On May 5, 2025, Onsemi announced a promising second-quarter revenue forecast, surpassing Wall Street expectations, driven by robust demand for its silicon carbide chips in electric vehicles (EVs). Despite economic uncertainties and looming U.S. tariffs, the chipmaker’s outlook signals a resilient EV market, offering insights for EV owners and enthusiasts following industry trends, according to Reuters.

Silicon Carbide Chips Fuel EV Growth

Onsemi, a key supplier of silicon carbide chips, projects its Q2 revenue to range between $1.40 billion and $1.50 billion, exceeding analysts’ estimates of $1.42 billion, according to LSEG data. These chips are critical for extending EV range, a priority for automakers as EV sales grow. In the first quarter, Onsemi saw orders surge due to EV sales growth in China en Europa, despite a looming 25% U.S. tariff on auto imports. The company reported first-quarter revenue of $1.46 billion, beating estimates of $1.40 billion, though it marked a 22% drop from the previous year due to broader market challenges.

Silicon carbide chips are prized in EVs for their efficiency in power management, enabling longer driving ranges—sometimes adding 50–100 miles per charge compared to traditional silicon chips. However, U.S. President Donald Trump’s tariffs, effective from April 3, 2025, could disrupt supply chains, potentially increasing car prices by thousands of dollars. This has prompted automakers to adjust forecasts, with some pulling back on EV production timelines.

Industry Challenges and Strategic Moves

The EV sector faces headwinds from Trump’s duties, which may exacerbate supply chain issues. Onsemi’s chips, vital for EV performance, could see higher demand as manufacturers rush to secure components before prices spike. Meanwhile, Onsemi’s recent decision to scrap its $6.9 billion takeover of Allegro MicroSystems (ALGM.Q) last month—citing Allegro’s board’s reluctance—shows the company’s cautious approach to expansion amid market volatility. Additionally, Onsemi plans to lay off about 2,400 employees worldwide in 2025 to streamline operations, a move that could impact its production capacity.

Onsemi’s adjusted earnings per share for Q2 are expected to fall between 48 cents and 58 cents, compared to estimates of 52 cents. This range reflects cautious optimism as the company navigates tariff-related uncertainties and global demand fluctuations.

EVXL’s Take

For EV owners and enthusiasts, Onsemi’s forecast is a bright spot in a stormy market. These silicon carbide chips are the unsung heroes behind your EV’s range—think of them as the caffeine boost that keeps your car going farther on a single charge. While Trump’s tariffs might bump up EV prices (potentially by $2,000–$5,000 per vehicle), the tech advancements Onsemi is driving could maken your next EV more efficient than ever. It’s like upgrading from a flip phone to a smartphone—same road trip, but with a lot more juice. We’ll be watching how automakers adapt to these tariffs and whether Onsemi’s chips can keep pushing the EV revolution forward. For now, EV fans can take heart: the tech under the hood is still charging ahead, even if the road’s a bit bumpy.

Photo courtesy of Onsemi