ON Semiconductor Corporation
Exchange: NASDAQ
Ticker: ON
Date of Filing: 12/12/2023
Court:
Filing Deadline

02/12/2024

TWERSKY LAW GROUP Notifies ON Semiconductor Corporation (ON) Investors of Class Action

ON  – Twersky Law Group, a highly regarded and reputable law firm based in New York, wishes to inform investors about a significant development in the form of a class action lawsuit against ON Semiconductor Corporation (“ON” or “the Company”) (NASDAQ: ON) and certain officers of the company. This lawsuit has been filed on behalf of all individuals and entities that purchased or otherwise acquired ON securities from May 1, 2023 through October 27, 2023.  (the “Class Period”). Investors who acquired ON securities during this defined timeframe are strongly encouraged to participate in this case by contacting atara@twerskylawgroup.com. The deadline to file a motion for appointment of lead plaintiff is February 12, 2024.

The fundamental objective of this class action lawsuit is to recover for the benefit of investors who purchased ON securities during the Class Period, the losses they sustained as a consequence of the misleading statements made by Defendants in violation of the federal securities laws.

 

ALLEGATIONS AGAINST ON

Critical to onsemi’s long-term growth and success is its strategy to focus on the development, manufacture, and sale of a variety of products incorporating silicon carbide (“SiC”). A substantial portion of onsemi’s SiC products are necessary components of a number of systems used in the production of electric vehicles (“EVs”). Throughout the Class Period, Defendants made repeated misrepresentations to investors regarding the “stability” and “visibility” of the demand for onsemi’s SiC and other products, and the sustainability of onsemi’s revenue growth, by overstating the impact of onsemi’s long-term supply agreements (LTSAs”) on the achievability of its revenue streams. On May 1, 2023, the first day of the Class Period, onsemi released its first quarter 2023 earnings and accompanying investor earnings call with equity analysts. During that call, Defendants spoke extensively on the growth of onsemi’s SiC business and touted the fact that the company has “more and more confidence” in its claim that it would reach $1 billion in annual revenue for its SiC products in 2023. Specifically, Defendants explained that onsemi’s outlook was “actually very, very predictable,” which was “the benefit that we’ve been talking about with the LTSAs that have us really, with our customers, align on pricing and volume through the duration of the LTSAs.” Thereafter and throughout the Class Period, Defendants continued to tout onsemi’s sales of SiC products, particularly to EV manufacturers. Defendants lauded onsemi’s LTSAs for the “extended visibility” and the “very, very clear view of where demand is,” aiding Defendants in their ability to effectively manage changing macroeconomic conditions and sustain onsemi’s revenue growth targets. Indeed, Defendants consistently disclosed increasing expected revenue figures for every new LTSA onsemi had signed with customers and assured investors that the LTSAs built “a more strategic relationship and partnership” with onsemi’s customers. Thus, Defendants told investors that, if onsemi’s customers “have . . . softness in their market and they have an LTSA, we’re going to get the call 6 months in advance.” Notwithstanding Defendants’ assurances, on October 30, 2023, before the market opened, investors began to learn the truth about the purported benefits of onsemi’s LTSA strategy and the achievability of projected revenue from the company’s products subject to LTSAs, when onsemi announced its third quarter 2023 financial results. During the investor earnings call held that day, Defendants disclosed to investors that onsemi was “taking a very cautious approach” with its SiC products due to signs of a weakening demand in the company’s automotive business segment (which generates between 75% and 90% of onsemi’s SiC revenues), while also revealing that onsemi would miss its $1 billion 2023 SiC revenue target by approximately $200 million. Defendants claimed that the approximately 20% reduction in onsemi’s expected SiC revenue was solely attributable to one customer (identified by many analysts as Tesla, Inc.). Defendants added, however, that onsemi expects “greater sequential declines in industrial and other end markets” as well. On this news, the price of onsemi common stock plummeted $18.18 per share, or nearly 22%, from a close of $83.52 per share on October 27, 2023, to close at $65.34 per share on October 30, 2023. The Complaint alleges that, throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business and operations. Specifically, Defendants misrepresented and/or failed to disclose that: (1) revenues from billions of dollars in reported LTSAs were “committed” and “locked in,” and were effectively certain to be obtained by onsemi when, in fact, onsemi could and would abrogate the LTSAs at a customer’s request; (2) LTSA’s provided “predictable” and “sustainable” performance to drive onsemi’s growth, even in tough macroeconomic conditions, when, in fact, they would be modified or eliminated as conditions changed; and (3) Defendants had “good visibility” into customer demand when, in fact, demand could be reduced on short notice, even where LTSAs were in effect. As a result of the foregoing, Defendants’ positive statements about onsemi’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis.

 

ABOUT ON

  • ON Semiconductor is a semiconductor supplier that designs and manufactures a wide range of semiconductor components for various applications, including automotive, industrial, communication, and consumer electronics. 

 

JOIN THIS CASE

It is important to note that a class action lawsuit has already been filed in connection with these allegations. Therefore, for those individuals who suffered financial losses in their investments in ON during the Class Period, there is a limited opportunity to seek appointment as a lead plaintiff. This process entails requesting the Court to designate them as the primary representative on behalf of the entire class. The deadline for submitting such a request is February 12, 2024. It is important to emphasize that while becoming a lead plaintiff can offer certain advantages, participation in the recovery process and the potential for financial compensation does not mandate serving as a lead plaintiff.

Twersky Law Group, a distinguished legal firm renowned for its attorneys expertise in handling securities fraud class actions and shareholder derivative suits, who have a long-standing track record of successfully recovering significant sums of money for investors nationwide. With an unwavering commitment to seeking justice for their clients, the firm’s attorneys are resolute in pursuing fair compensation on behalf of those affected by alleged securities law violations. As with any legal matter, it is essential to understand that this announcement constitutes attorney advertising. Past case outcomes and results achieved do not guarantee similar outcomes in this particular case.



DOCUMENTS


COMPLAINT

PLEASE READ THE COMPLAINT  DOCUMENT BEFORE SIGNING UP FOR THIS CASE.

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