Earnings Per Share and Equity

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

Earnings Per Share and Equity

Note 10: Earnings Per Share and Equity

Earnings Per Share

Net income per share of common stock attributable to ON Semiconductor Corporation is shown below (in millions, except per share data):

	Year ended December 31,
	2023		2022		2021
Net income for basic earnings per share of common stock	$	2,183.7	$	1,902.2	$	1,009.6
Add: Interest on 1.625% Notes	1.3		2.0		—
Net income for diluted earnings per share of common stock	$	2,185.0	$	1,904.2	$	1,009.6
Basic weighted-average shares of common stock outstanding	430.7		433.2		425.7
Dilutive effect of share-based awards	1.2		1.8		2.5
Dilutive effect of convertible notes and warrants	14.9		13.2		15.6
Diluted weighted average shares of common stock outstanding	446.8		448.2		443.8
Net income per share of common stock:
Basic	$	5.07	$	4.39	$	2.37
Diluted	$	4.89	$	4.25	$	2.27

Basic income per share of common stock is computed by dividing net income attributable to the Company by the weighted average number of shares of common stock outstanding during the period. To calculate the diluted weighted-average shares of common stock outstanding, treasury stock method has been applied to calculate the number of incremental shares from the assumed issuance of shares relating to RSUs. The excluded number of anti-dilutive share-based awards was approximately 0.1 million, 0.3 million and 0.3 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The dilutive impact related to the Company’s 0.50% Notes, 0% Notes and 1.625% Notes has been calculated using the if-converted method for the years ended December 31, 2023 and 2022 and using the treasury stock method for the year ended 2021. While the 0.50% Notes and the 0% Notes are repayable in cash up to the par value and in cash or shares of common stock for their entire value, the 1.625% Notes were repayable in cash or shares of common stock for their entire value.

Prior to conversion, the convertible note hedges are not considered for purposes of the earnings per share calculations, as their effect would be anti-dilutive. Upon conversion, the convertible note hedges are expected to offset the dilutive effect of the 0.50% Notes, 0% Notes and 1.625% Notes when the stock price is above $103.87, $52.97 and $20.72 per share, respectively. The dilutive impact of the warrants issued concurrently with the issuance of the 0.50% Notes, 0% Notes and 1.625% Notes with exercise prices of $156.78, $74.34 and $30.70, respectively, has been included in the calculation of diluted weighted-average common shares outstanding, if applicable.

Equity

Share Repurchase Program

In February 2023, the Board of Directors approved a new share repurchase program (the “2023 Share Repurchase Program”) under which the Company may repurchase up to an aggregate of $3.0 billion of the Company's common stock (exclusive of fees, commissions and other expenses). Under the 2023 Share Repurchase Program, which does not require the Company to purchase any minimum amount of common stock or at all, the Company may repurchase shares from February 8, 2023 through December 31, 2025. The repurchases under the 2023 Share Repurchase Program amounted to $564.0 million during the year ended December 31, 2023.

Under the Company's previous share repurchase program announced on November 15, 2018, the Company could repurchase up to $1.5 billion (exclusive of fees, commissions and other expenses) of the Company's common stock from December 1, 2018 through December 31, 2022. The repurchases under the previous share repurchase program amounted to $259.8 million during the year ended December 31, 2022. There were no repurchases during the year ended December 31, 2021. The previous share repurchase program, which did not require the Company to purchase any particular amount of common stock and was subject to

the discretion of the Board of Directors, expired on December 31, 2022, with approximately $1,036.0 million remaining unutilized.

Activity under both the 2023 Share Repurchase Program and the previous program is as follows (in millions, except per share data):

	Year ended December 31,
	2023		2022		2021
Number of repurchased shares (1)	7.6		4.0		—
Aggregate purchase price	$	564.0	$	259.8	$	—
Fees, commissions and excise tax	4.1		—		—
Total	$	568.1	$	259.8	$	—
Weighted-average purchase price per share (2)	$	74.54	$	65.13	$	—
Available amounts	$	2,436.0	$	1,036.0	$	1,295.8

_______________________

(1)None of these shares had been reissued or retired as of December 31, 2023 but may be reissued or retired later.

(2)    Exclusive of fees, commission or other expenses.

Shares for Restricted Stock Units Tax Withholding

The amounts remitted for tax withholding during the years ended December 31, 2023, 2022 and 2021 were $67.1 million, $78.1 million and $38.9 million, respectively, for which the Company withheld approximately 0.8 million, 1.3 million and 0.9 million shares of common stock, respectively, that were underlying the RSUs that vested. This activity in connection with tax withholding upon vesting was not made under the 2023 Share Repurchase Program or the previous share repurchase program.

Non-Controlling Interest

Leshan operates assembly and test operations in Leshan, China. The Company owns 80% of the outstanding equity interests in Leshan, and the results of Leshan have been consolidated in the Company's financial statements. As of December 31, 2023, the Leshan non-controlling interest balance was $18.0 million. This balance included the Leshan non-controlling interest's $1.9 million share of the earnings for the year ended December 31, 2023 offset by $2.4 million of dividends paid to the non-controlling shareholder. As of December 31, 2022, the Leshan non-controlling interest balance was $18.5 million. This balance included the Leshan non-controlling interest's $1.6 million share of the earnings for the year ended December 31, 2022 offset by $2.1 million of dividends declared to the non-controlling shareholder.