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Onsemi forecasts weak fourth quarter on slowing demand for electric vehicles

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Oct 30 (Reuters) – Chipmaker Onsemi (ON.O) forecast fourth-quarter revenue and profit below market expectations on Monday, in a sign that slowing demand for electric vehicles was beginning to hurt orders for its chips from the automotive industry.

Its shares fell 4.4% in trading before the bell as the Arizona-based company supplies chips that go into drive trains of electric cars, as well as those that help with driver-assistance systems like cameras and sensors.

The company, whose clients include European automaker Volkswagen (VOWG_p.DE), forecast revenue in the range of $1.95 billion to $2.05 billion, compared to analysts’ average estimate of $2.18 billion, according to LSEG data.

Tesla’s (TSLA.O) CEO Elon Musk had raised concerns about the impact of high interest rates on car buyers after the world’s most valuable automaker, which is also considered a bellwether for EV industry, missed revenue estimates.

Onsemi forecast its fourth-quarter adjusted diluted earnings per share in the range of $1.13 to $1.27, below analysts’ average estimate of $1.36.

Its third-quarter revenue of $2.18 billion inched past expectations of $2.15 billion. Adjusted earnings of $1.39 per share beat estimates of $1.34.

Reporting by Juby Babu in Bengaluru; Editing by Arun Koyyur

Source: https://www.reuters.com/technology/onsemi-forecasts-weak-fourth-quarter-slowing-demand-electric-vehicles-2023-10-30/