ON Semiconductor ON or onsemi is benefiting from accelerating demand for advanced power solutions across AI data centers, electric vehicles (EVs), energy storage and industrial applications. The company's differentiated portfolio of silicon carbide (SiC), gallium nitride (GaN), intelligent power modules and analog power management solutions is driving stronger design wins and content growth, positioning it to outpace broader semiconductor demand.
AI infrastructure has emerged as one of ON Semiconductor's strongest growth drivers. In the first quarter of 2026, AI data center revenues increased more than 30% sequentially, nearly double management's expectations, and the company expects AI data center revenues to double year over year in 2026.
ON is benefiting from broader adoption across the entire power tree, with products deployed from high-voltage power conversion and intelligent power stages to system-level power management. The company is engaged with all major hyperscalers, multiple XPU vendors and leading power supply manufacturers, while more than 30 active programs with Flex Power span power supplies, battery backup systems and next-generation 800-volt DC architectures.
The transition to higher-voltage power architectures is significantly expanding onsemi’s content opportunity. Management expects AI racks to migrate to 800-volt designs, wherein ON’s power content per rack could increase from roughly $15,000 today to approximately $115,000, driven by higher adoption of high-voltage silicon carbide and GaN solutions. The company also believes that its proprietary vertical GaN technology and industry-leading 800-volt power conversion capabilities provide a meaningful competitive advantage in delivering higher power density and improved efficiency for next-generation AI infrastructure.
ON Semiconductor continues to benefit from growing electrification trends. The company remains the preferred power supplier for next-generation 900-volt EV platforms in China, where silicon carbide content continues to expand. At the same time, rising AI-related electricity demand is boosting investments in energy storage systems and microgrids. ON expects its energy storage business to grow more than 40% year over year in 2026, supported by differentiated silicon carbide hybrid modules for utility-scale solar inverters, renewable energy and liquid-cooled storage platforms. These diversified power applications reinforce ON Semiconductor's long-term growth prospects.
ON Faces Tough Competition
On Semiconductor is facing significant competition from the likes of Texas Instruments TXN and Navitas Semiconductor NVTS in the power semiconductors space.
Texas Instruments is gaining traction in the power semiconductor market through broad-based demand across industrial, automotive and AI data center applications. In the first quarter of 2026, analog revenues grew 22% year over year, supported by continued recovery in the industrial markets and accelerating demand from data centers. Data center revenues surged about 90% year over year, while industrial revenues climbed more than 30%, reflecting rising demand for power management, power delivery and analog solutions used in AI infrastructure. The company is also benefiting from long-term secular trends in electrification and AI.
Navitas is gaining momentum by transforming its business toward high-power GaN and SiC solutions for AI infrastructure. The company has shifted away from low-end consumer markets to focus on AI data centers, grid and energy infrastructure, performance computing, and industrial electrification. In the first quarter of 2026, revenues from these high-power markets grew 25% year over year and drove the company's return to sequential revenue growth, with management expecting these businesses to remain the primary growth engine throughout 2026. Navitas is also strengthening its competitive position through differentiated GaN and high-voltage SiC technologies tailored for next-generation AI power architectures.
ON’s Share Price Performance, Valuation & Estimates
Shares of onsemi have appreciated 68.4% year to date, outperforming the broader Zacks Computer and Technology sector’s rise of 14.7%.
ON Stock Outperforms Sector
The ON Semiconductor stock is trading at a premium, with a forward 12-month price/earnings of 24.4X compared with the broader sector’s 22.73X. ON has a Value Score of D.
ON’s Valuation
The Zacks Consensus Estimate for ON’s 2026 earnings is currently pegged at $3.09 per share, up 4.4% over the past 60 days, suggesting 31.5% growth from the 2025 reported figure.
ON Semiconductor Corporation Price and Consensus
ON Semiconductor Corporation price-consensus-chart | ON Semiconductor Corporation Quote
On Semiconductor currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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