Chipmaker Onsemi on Monday forecast third-quarter revenue above Wall Street expectations, betting on surging demand for power management chips used in AI data centers.
Onsemi's results come as it looks to its biggest deal yet, a $7 billion all-stock acquisition of Synaptics announced in June, to tap into growing demand from AI devices and robotics.
Onsemi forecast its third-quarter revenue in the range of $1.65 billion to $1.75 billion, the midpoint of which is above analysts' average estimate of $1.67 billion, according to LSEG data.
"AI data center remains our fastest-growing business and we now expect revenue to more than double in 2026, demonstrating the strength of our intelligent power portfolio and growing customer adoption across the power tree," CEO Hassane El-Khoury said.
The company posted second-quarter revenue of $1.6 billion, in line with expectations of $1.59 billion.
Adjusted earnings per share came in at $0.74, above estimates of $0.71.
It expects third-quarter adjusted EPS in the range of $0.81 to $0.93, the midpoint of which is above estimates of $0.83.
Shares of the company were down 1.5% after the bell.
Onsemi is also pressing ahead with its "Fab Right" strategy to cut costs. In July, it sold two of its manufacturing facilities as part of this strategy.
