Stock Analysis on Net

ON Semiconductor Corp. (NASDAQ:ON)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

ON Semiconductor Corp., balance sheet: goodwill and intangible assets

US$ in thousands

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Goodwill 1,577,600 1,577,600 1,937,500 1,663,400 1,659,200
Customer relationships 581,500 581,500 581,500 581,500 585,200
Developed technology 939,600 939,600 928,100 794,700 779,500
IPRD 11,600 49,500 64,700
Licenses 30,000 30,000 30,000 30,000 30,000
Other intangibles 79,100 82,700 79,100 79,300 79,300
Intangible assets, original cost 1,630,200 1,633,800 1,630,300 1,535,000 1,538,700
Accumulated amortization (1,238,700) (1,181,900) (1,099,200) (1,005,200) (886,200)
Accumulated impairment losses (92,200) (92,200) (35,400) (60,800) (62,000)
Intangible assets, carrying value 299,300 359,700 495,700 469,000 590,500
Goodwill and intangible assets 1,876,900 1,937,300 2,433,200 2,132,400 2,249,700

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.
Intangible assets, carrying value Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. ON Semiconductor Corp. intangible assets, carrying value decreased from 2021 to 2022 and from 2022 to 2023.
Goodwill and intangible assets Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. ON Semiconductor Corp. goodwill and intangible assets decreased from 2021 to 2022 and from 2022 to 2023.

Adjustments to Financial Statements: Removal of Goodwill

ON Semiconductor Corp., adjustments to financial statements

US$ in thousands

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 13,215,200 11,978,500 9,626,000 8,668,000 8,425,500
Less: Goodwill 1,577,600 1,577,600 1,937,500 1,663,400 1,659,200
Total assets (adjusted) 11,637,600 10,400,900 7,688,500 7,004,600 6,766,300
Adjustment to Total ON Semiconductor Corporation Stockholders’ Equity
Total ON Semiconductor Corporation stockholders’ equity (as reported) 7,782,600 6,188,500 4,585,400 3,538,500 3,301,700
Less: Goodwill 1,577,600 1,577,600 1,937,500 1,663,400 1,659,200
Total ON Semiconductor Corporation stockholders’ equity (adjusted) 6,205,000 4,610,900 2,647,900 1,875,100 1,642,500
Adjustment to Net Income Attributable To ON Semiconductor Corporation
Net income attributable to ON Semiconductor Corporation (as reported) 2,183,700 1,902,200 1,009,600 234,200 211,700
Add: Goodwill impairment charges 330,000
Net income attributable to ON Semiconductor Corporation (adjusted) 2,183,700 2,232,200 1,009,600 234,200 211,700

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).


ON Semiconductor Corp., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Goodwill (Summary)

ON Semiconductor Corp., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net Profit Margin
Reported net profit margin 26.46% 22.85% 14.98% 4.46% 3.84%
Adjusted net profit margin 26.46% 26.81% 14.98% 4.46% 3.84%
Total Asset Turnover
Reported total asset turnover 0.62 0.70 0.70 0.61 0.65
Adjusted total asset turnover 0.71 0.80 0.88 0.75 0.82
Financial Leverage
Reported financial leverage 1.70 1.94 2.10 2.45 2.55
Adjusted financial leverage 1.88 2.26 2.90 3.74 4.12
Return on Equity (ROE)
Reported ROE 28.06% 30.74% 22.02% 6.62% 6.41%
Adjusted ROE 35.19% 48.41% 38.13% 12.49% 12.89%
Return on Assets (ROA)
Reported ROA 16.52% 15.88% 10.49% 2.70% 2.51%
Adjusted ROA 18.76% 21.46% 13.13% 3.34% 3.13%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. ON Semiconductor Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. ON Semiconductor Corp. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
ON Semiconductor Corp. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. ON Semiconductor Corp. adjusted ROE improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. ON Semiconductor Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

ON Semiconductor Corp., Financial Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributable to ON Semiconductor Corporation 2,183,700 1,902,200 1,009,600 234,200 211,700
Revenue 8,253,000 8,326,200 6,739,800 5,255,000 5,517,900
Profitability Ratio
Net profit margin1 26.46% 22.85% 14.98% 4.46% 3.84%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income attributable to ON Semiconductor Corporation 2,183,700 2,232,200 1,009,600 234,200 211,700
Revenue 8,253,000 8,326,200 6,739,800 5,255,000 5,517,900
Profitability Ratio
Adjusted net profit margin2 26.46% 26.81% 14.98% 4.46% 3.84%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Net profit margin = 100 × Net income attributable to ON Semiconductor Corporation ÷ Revenue
= 100 × 2,183,700 ÷ 8,253,000 = 26.46%

2 Adjusted net profit margin = 100 × Adjusted net income attributable to ON Semiconductor Corporation ÷ Revenue
= 100 × 2,183,700 ÷ 8,253,000 = 26.46%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. ON Semiconductor Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Revenue 8,253,000 8,326,200 6,739,800 5,255,000 5,517,900
Total assets 13,215,200 11,978,500 9,626,000 8,668,000 8,425,500
Activity Ratio
Total asset turnover1 0.62 0.70 0.70 0.61 0.65
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Revenue 8,253,000 8,326,200 6,739,800 5,255,000 5,517,900
Adjusted total assets 11,637,600 10,400,900 7,688,500 7,004,600 6,766,300
Activity Ratio
Adjusted total asset turnover2 0.71 0.80 0.88 0.75 0.82

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Total asset turnover = Revenue ÷ Total assets
= 8,253,000 ÷ 13,215,200 = 0.62

2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 8,253,000 ÷ 11,637,600 = 0.71

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. ON Semiconductor Corp. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Total assets 13,215,200 11,978,500 9,626,000 8,668,000 8,425,500
Total ON Semiconductor Corporation stockholders’ equity 7,782,600 6,188,500 4,585,400 3,538,500 3,301,700
Solvency Ratio
Financial leverage1 1.70 1.94 2.10 2.45 2.55
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted total assets 11,637,600 10,400,900 7,688,500 7,004,600 6,766,300
Adjusted total ON Semiconductor Corporation stockholders’ equity 6,205,000 4,610,900 2,647,900 1,875,100 1,642,500
Solvency Ratio
Adjusted financial leverage2 1.88 2.26 2.90 3.74 4.12

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total ON Semiconductor Corporation stockholders’ equity
= 13,215,200 ÷ 7,782,600 = 1.70

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total ON Semiconductor Corporation stockholders’ equity
= 11,637,600 ÷ 6,205,000 = 1.88

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
ON Semiconductor Corp. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributable to ON Semiconductor Corporation 2,183,700 1,902,200 1,009,600 234,200 211,700
Total ON Semiconductor Corporation stockholders’ equity 7,782,600 6,188,500 4,585,400 3,538,500 3,301,700
Profitability Ratio
ROE1 28.06% 30.74% 22.02% 6.62% 6.41%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income attributable to ON Semiconductor Corporation 2,183,700 2,232,200 1,009,600 234,200 211,700
Adjusted total ON Semiconductor Corporation stockholders’ equity 6,205,000 4,610,900 2,647,900 1,875,100 1,642,500
Profitability Ratio
Adjusted ROE2 35.19% 48.41% 38.13% 12.49% 12.89%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROE = 100 × Net income attributable to ON Semiconductor Corporation ÷ Total ON Semiconductor Corporation stockholders’ equity
= 100 × 2,183,700 ÷ 7,782,600 = 28.06%

2 Adjusted ROE = 100 × Adjusted net income attributable to ON Semiconductor Corporation ÷ Adjusted total ON Semiconductor Corporation stockholders’ equity
= 100 × 2,183,700 ÷ 6,205,000 = 35.19%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. ON Semiconductor Corp. adjusted ROE improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributable to ON Semiconductor Corporation 2,183,700 1,902,200 1,009,600 234,200 211,700
Total assets 13,215,200 11,978,500 9,626,000 8,668,000 8,425,500
Profitability Ratio
ROA1 16.52% 15.88% 10.49% 2.70% 2.51%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income attributable to ON Semiconductor Corporation 2,183,700 2,232,200 1,009,600 234,200 211,700
Adjusted total assets 11,637,600 10,400,900 7,688,500 7,004,600 6,766,300
Profitability Ratio
Adjusted ROA2 18.76% 21.46% 13.13% 3.34% 3.13%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net income attributable to ON Semiconductor Corporation ÷ Total assets
= 100 × 2,183,700 ÷ 13,215,200 = 16.52%

2 Adjusted ROA = 100 × Adjusted net income attributable to ON Semiconductor Corporation ÷ Adjusted total assets
= 100 × 2,183,700 ÷ 11,637,600 = 18.76%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. ON Semiconductor Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.