Vishay Intertechnology’s second quarter faced notable headwinds, leading to a negative market reaction following the earnings release. Management attributed the company’s results to persistent margin pressures, ongoing manufacturing inefficiencies in its MOSFET (metal-oxide-semiconductor field-effect transistor) segment, and the continued impact from the Newport wafer fab expansion. CEO Joel Smejkal highlighted that while revenue grew across all segments and regions, “manufacturing inefficiencies” and lower average selling prices offset volume gains, particularly in semiconductors. CFO Dave McConnell pointed to increased operating costs and the drag from the Newport facility as key contributors to the quarter’s underperformance.
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Vishay Intertechnology (VSH) Q2 CY2025 Highlights:
- Revenue: $762.3 million vs analyst estimates of $763.1 million (2.8% year-on-year growth, in line)
- Adjusted EPS: -$0.07 vs analyst estimates of $0.02 (significant miss)
- Adjusted EBITDA: $78.09 million vs analyst estimates of $60.92 million (10.2% margin, 28.2% beat)
- Revenue Guidance for Q3 CY2025 is $775 million at the midpoint, below analyst estimates of $782.1 million
- Operating Margin: 2.9%, down from 5.1% in the same quarter last year
- Inventory Days Outstanding: 112, in line with the previous quarter
- Market Capitalization: $2.00 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Vishay Intertechnology’s Q2 Earnings Call
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Ruplu Bhattacharya (Bank of America) asked about the Newport fab’s impact on margins and when normalization might occur. CFO Dave McConnell explained that transition costs would remain a headwind through the year, with improvement expected as production ramps in 2026.
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Bhattacharya (Bank of America) also questioned the sequential decline in MOSFET segment margins. McConnell attributed this to manufacturing inefficiencies in Q2, which he said have been addressed and should improve in Q3 as higher-margin IC sales grow.
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Bhattacharya (Bank of America) inquired about the impact of U.S. tariffs on profitability. CEO Joel Smejkal clarified that only a small percentage of products are manufactured in China for U.S. import, so the overall effect remains limited.
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Bhattacharya (Bank of America) explored the company’s appetite for M&A. Smejkal said Vishay remains open to both semiconductor and passive component acquisitions, citing a recent small acquisition to fill a portfolio gap.
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Kaykin Peng (JPMorgan) asked if the recent backlog build signals a stronger-than-seasonal second half. Smejkal stated that backlog growth is encouraging, but the company remains cautious given customer order patterns and typical seasonality.
Catalysts in Upcoming Quarters
Our team will be monitoring (1) progress on ramping up production and reducing margin drag at the Newport wafer fab, (2) further signs of demand stabilization or acceleration in automotive, smart grid, and AI infrastructure markets, and (3) the pace of inventory normalization and increased sell-through at distribution partners. Execution on new product qualifications and the ability to improve manufacturing efficiencies will also be critical milestones for Vishay in the coming quarters.
Vishay Intertechnology currently trades at $14.77, down from $16.01 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).
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