ON Semiconductor Corporation stock research
FY2024 Q1
ON Semiconductor (ON) Gross Margin — Quarter Ended Mar 29, 2024
Gross margin weakened as revenue decreased while cost of revenue remained relatively unchanged year-over-year. Sequentially, both revenue and cost of revenue declined, but the gross profit decline was more pronounced, leading to a lower gross margin.
Gross margin takeaway
Quarter ended Mar 29, 2024 · FY2024 Q1
Gross margin weakened as revenue decreased while cost of revenue remained relatively unchanged year-over-year. Sequentially, both revenue and cost of revenue declined, but the gross profit decline was more pronounced, leading to a lower gross margin.
- The relationship among revenue, gross profit, and cost of revenue shows that gross margin was lower primarily because revenue declined while cost of revenue stayed nearly flat compared to the same quarter last year. Sequentially, cost of revenue decreased at a similar absolute amount to revenue, but the starting margin base caused gross profit to fall more sharply.
- Compared to the immediately preceding quarter, revenue and gross profit were both lower, and gross margin weakened. Versus the same quarter one year earlier, revenue and gross profit were also lower, with gross margin declining as cost of revenue remained unchanged.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
45.8%
Gross profit
$853.6M
Revenue
$1.9B
Cost of revenue
$1.0B
Quarter-over-quarter change
-0.8 pts
Year-over-year change
-1.0 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jun 30, 2023 | $2.1B | $993.4M | $1.1B | 47.4% |
| Sep 29, 2023 | $2.2B | $1.0B | $1.2B | 47.3% |
| Dec 31, 2023 | $2.0B | $941.9M | $1.1B | 46.7% |
| Mar 29, 2024 | $1.9B | $853.6M | $1.0B | 45.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
-0.8 pts
Year-over-year change
Mar 31, 2023
-1.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The relationship among revenue, gross profit, and cost of revenue shows that gross margin was lower primarily because revenue declined while cost of revenue stayed nearly flat compared to the same quarter last year. Sequentially, cost of revenue decreased at a similar absolute amount to revenue, but the starting margin base caused gross profit to fall more sharply.
Compared to the immediately preceding quarter, revenue and gross profit were both lower, and gross margin weakened. Versus the same quarter one year earlier, revenue and gross profit were also lower, with gross margin declining as cost of revenue remained unchanged.
Monitor capital expenditure levels, particularly those directed toward manufacturing equipment, as noted in the liquidity discussion, since they may influence future cost structure.