A cyclical power-semiconductor leader with credible upside if AI data-center power becomes a durable, platform-level socket. The main swing factors are utilization recovery and whether hyperscalers commoditize the layer.

As AI data-center power becomes a binding constraint and EV/grid power content rises, onsemi’s vertically integrated power stack plus aggressive buybacks can compound through the cycle—if it upgrades from “component sockets” to repeatable rack-level and protection platforms.

Energy efficiency and power delivery are first-order constraints in AI + electrification; onsemi is a key enabler, though moats are weaker than software/platform businesses.

The core bet is “more watts, more conversions, more protection”: AI racks, EV powertrains, and grid storage add power content per system, while customers increasingly pay for efficiency, thermal performance, and reliability. onsemi’s vertical integration in wide-bandgap power, owned manufacturing footprint, and long-cycle qualification help it hold premium mix and defend share. The upside case is amplified by sustained repurchases that increase per-share torque through the cycle.

The key risks are (1) cycle timing and factory utilization, (2) hyperscaler/ODM multi-sourcing that commoditizes AI power, (3) capital intensity amplifying mistakes, and (4) geopolitical/export-policy shocks affecting supply chains and end demand.

$59.63