ON Semiconductor Corporation announced that total revenues in the second quarter of 2016 were $877.8 million, up approximately seven percent compared to the first quarter of 2016. During the second quarter of 2016, the company reported GAAP net income of $25.1 million, or $0.06 per diluted share. The second quarter 2016 GAAP net income was negatively impacted by approximately $63.4 million of special items.
ON continues to execute on its Agreement and Plan of Merger with Fairchild Semiconductor International, Inc. by acquiring all of the outstanding shares of Fairchild common stock. The company reported that it continues to work expeditiously to obtain the remaining required regulatory approvals in the U.S. and China in connection with the transaction and expects to close the acquisition around the end of August.
"Our execution momentum continued in the second quarter with strong revenue growth and margin expansion," said Keith Jackson, president and CEO of ON Semiconductor. "We intend to continue on our current trajectory of margin expansion as ongoing optimization of our operations should enable us to deliver further improvements in our margins.
"Traction in our strategic end-markets of automotive, industrial, and mobile devices remains strong, even though the global macroeconomic conditions and overall demand environment continue to be subdued. We remain well positioned to outgrow the semiconductor industry, driven by strength of our product portfolio and design win pipeline."
Total company GAAP and non-GAAP gross margin in the second quarter was 35.1 percent. For the second quarter of 2016, GAAP operating margin was 8.6 percent, and non-GAAP operating margin was 12.3 percent. Adjusted EBITDA for the second quarter of 2016 was $161.7 million. Adjusted EBITDA for the first quarter of 2016 was $141.5 million.
"Based on product booking trends, backlog levels, and estimated turns levels, we anticipate that total ON Semiconductor revenue will be approximately $885 to $925 million in the third quarter of 2016," Jackson said. "Backlog levels for the third quarter of 2016 represent approximately 80 to 85 percent of our anticipated third quarter 2016 revenue. The outlook for the third quarter of 2016 includes stock-based compensation expense of approximately $13 million to $15 million. Net cash paid for income taxes is expected to be $5 million to $9 million."
