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    VSH
    Earnings call· Mar 2026(Q1 FY26)

    VISHAY INTERTECHNOLOGY Q1 FY26 earnings call VSH

    May 13, 2026 Source

    Executive summary

    Vishay Q1 FY26 — Strong Revenue Growth and Backlog Expansion Driven by Vishay 3.0 Strategy

    Vishay Intertechnology delivered a strong Q1 FY26, exceeding revenue guidance and demonstrating the effectiveness of its Vishay 3.0 growth strategy. The company saw broad-based revenue growth across all end markets and channels, driven by increased volume and market share gains, with a significant increase in book-to-bill and backlog. While capacity expansion efforts led to negative free cash flow, management reiterated confidence in its long-term revenue and margin targets, expecting 2026 to be a year of substantial growth as market conditions improve and investments yield returns.

    Highlights

    5

    • Revenue of $839 million exceeded guidance range of $800M-$830M, increasing 4.8% sequentially and 17.3% YoY.

    • Total company book-to-bill was 1.34, up from 1.2 in Q4 FY25, with backlog increasing 21% to $1.6 billion.

    • Gross margin expanded to 21.0%, exceeding guidance, with Newport fab reaching gross profit neutral.

    • Cash conversion cycle improved to 116 days from 125 days in Q4 FY25, driven by disciplined working capital management.

    • Industrial power revenue increased 6.5% sequentially, marking the fifth consecutive quarter of gains, with strong bookings in Americas and Europe.

    Concerns

    4

    • Free cash flow was negative $47 million due to high CapEx, reflecting capacity expansion plans.

    • GAAP effective tax rate remained elevated at 40-50% due to low pretax income.

    • Raw materials and WIP inventory increased due to rising metal prices and building buffer stock for geopolitical uncertainties.

    • SG&A expenses increased sequentially to $154 million from $142 million, primarily due to higher stock and bonus compensation.

    Guidance & targets

    11
    CategoryTargetConfidence
    Revenue
    $875M-$905M
    high materiality
    High
    Gross Margin
    22.0% +/- 50 bps
    high materiality
    High
    Depreciation Expense
    ~$54M
    medium materiality
    High
    Depreciation Expense
    $216M
    medium materiality
    High
    SG&A Expenses
    $155M +/- $3M
    medium materiality
    High
    GAAP Effective Tax Rate
    40-50%
    medium materiality
    Medium
    Free Cash Flow
    Negative
    high materiality
    High
    Capital Expenditure
    $400M-$440M
    high materiality
    High
    Revenue
    $5.5B
    high materiality
    High
    Gross Margin
    31%
    high materiality
    High
    Operating Margin
    20%
    high materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Automotive
    Mostly reflecting solid OEM demand in the Americas and Europe as customers continue to increase electronic content and start hybrid and EV programs. Asia revenue was weighed down a bit by Lunar New Year and Q4 pull-ins. Order intake increased due to Vishay 3.0 business approach to support new vehicle programs in Europe and China. Vishay is now the top supplier of resistors to multiple OEMs launching new EV platforms.
    		——2.7%—
    Industrial Power
    Fifth consecutive quarter of sequential gains. Demand continued to grow primarily for electrical power transmission and power management, renewable energy and smart metering, factory automation and security systems. Americas ramping up production for new projects supporting AI infrastructure. Europe and China continue to supply smart grid programs. Bookings were up sharply in the Americas and Europe. Won 2 new grid development projects in the U.K.
    		——6.5%—
    Aerospace Defense
    Strong demand from the U.S. government with spending approved to replenish munitions programs and with production ramping up in allied countries in Asia. U.S. defense contractors have just begun to increase orders for resistors, capacitors and custom magnetics. Long runway to drive growth as countries expand defense budgets and new multiyear programs start this year.
    		—16.8%14.1%—
    Healthcare
    Demand from long-standing customers, particularly in the Americas. Continuing to see success from efforts to leverage the breadth of the portfolio, cross-selling semis and passives. Design work remained around wearables, patient monitoring and implantables.
    		—11.1%4.5%—
    Other (Telecom, Computing, Consumer)
    Demand in China for AI-related applications was flat, reflecting the impact of the Lunar New Year and some shipments pulled into Q4. Continued to receive orders for quick delivery in Asia, mainly for high-voltage MOSFETs used in AI power applications. Customers adding passive technologies and AI power management solutions. Increasing activity from telecom customers in Americas supporting AI optical communication network switches (800 gigabits and 1.6 terabits). Europe telecom sales increased 33% with customers forecasting higher demand for 2026 versus 2025. Starting to receive requests for components for 6G networks.
    		—25.8%flat—

    Operational metrics

    42
    Revenue
    $839Mup 4.8% QoQ, up 17.3% YoY
    Q1 FY26

    Exceeded guidance range of $800M-$830M. Driven by 6% volume growth and 1% decline in ASPs QoQ. YoY growth driven by 14% volume increase and 4% favorable FX, partially offset by 1% ASP decline.

    Volume Growth
    5.8%QoQ
    Q1 FY26

    Drove revenue increase, with gains in both semis and passives.

    Average Selling Price Change
    -1%QoQ
    Q1 FY26

    Partially offset volume gains.

    Average Selling Price Change
    -1%YoY
    Q1 FY26

    Partially offset volume gains.

    Favorable Foreign Currency Impact
    4%YoY
    Q1 FY26

    Mainly from the euro, benefiting revenue.

    Gross Margin
    21.0%exceeding guidance and prior quarter
    Q1 FY26

    Higher volumes drove margin expansion, offsetting metals and material cost pressures. Newport fab was gross profit neutral exiting the quarter.

    Depreciation Expense
    $55Mrelatively flat vs Q4 FY25
    Q1 FY26
    SG&A Expenses
    $154Mvs $142M in Q4 FY25
    Q1 FY26

    Sequential increase primarily due to higher stock and bonus compensation expenses.

    GAAP Operating Margin
    2.6%vs 1.8% in Q4 FY25, vs 0.1% in Q1 FY25
    Q1 FY26
    EBITDA
    $78Mup from 8.8% in Q4 FY25
    Q1 FY26
    GAAP EPS
    $0.05vs $0.01 in Q4 FY25, vs -$0.03 in Q1 FY25
    Q1 FY26
    Cash Conversion Cycle
    116improved from 125 days in Q4 FY25
    Q1 FY26

    Due to continued disciplined working capital management.

    Days Sales Outstanding (DSO)
    41improved from 48 days in Q4 FY25
    Q1 FY26

    Due to further utilization of accounts receivable securitization program to fund 12-inch fab equipment purchases.

    Inventory Days Outstanding
    106improved
    Q1 FY26

    Due to increased volume and sales.

    Total Inventory
    $791Mincreased
    Q1 FY26
    Capital Expenditure
    $111M
    Q1 FY26

    Deployed for capacity expansion projects.

    Capital Intensity
    10.1%decrease from 11.3% in prior year
    TTM Q1 FY26
    Quarterly Dividend
    $13.6M
    Q1 FY26

    Part of stockholder returns.

    Share Repurchases
    $0
    Q1 FY26

    No shares repurchased during the quarter.

    Cash and investments balance
    $480M
    Q1 FY26

    Global cash and short-term investment balance at quarter end.

    Net Borrowing Position (U.S.)
    $250M
    Q1 FY26

    Outstanding on revolver.

    Accessible Revolving Credit Facilities
    $307M
    Q1 FY26

    Available at current EBITDA levels.

    Distribution Inventory
    20decreased from 22 weeks
    Q1 FY26

    Target was 26 weeks in Q1 2025. Supported strong demand, now customers replenishing.

    Point of Sale (POS) Growth
    10.7%QoQ
    Q1 FY26

    Growth in each region. Americas saw sharp increase in industrial, automotive, aerospace, defense, medical. Asia POS increased for industrial power and AI products.

    Point of Sale (POS) Growth
    24.9%YoY
    Q1 FY26

    Growth in each region. Americas saw sharp increase in industrial, automotive, aerospace, defense, medical. Asia POS increased for industrial power and AI products.

    OEM Revenue Growth
    7.1%QoQ
    Q1 FY26

    Strong shipments to large automotive, medical, aerospace, defense customers, and high demand from industrial OEMs in Europe. China OEM sales declined due to Lunar New Year and Q4 pull-ins.

    OEM Revenue Growth
    14.4%YoY
    Q1 FY26

    Strong shipments to large automotive, medical, aerospace, defense customers, and high demand from industrial OEMs in Europe. China OEM sales declined due to Lunar New Year and Q4 pull-ins.

    EMS Sales Growth
    14%QoQ
    Q1 FY26

    Demonstrates success of strategy to leverage expanded capacity and maintain competitive lead times. Fastest-growing channel in Europe.

    EMS Sales Growth
    21.6%YoY
    Q1 FY26

    Demonstrates success of strategy to leverage expanded capacity and maintain competitive lead times. Fastest-growing channel in Europe.

    Distribution Sales Growth
    2.2%QoQ
    Q1 FY26

    On volume gains in each region. Seeing higher consumption from industrial, transportation, aerospace defense customers and inventory replenishment.

    Distribution Sales Growth
    18.9%YoY
    Q1 FY26

    On volume gains in each region. Seeing higher consumption from industrial, transportation, aerospace defense customers and inventory replenishment.

    Revenue Growth
    15.3%QoQ
    Q1 FY26

    Led revenue growth for the quarter.

    Revenue Growth
    8.6%QoQ
    Q1 FY26

    Due to significant aerospace defense demand for capacitors and strengthening industrial demand.

    Revenue Change
    -4.9%QoQ
    Q1 FY26

    Primarily due to Lunar New Year impact, offset in part by strong AI product demand.

    AI-related Revenue
    well above $100Mvs under $100M in FY25
    FY26

    Expecting a nice step-up in growth in 2026 for semiconductors (MOSFETs, diodes) and passives (polymer tantalum, current sense resistors, magnetics).

    AI Market Growth
    high double-digit (20%)
    FY26

    Expected growth for the AI market segment.

    Automotive Market Growth
    mid-single digits
    FY26

    Expected growth for the automotive market segment, driven by content increase.

    Industrial Market Growth
    above 10%
    FY26

    Expected growth for the industrial market segment with current product mix.

    Aerospace Defense Market Growth
    high-growth
    FY26

    Expected growth for the aerospace defense market segment, with orders just beginning to come in.

    Healthcare Market Growth
    mid-single digit
    FY26

    Expected growth for the healthcare market segment.

    Overall Industry Growth
    high single digit
    FY26

    Overall expected industry growth, with Vishay aiming to outgrow the market.

    Average Selling Price Improvement
    1.5%QoQ
    Q2 FY26

    Expected due to pricing increases announced in Q4 FY25 and Q1 FY26, with further effects in Q3 FY26.

    Industry KPIs

    8
    MetricValueDetails
    Orders book to bill1.34
    Segment revenue growth—
    Content per device per vehicle—
    Design wins product cycle ramps—
    Order visibility backlog policy5.7months
    Supply demand imbalance lead times—
    Capacity expansion internal sourcing—
    End market revenue mix organic growth—

    Orderbook & backlog

    6
    Total Company Book-to-Bill1.34Q1 FY26 end

    up from 1.2 in Q4 FY25

    Order growth momentum was broad-based across regions, channels, technologies, and end markets.

    Semiconductors Book-to-Bill1.47Q1 FY26 end
    Passives Book-to-Bill1.23Q1 FY26 end
    Total Backlog$1.6BQ1 FY26 end

    increased 21%

    Represents 5.7 months of revenue. Customers proactively placing orders based on longer visibility (1-year forecasts) and building safety stock (Asia for AI, all regions for automotive/industrial).

    EMS Americas Book-to-Bill1.45Q1 FY26 end

    grew

    Aerospace Defense Americas Book-to-Bill1.4Q1 FY26 end

    continued to build in Q2

    Orders for defense are in very early innings.

    Product announcements

    3
    ProductTypeDetails
    750-volt Gen 2 planner MOSFETslaunch
    1,700-volt platformsroadmap
    1,200-volt trench MOSFETupdate

    Deals & partnerships

    1
    SK KeyfoundryCollaboration to add capacity for AI-related applications.

    Working towards releasing 2 products to production in Q3 FY26.

    Capital programs

    2
    12-inch Fab in Germanyunderway
    Period spend: $87M

    Nearly all of the 12-inch fab investment will be spent during the first half of 2026, reaching capital intensity peak. Equipment installation started in Q1, planned to finish in Q2.

    Newport 8-inch Wafer Fab for Silicon Carbideunderway
    Start: Q1 FY26

    Setting up Newport to be an 8-inch wafer fab for silicon carbide, following the release of 1,200-volt trench MOSFETs.

    Risks & headwinds

    5
    Elevated GAAP Effective Tax RateQ2 FY26

    40-50% for Q2 FY26

    Mitigation: Expected to become more predictable and in line with historical average as earnings grow.

    Ongoing Metals and Material Cost PressuresQ1 FY26, continuing into Q2 FY26

    Offsetting higher volumes, impacting gross margin.

    Mitigation: Partially offset by ASP increases; built into Q2 gross margin guidance.

    Inefficiencies due to ramping up of new direct labor headsQ2 FY26

    Included in Q2 gross margin guidance.

    Geopolitical UncertaintiesQ1 FY26

    Impacted raw materials and WIP inventory.

    Mitigation: Built buffer stock in raw materials and WIP inventory to ensure supply to customers.

    Impact of inventory digestion and tariffs on long-term targetsPast (Q1 FY25) and ongoing impact

    Delayed timing of 5-year plan revenue and margin targets.

    Mitigation: Vishay 3.0 strategy and capacity expansion are positioning the company for accelerated growth in 2026.

    What to watch in Q2 FY26

    5

    12-inch Fab Equipment Installation

    Q2 FY26
    CurrentStarted in Q1 FY26
    TargetFinished in Q2 FY26

    Why it matters

    Completion of equipment installation is a key milestone for the 12-inch fab, which is central to Vishay's capacity expansion and future growth, particularly for non-automotive production starting mid-2027.

    At our 12-inch fab in Germany, we've started to install equipment during the quarter and plan to finish in the second quarter.

    Q&A highlights

    5

    Did Vishay gain share against Nexperia in automotive, and how much did it benefit revenue? Was Newport fab still a negative to gross margins in Q1, and is it expected to be negative in Q2?

    Joel confirmed share gains in automotive, driven by multi-sourcing efforts and site approvals for Newport. Dave stated Newport was gross profit neutral exiting Q1, but had costs in Jan/Feb. They will stop giving specific Newport impact guidance as its costs are co-mingled. Automotive qualifications are needed to fill the fab.

    “Regarding the share gain, yes, we're gaining share. We've been working very closely on automotive as well as OEMs to make sure there's multi-sources on programs where there may have been previously.”

    asked by Ruplu Bhattacharya · answered by Joel Smejkal

    2 min read5 chapters

    Detailed Narrative

    01

    Vishay 3.0 Strategy Execution

    The company's Vishay 3.0 transformation and growth strategy, initiated three years prior, is yielding results. This includes heavy CapEx investment in high-growth, high-margin product lines, adding subcontractors for manufacturing flexibility, expanding product portfolios, and increasing FAE involvement for design support and solutions. The strategy aims to position Vishay as a reliable supplier with expanded capacity, ready to scale with customers and drive market share gains.

    02

    Market Share Gains and Customer Engagement

    Vishay is actively gaining market share, particularly in the automotive sector, by becoming a reliable supplier with expanded capacity. The company is collaborating with OEMs and Tier 1s on technology roadmaps and demand planning, leading to increased orders from previously inactive or underserved customers. Efforts include supporting new vehicle programs in Europe and China, and becoming a top resistor supplier for new EV platforms.

    03

    AI-Related Demand and Product Focus

    Demand for AI-related applications remains strong, with Vishay positioning itself to increase participation. The company is supplying high-voltage MOSFETs, polymer capacitors, power inductors, and current sense resistors for AI power management solutions. Vishay is also working on next-generation designs for server power, optical communication modules, and high-bandwidth network switches, actively seeking to get its technologies on bills of materials for new programs.

    04

    Capacity Expansion and Fab Progress

    Vishay is holding to its CapEx plan of $400M-$440M for 2026, with about half allocated to the 12-inch fab in Germany, where equipment installation is underway for mid-2027 non-automotive production. The Newport facility continues to ramp wafer production, with 4 Tier 1 automotive customer audits completed and 2 more planned for Q2, aiming for further share gains and approvals.

    05

    Silicon Carbide Strategy

    The company released 750-volt Gen 2 planner MOSFETs for automotive and industrial platforms and plans to release 1,700-volt platforms over the next couple of quarters. Following the release of 1,200-volt trench MOSFETs using an external fab, Newport is now being set up as an 8-inch wafer fab for silicon carbide, indicating a strategic shift towards in-house production for this technology.

    AI-generated summary of the company’s earnings call. Not investment advice.