Yesterday, ON Semiconductor Corporation published its half-year results. In a sector hit by a very sharp economic downturn, the US group continues to show excellent health and promising development prospects. 
 
It's true that demand remains buoyant in its main market - the automotive industry. Equipment designed by ON - sensors, transistors, advanced materials such as silicon carbide, among others - is increasingly ubiquitous, particularly in the production of electric vehicles. 
 
With the reconfiguration of its business portfolio, ON expects to see demand for its components increase by almost thirty times per vehicle. This aggressive ambition is borne out by sales to the automotive sector, up 35% on the first half of the previous year. 
 
The Group's other strategic pillar - 5G deployment and industrial automation - has been slow to deliver a comparable performance. Long-term prospects here are naturally excellent, but it takes longer to get the ball rolling. 
 
In financial terms, ON stands out for its impressive growth track record - with sales quadrupling over the last decade - as well as its meticulous management and a particularly astute sequence of share buy-backs. 
 
Capital-intensive imperatives have meant that profits and cash flows have stagnated, but the Group has now developed an exhaustive product catalog; multiplied strategic acquisitions, such as Fairchild in 2016 and GT Advanced Technologies in 2021; and developed real vertical integration, all without damaging its balance sheet. 
 
In a sector where scale is essential, ON now expects to reap the rewards of these strategic investments. Management is targeting a gross margin of 45% - exceeded in the first half of 2023 despite widespread price cuts - and the ability to generate $2 billion in profits per year. 
 
Consolidated profit for the first half of the year reached $1.03 billion.