Dear Shareholders,
It is with tremendous pride that I write this letter to all our shareholders who have been a part of this incredible journey with us. We recently closed the second fiscal year since the start of our transformation and in 2022, onsemi delivered the most successful year in the company’s history, with record revenue of $8.3 billion, non-GAAP gross margin of 49.2% and non-GAAP earnings per share (EPS) of $5.33. These compare to GAAP figures of 49.0% gross margin and earnings per share of $4.25.
Last year, we committed that disciplined execution would remain our top priority and our worldwide teams delivered on all fronts, remaining steadfast in their dedication to excellence, earning onsemi a position in the prestigious S&P 500.
Our investments focused on high-growth megatrends, improved efficiencies, and rationalizing our manufacturing footprint. We reinforced our position as the leader in intelligent power and sensing technologies for the fastest-growing megatrends in the automotive and industrial markets. With the accelerating demand for electric vehicles, energy infrastructure, and advanced safety applications, onsemi is perfectly positioned to help build a more sustainable future for our customers and future generations.
Customers are choosing onsemi because of the differentiation of our leading-edge technology, the breadth of our portfolio, and our hands-on approach from prototype to production.
Our partner engagement has been an integral part of this success and we have made it a priority to deepen our customer and supplier programs to build partnerships aimed at mutual growth. In 2022, we secured more than $16 billion in long-term supply agreements with companies who choose to partner with onsemi.
We optimized our manufacturing footprint by divesting four subscale fabs while we also completed the acquisition of our East Fishkill fab in New York. This newest addition is now our largest U.S. manufacturing location as well as the only 300mm power discrete and image sensor fab in the country.
We also announced fab expansion plans in South Korea and the Czech Republic for silicon carbide which remains an important growth driver of our business, as the adoption of electric vehicles and alternative energy continues to accelerate. We will continue to invest in expanding our capabilities and capacity, making onsemi the leader for end-to-end silicon carbide solutions in a rapidly growing market.
In addition, 2022 was a milestone year for our Environmental, Social, and Governance (ESG) initiatives. We launched a new corporate global giving program, updated our sustainability strategy, and signed the Science Based Target initiative (SBTi) letter reinforcing our commitment to net zero by 2040. We were recognized for our sustainability efforts by the Dow Jones Sustainability Index North America and Investor Business Daily. In addition, World Finance selected onsemi as the Most Sustainable Company in the Semiconductor Industry for 2022. This award emphasizes onsemi’s continued focus to deliver on the promise of a sustainable future through products and a commitment to achieving net zero by 2040.
Continued operational excellence is imperative as we navigate through 2023. We will remain disciplined in our execution to deliver on our commitments, and we will continue to invest for our long-term growth. We have yet to uncover our full potential and we look forward to delivering for our customers and our shareholders.
Hassane El-Khoury
President and CEO
Read the original letter here.
