 132.6 | 155.3 | |||||||||
| Other | 113.2 | 139.2 | |||||||||
| Total | $ | 3,369.0 | $ | 4,361.4 | |||||||
Revenue
The Company's revenue is derived primarily from product sales, and to a much lesser extent, from product development agreements. Revenue recognized from product sales as a percentage of total revenue was approximately 99%, 99% and 97% for the years ended December 31, 2025, 2024 and 2023, respectively. Revenue recognized from product development agreements as a percentage of total revenue was approximately 1%, 1% and 3% for the years ended December 31, 2025, 2024 and 2023, respectively.
The Company's revenue disaggregated into end-markets and product technologies was as follows (in millions):
| Year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| End-Markets: | |||||||||||||||||
| Automotive | $ | 3,080.8 | $ | 3,900.8 | $ | 4,319.9 | |||||||||||
| Industrial | 1,674.8 | 1,800.8 | 2,278.4 | ||||||||||||||
| Other* | 1,239.8 | 1,380.7 | 1,654.7 | ||||||||||||||
| Total | $ | 5,995.4 | $ | 7,082.3 | $ | 8,253.0 | |||||||||||
| * Other includes the end-markets of computing (including AI data center), consumer, networking, communications, etc. | |||||||||||||||||
| Product Technologies: | |||||||||||||||||
| Intelligent Power | $ | 3,009.4 | $ | 3,648.6 | $ | 4,214.8 | |||||||||||
| Intelligent Sensing | 1,163.6 | 1,379.2 | 1,606.8 | ||||||||||||||
| Other | 1,822.4 | 2,054.5 | 2,431.4 | ||||||||||||||
| Total | $ | 5,995.4 | $ | 7,082.3 | $ | 8,253.0 | |||||||||||
Remaining Performance Obligations
A portion of the Company’s orders are firm commitments that are non-cancelable, including certain orders or contracts with a duration of less than one year. Certain of the Company's customer contracts are multi-year agreements that include committed amounts ("Long-term Supply Agreements" or "LTSAs") for which the remaining performance obligations as of December 31, 2025 were approximately $7.1 billion (excluding the remaining performance obligations for contracts having a duration of one year or less). If products are shipped according to the terms of these contracts, the Company expects to recognize approximately 34% of this amount as revenue during the next 12 months. Total revenue estimates are based on negotiated contract prices and demand quantities, and could be influenced by risks and uncertainties, including manufacturing or supply chain constraints, modifications to customer agreements, and regulatory changes, among other factors. The timing, pricing or amounts of products delivered under LTSAs may be modified or canceled in certain circumstances, and the actual revenue recognized for the remaining performance obligations in future periods may significantly differ from current estimates. During 2025, certain LTSAs were modified in response to changes in demand. Modifications primarily related to delivery schedules and volume
commitments. The Company assessed each modification to determine whether it represented a contract modification or a change in estimate.
Certain LTSAs include non-cancelable capacity payments from the customer, which are generally due within 30 days of agreement. These payments reserve production availability or are prepayments for the same purpose and are not recognized as revenue until the performance obligations are satisfied. Payments received in advance of the satisfaction of performance obligations are recorded as contract liabilities. During the years ended December 31, 2025 and 2024, $126.1 million and $110.9 million, respectively, were recognized as revenue for satisfying the associated performance obligations.
Contract assets and contract liabilities were as follows (in millions):
| As of December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Contract assets included in: | |||||||||||
| Other current assets | $ | 47.4 | $ | 39.9 | |||||||
| Contract liabilities included in: | |||||||||||
| Accrued expenses and other current liabilities | $ | 51.8 | $ | 98.2 | |||||||
| Other long-term liabilities | 69.8 | 120.9 | |||||||||
| Total | $ | 121.6 | $ | 219.1 | |||||||
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 Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.