0000103730-25-000055
SEC filingRevenue grew 2.8% YoY to $762.3M, but margins compressed due to lower ASPs and higher fixed costs, with net income down 91%.
In Q2 2025, Vishay reported net revenues of $762.3 million, up 2.8% year-over-year and 6.6% sequentially. The increase was driven by higher sales volume (4.3% QoQ, 2.8% YoY) and favorable foreign currency effects (2.3% QoQ, 1.5% YoY), partially offset by lower average selling prices (0.0% QoQ, -2.0% YoY). Gross profit margin was 19.5%, down 250 bps YoY but up 50 bps QoQ, as higher volume was offset by lower ASPs and higher fixed costs, including costs from the Newport wafer fab. Operating margin improved to 2.9% from 0.1% QoQ, but declined from 5.1% YoY; the sequential improvement included an $11.3 million gain from a favorable contingency resolution. Net earnings attributable to Vishay stockholders were $2.0 million ($0.01 per diluted share), compared to $23.5 million ($0.17 per share) in the prior year, reflecting lower gross profit and higher interest expense.
Segment performance was mixed. Resistors led with 8.5% YoY revenue growth to $194.8 million, driven by broad-based demand across regions and end markets, with operating margin of 17.9%. Capacitors grew 6.8% YoY to $121.1 million, but operating margin fell to 16.3% due to higher fixed costs. Inductors revenue rose 1.7% YoY to $95.7 million, with operating margin expanding to 24.0% on higher ASPs and manufacturing efficiencies. Diodes revenue increased 1.1% YoY to $147.9 million, with stable operating margin of 15.0%. Optoelectronic Components grew 2.1% YoY to $54.1 million, with operating margin improving to 12.6% on higher volume and lower utility costs. MOSFETs revenue declined 4.1% YoY to $148.6 million, with operating margin falling to -9.7% due to lower ASPs and Newport wafer fab costs.
Management noted that the prolonged inventory digestion appears to be ending, with book-to-bill above 1.0 for the third consecutive quarter (1.02). However, U.S. tariffs are expected to impact future results, with a 40 bps negative impact on gross margin in Q2. Capital expenditures for 2025 are planned at $300-$350 million, with at least 70% for capacity expansion. Free cash flow is expected to remain negative for the year due to elevated capex. The company expects to maintain its dividend and opportunistically repurchase shares, but does not plan additional share repurchases in 2025. The effective tax rate was 83.7% in Q2, impacted by low pre-tax earnings, and is expected to normalize higher than the U.S. statutory rate as earnings increase.
As of June 28, 2025, Vishay held $473.9 million in cash and cash equivalents, a decrease of $116.4 million from December 31, 2024. Short-term investments totaled $5.2 million. Total debt stood at $914.5 million, up from $905.0 million at year-end 2024, primarily due to a $49.0 million draw on the revolving credit facility to fund the $41.9 million cash settlement of the matured convertible senior notes due 2025. The convertible senior notes due 2030, with a principal amount of $750.0 million and a 2.25% coupon, remain outstanding. Shareholders' equity increased to $2,095.0 million from $2,029.0 million, driven by a $99.9 million other comprehensive income gain, largely from foreign currency translation ($99.5 million). Inventory rose to $754.9 million from $689.4 million, with increases across finished goods, work in process, and raw materials.
The Notes disclose undiscounted future operating lease payments totaling $165.8 million as of June 28, 2025, with $14.4 million due in the remainder of 2025, $25.4 million in 2026, and $71.2 million thereafter. The weighted-average remaining lease term is 8.8 years with a discount rate of 6.6%. A restructuring liability of $24.4 million remains from the September 2024 program, with $9.4 million classified as current. No material purchase commitments or supply obligations are disclosed in the Notes.
Under the Stockholder Return Policy, Vishay returned $39.7 million to stockholders in the first half of 2025, comprising $27.1 million in dividends ($0.10 per share quarterly) and $12.5 million in share repurchases (728,560 shares). Capital expenditures totaled $126.2 million, heavily weighted toward the MOSFETs segment ($92.3 million). The company repatriated $75.0 million of accumulated earnings to the U.S., paying $9.4 million in Israeli withholding taxes. Net debt increased modestly as the $49.0 million revolver draw to settle the 2025 notes was partially offset by other financing activities.
Segment reporting reveals a mixed performance landscape. Resistors ($194.8M revenue, 17.9% margin) and Inductors ($95.7M, 24.0% margin) delivered the strongest profitability. MOSFETs generated a segment operating loss of $14.5 million on $148.6 million in revenue, reflecting significant cost absorption challenges. Geographically, Asia represented the largest revenue region at $317.5 million (41.7% of total), followed by Europe at $256.5 million (33.7%) and the Americas at $188.3 million (24.7%). By channel, distributors accounted for $430.2 million (56.4%) of revenue. End-market exposure is led by Automotive ($267.4M) and Industrial ($267.0M).
Net earnings turned negative at $(2.1)M while CFO remained positive at $7.3M, supported by $109.7M depreciation and a $47.0M reduction in transition tax liability. Working-capital changes consumed $63.6M. Capex intensity stayed high at $126.2M, well above CFO and producing negative free cash flow. Capital returns (dividends $27.1M plus $12.5M repurchases) were funded by cash reserves and $49.0M net revolver draws. Cash fell $116.4M to $473.9M. No one-time investing items distorted the period beyond the prior-year acquisition outflow.