On Semiconductor
(
ONNN
) recently launched two new power management integrated circuits
(PMICs), namely NCP6924 and NCP6914, for better battery life in
phones and other portable electronic items.
PMICs are used for managing power usage in their host devices
such as smartphones, tablets, digital cameras, GPS systems and
other portable devices. The main functions of PMIC in power
management are DC-to-DC conversion, battery charging, selection of
power source, voltage fluctuation management and other
miscellaneous functions.
On Semi realizes the importance of efficient power management
and it constantly launches new products in the power management
segment. The recently-launched products are intended to enhance the
performance of computing and game consoles.
Currently, smartphones, tablets and ultrabooks are the
most-talked-about and hottest-selling electronic gadgets. The
popularity behind smartphones and tablets are their slimmer and
lighter build, multi-tasking capabilities such as easy availability
of social networking sites (Facebook, Twitter), viewing videos, and
Internet connectivity among others. Hence, the importance of power
management in these devices rises as these applications can drain
out the power in the devices very easily.
Further, reports from multiple market research companies suggest
that smartphone units may reach 1.179 billion, growing at a CAGR of
21.0% to 2016, tablets 311 million units (39.0%) and ultrabooks 121
million units (59.0%).
Therefore, it is apparent that the smartphone, tablets, digital
cameras and other portable device markets will see very strong
growth, which will boost ON Semi's power management business.
Of course, other IC makers such as
Maxim Integrated Products
(
MXIM
),
Linear Technology
(
LLTC
) and
Texas Instruments
(
TXN
) also produce PMICs, so On Semiconductor will continue to see
stiff competition going forward.
ON Semi reported revenues of $744.8 million in the second
quarter of fiscal 2012, flat sequentially and down 17.8% year over
year and in the middle of management's guidance range of
$720.0-760.0 million, or down 1-6% sequentially.
On a pro forma basis, the company reported a net income of $51.1
million, or a 6.9% net income margin compared with $52.4 million,
or 6.8% in the previous quarter and $113.2 million or 13.0% in the
first quarter of 2012.
Currently, On Semiconductor has a Zacks #3 Rank, implying a Hold
rating in the short-term (1-3 months).
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