ON Semiconductor Corporation (ON)

Debt-to-equity ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Long-term debt	US$ in thousands	3,345,900	2,542,600	3,045,700	2,913,900	2,959,700
Total stockholders’ equity	US$ in thousands	8,796,400	7,782,600	6,188,500	4,585,400	3,538,500
Debt-to-equity ratio		0.38	0.33	0.49	0.64	0.84

December 31, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $3,345,900K ÷ $8,796,400K
= 0.38

The debt-to-equity ratio of ON Semiconductor Corporation has been steadily decreasing over the past five years. As of December 31, 2020, the ratio was 0.84, indicating that the company had more debt relative to its equity. However, by December 31, 2024, the ratio had decreased to 0.38, signaling a significant improvement in the company's financial leverage.

A decreasing trend in the debt-to-equity ratio is generally viewed positively by investors and creditors, as it suggests that the company is relying less on debt to finance its operations and is strengthening its financial position. A lower debt-to-equity ratio also indicates a reduced level of financial risk and greater financial stability.

Overall, the decreasing debt-to-equity ratio of ON Semiconductor Corporation over the five-year period reflects a prudent management strategy in terms of capital structure and financial risk management.