Analysis of Geographic Areas
ON Semiconductor Corp. operates in 2 regions: United States and Other.
Area Asset Turnover
ON Semiconductor Corp., asset turnover by geographic area
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| United States | 1.08 | 1.10 | 1.21 | 1.06 | 1.31 |
| Other | 2.27 | 3.23 | 3.31 | 2.48 | 2.38 |
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).
Asset turnover ratios across different geographic segments exhibit distinct performance patterns and efficiency levels between 2019 and 2023. A consistent disparity is observed, with assets located in regions outside the United States generating significantly higher revenue per unit of investment compared to domestic assets.
- United States Asset Turnover
- The domestic asset turnover ratio demonstrates a general downward trend characterized by moderate volatility. From a peak of 1.31 in 2019, the ratio declined to 1.06 in 2020, experienced a temporary recovery to 1.21 in 2021, and subsequently trended lower to finish at 1.08 by the end of 2023. This indicates a reduction in the efficiency of domestic asset utilization over the five-year period.
- Other Geographic Areas Asset Turnover
- International operations show a more pronounced cycle of growth and contraction. The turnover ratio increased from 2.38 in 2019 to a peak of 3.31 in 2021, reflecting a period of intensified asset efficiency. However, this was followed by a decline to 3.23 in 2022 and a significant correction to 2.27 in 2023. Despite this recent decrease, the efficiency in these regions remains substantially higher than in the United States.
- Comparative Geographic Analysis
- The efficiency gap between the two geographic areas reached its widest point in 2021, where the "Other" segment outperformed the United States by a factor of approximately 2.7. By 2023, a convergence trend is evident, as the international turnover ratio experienced a sharper decline than the domestic ratio, although the international segment continues to maintain a superior asset turnover profile.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?
Area Asset Turnover: United States
ON Semiconductor Corp.; United States; area asset turnover calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenue | 1,573,700) | 1,464,700) | 931,600) | 728,600) | 810,300) |
| Property, plant and equipment, net | 1,456,500) | 1,329,200) | 767,100) | 686,600) | 616,700) |
| Area Activity Ratio | |||||
| Area asset turnover1 | 1.08 | 1.10 | 1.21 | 1.06 | 1.31 |
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).
1 2023 Calculation
Area asset turnover = Revenue ÷ Property, plant and equipment, net
= 1,573,700 ÷ 1,456,500 = 1.08
The financial trajectory for the United States geographic area is characterized by aggressive capital expansion and substantial revenue growth over the five-year period ending December 31, 2023. While revenue has increased significantly, the pace of investment in property, plant, and equipment has been more pronounced, particularly during the latter half of the analyzed period.
- Revenue Growth Patterns
- Revenue experienced a temporary contraction in 2020, declining to $728.6 million from $810.3 million in 2019. This was followed by a strong recovery and acceleration, with a significant jump to $1.46 billion in 2022 and further growth to $1.57 billion by the end of 2023. This represents a total increase of approximately 94% relative to 2019 levels.
- Capital Expenditure and Asset Base
- A consistent upward trend in net property, plant, and equipment is observed, with a sharp escalation occurring between 2021 and 2022, where assets rose from $767.1 million to $1.33 billion. By December 31, 2023, the asset base reached $1.46 billion, indicating a strategic commitment to significant capacity expansion within the U.S. market.
- Area Asset Turnover Efficiency
- The area asset turnover ratio has exhibited a general downward trend, decreasing from 1.31 in 2019 to 1.08 in 2023. Despite a temporary improvement to 1.21 in 2021, the ratio declined in subsequent years. This suggests that the growth in the asset base has outpaced the growth in revenue generation, reflecting a period where capital investments have not yet achieved their full revenue-generating potential.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?
Area Asset Turnover: Other
ON Semiconductor Corp.; Other; area asset turnover calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenue | 6,679,300) | 6,861,500) | 5,808,200) | 4,526,400) | 4,707,600) |
| Property, plant and equipment, net | 2,945,000) | 2,121,500) | 1,757,200) | 1,825,700) | 1,974,900) |
| Area Activity Ratio | |||||
| Area asset turnover1 | 2.27 | 3.23 | 3.31 | 2.48 | 2.38 |
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).
1 2023 Calculation
Area asset turnover = Revenue ÷ Property, plant and equipment, net
= 6,679,300 ÷ 2,945,000 = 2.27
The financial performance from 2019 to 2023 reflects a period of revenue expansion followed by significant capital reinvestment, which has fundamentally altered the efficiency of asset utilization.
- Revenue Performance
- Revenue experienced a slight contraction in 2020 before entering a period of rapid growth, peaking at 6,861,500 thousand US dollars in 2022. A marginal decline was noted in 2023, with revenue settling at 6,679,300 thousand US dollars.
- Capital Expenditure and Asset Base
- Net property, plant, and equipment showed a downward trend between 2019 and 2021, reaching a low of 1,757,200 thousand US dollars. A sharp reversal occurred starting in 2022, culminating in a significant increase to 2,945,000 thousand US dollars by the end of 2023, indicating an aggressive expansion of the fixed asset base.
- Area Asset Turnover Efficiency
- The area asset turnover ratio demonstrates a non-linear trajectory, rising from 2.38 in 2019 to a peak of 3.31 in 2021. This peak coincided with the period where the asset base was at its minimum while revenues were climbing. A subsequent decline is observed, with the ratio falling to 2.27 in 2023. This compression is attributed to the substantial increase in net property, plant, and equipment outstripping revenue growth during the final two years of the period.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?
Revenue
ON Semiconductor Corp., revenue by geographic area
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| United States | 1,573,700) | 1,464,700) | 931,600) | 728,600) | 810,300) |
| Other | 6,679,300) | 6,861,500) | 5,808,200) | 4,526,400) | 4,707,600) |
| Total | 8,253,000) | 8,326,200) | 6,739,800) | 5,255,000) | 5,517,900) |
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).
Total revenue exhibited a volatile yet generally upward trajectory between 2019 and 2023. A contraction occurred in 2020, followed by a period of rapid expansion peaking in 2022, before a marginal decline was recorded in 2023.
- Total Revenue Performance
- Aggregate revenue increased from 5.52 billion in 2019 to 8.25 billion in 2023. The most significant growth phase was observed between 2021 and 2022, during which total revenue expanded by approximately 23.5%.
- United States Market Growth
- The domestic market demonstrated the most consistent growth pattern over the latter half of the period. Following a decline in 2020, US revenue expanded from 728.6 million to 1.57 billion by 2023, representing an increase of approximately 116% from the 2020 trough.
- International Revenue Performance
- Revenue from regions outside the United States remains the primary driver of total income. This segment grew from 4.71 billion in 2019 to a peak of 6.86 billion in 2022, before experiencing a slight contraction to 6.68 billion in 2023.
- Geographic Revenue Mix Shift
- A notable shift in geographic concentration is observable. The United States' contribution to total revenue rose from 14.7% in 2019 to 19.1% in 2023, indicating a strengthening of the domestic market position relative to international operations.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?
Property, plant and equipment, net
ON Semiconductor Corp., property, plant and equipment, net by geographic area
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| United States | 1,456,500) | 1,329,200) | 767,100) | 686,600) | 616,700) |
| Other | 2,945,000) | 2,121,500) | 1,757,200) | 1,825,700) | 1,974,900) |
| Total | 4,401,500) | 3,450,700) | 2,524,300) | 2,512,300) | 2,591,600) |
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).
Net property, plant, and equipment (PP&E) exhibited a period of relative stability between 2019 and 2021, followed by a phase of aggressive capital expansion starting in 2022. Total assets grew from US$ 2,591,600 thousand in 2019 to US$ 4,401,500 thousand by December 31, 2023, representing a total increase of approximately 69.8% over the five-year period.
- Total Capital Expenditure Trends
- The total net PP&E remained nearly flat from 2019 to 2021, with a marginal decrease in 2020 and a slight recovery in 2021. However, a significant pivot occurred in 2022, where total assets increased by approximately 36.7% in a single year, followed by another 27.5% increase in 2023. This indicates a strategic acceleration in capacity investment during the latter part of the period.
- Domestic Asset Growth (United States)
- Investment within the United States showed consistent upward momentum throughout the entire period. Assets grew steadily from US$ 616,700 thousand in 2019 to US$ 767,100 thousand in 2021. A substantial surge was recorded in 2022, with the value jumping to US$ 1,329,200 thousand, nearly doubling the 2021 balance. By the end of 2023, domestic PP&E reached US$ 1,456,500 thousand, marking a total increase of 136.2% since 2019.
- International Asset Dynamics (Other)
- Assets categorized as "Other" initially experienced a downward trend, declining from US$ 1,974,900 thousand in 2019 to a low of US$ 1,757,200 thousand in 2021. This contraction was reversed in 2022, with assets rising to US$ 2,121,500 thousand, and further accelerating in 2023 to reach US$ 2,945,000 thousand. The rapid growth in international assets between 2021 and 2023 reflects a renewed focus on global infrastructure expansion.
- Geographic Allocation Shift
- The distribution of assets shifted toward a higher concentration in the United States between 2019 and 2022. The domestic portion of total PP&E rose from approximately 23.8% in 2019 to a peak of 38.5% in 2022. While international assets grew significantly in 2023, the domestic share remained substantially higher than its 2019 baseline, settling at 33.1% of the total net PP&E by the end of 2023.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?