ON Semiconductor Corporation (ON)

Fixed asset turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	8,253,000	8,338,500	8,350,300	8,340,900	8,326,200	8,068,700	7,618,200	7,203,100	6,739,800	6,340,000	5,915,200	5,458,800	5,255,000	5,210,500	5,275,000	5,409,200	5,517,900	5,619,200	5,779,100	5,887,300
Property, plant and equipment	US$ in thousands	4,401,500	4,314,500	3,991,400	3,692,900	3,450,700	2,762,100	2,709,800	2,559,400	2,524,300	2,427,800	2,457,800	2,489,400	2,512,300	2,511,800	2,566,500	2,579,900	2,591,600	2,602,100	2,620,000	2,585,000
Fixed asset turnover		1.88	1.93	2.09	2.26	2.41	2.92	2.81	2.81	2.67	2.61	2.41	2.19	2.09	2.07	2.06	2.10	2.13	2.16	2.21	2.28

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $8,253,000K ÷ $4,401,500K
= 1.88

ON Semiconductor Corp.'s fixed asset turnover has exhibited fluctuations over the past eight quarters. The trend indicates a general decline from Q1 2022 to Q3 2022, reaching a low of 2.81. However, there was a slight improvement in Q4 2022 with a ratio of 2.41, after which the ratio decreased further in the subsequent quarters. This downward trend could suggest that the company may be experiencing challenges in generating revenue from its fixed assets efficiently.

The fixed asset turnover ratio measures how effectively a company generates revenue from its investments in fixed assets. A higher ratio indicates better utilization of fixed assets to generate sales. ON Semiconductor Corp.'s ratios ranging from 1.88 to 2.26 in the recent quarters signify that, on average, the company is generating sales turnover of around 1.88 to 2.26 for every dollar invested in fixed assets during the respective periods.

The declining trend in fixed asset turnover could raise concerns regarding the company's operational efficiency and asset utilization. It may suggest that the company is either experiencing challenges in effectively utilizing its fixed assets, facing pricing pressure, or struggling to maintain stable revenue growth relative to its investment in fixed assets.

Further analysis, in conjunction with other financial metrics and qualitative factors, may be necessary to gain a deeper understanding of the factors driving the changes in ON Semiconductor Corp.'s fixed asset turnover and to assess the overall financial health and operational performance of the company.