Vishay Intertechnology 2025 Q2 Earnings Significant Net Income Decline Despite Revenue Growth

Vishay Intertechnology reported a revenue increase but a substantial drop in earnings, missing expectations due to the steep decline in net income. The company reaffirmed growth momentum for Q3 2025 and maintained gross margin guidance.

Revenue
Vishay Intertechnology’s total revenue for fiscal 2025 Q2 rose 2.8% to $762.25 million, compared to $741.24 million in 2024 Q2. This growth was supported by strong performance across all segments, with semiconductors and passive components driving expansion. MOSFETs contributed $148.63 million, while Diodes accounted for $147.94 million. Resistors, the largest revenue contributor, brought in $194.77 million. Inductors and Capacitors added $95.67 million and $121.11 million, respectively, and Optoelectronic Components generated $54.12 million in revenue.

Earnings/Net Income
Vishay’s net income fell sharply to $2 million in Q2 2025, a 91.6% decline from $23.88 million in the same period of 2024. Earnings per share (EPS) dropped 94.1% to $0.01 from $0.17 in 2024 Q2, reflecting the negative impact from the addition of Newport and operating inefficiencies. This represents a poor earnings performance, with both EPS and net income far below prior-year levels.

Price Action
Following the earnings report, VSH’s stock price declined 12.38% on the latest trading day, 18.48% for the week, and 17.31% for the month, indicating heightened market skepticism about the company’s outlook and performance.

Post-Earnings Price Action Review
Historically, the buy-and-hold strategy for Vishay Intertechnology based on its quarterly revenue raise has performed poorly, with the 30-day returns showing a consistent -11.28% decline across the last three quarters. This trend suggests a lack of investor confidence and a failure of the strategy to yield positive returns. The ongoing stock price decline aligns with this negative performance, underscoring that this investment approach may not be suitable for investors seeking growth.

CEO Commentary
Joel Smejkal, president and CEO, highlighted a 7% sequential revenue increase for Q2 2025, noting growth across semiconductors and passive components. He emphasized Vishay’s strategic investments in capacity expansion and expressed optimism about participating in the broader market upturn. The CEO remains confident in the company’s readiness to benefit from the recovery in end markets.

Guidance
For Q3 2025, Vishay expects revenue between $775 million ± $20 million. The company also projected a gross profit margin of 19.7% ± 50 basis points, factoring in a negative impact of approximately 160 to 185 basis points from Newport. Vishay plans to host a conference call on August 6, 2025, to provide a detailed review of the financial results and outlook.

Additional News
The latest quarterly report underscores Vishay’s integration of Newport, which has had a measurable but negative impact on gross margins. Management highlighted a $11.293 million benefit from the favorable resolution of a contingency in SG&A expenses for Q2 2025, which partially offset operating challenges. The company also reported a 4.6-month backlog at quarter-end, suggesting strong demand and order inflow. Notably, Vishay has maintained its quarterly dividend at $0.10 per share, a consistent approach amid a challenging earnings environment. Capital expenditures for the first half of the year reached $126.167 million, reflecting ongoing investment in production capacity and operational expansion.