Vishay Intertechnology (VSH) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenues reached $762.3 million, up 7% sequentially, with growth across all end markets, channels, and regions; book-to-bill was 1.02 and backlog at 4.6 months.

• Gross margin was 19.5%, negatively impacted by 160 basis points due to Newport; net earnings were $2.0 million (EPS $0.01), with adjusted loss per share of $(0.07) after an $11.3 million contingency benefit.

• Free cash flow was negative at $(73.2) million for Q2, reflecting higher capital expenditures and lower operating cash flow.

• Capacity expansion investments of $775 million over 2.5 years are underway, positioning for a market upturn.

• Strategic initiatives focus on customer engagement, innovation, and expanding the product portfolio, especially in power applications and silicon carbide.

Financial highlights

• Q2 2025 revenue: $762.3 million, up 7% sequentially and 2.8% year-over-year; gross profit: $148.7 million; gross margin: 19.5%.

• GAAP operating margin: 2.9%; adjusted operating margin: 1.4%; adjusted EBITDA: $63.5 million (8.3% margin).

• GAAP EPS: $0.01; adjusted loss per share: $(0.07); adjusted net earnings per diluted share down from $0.17 in Q2 2024.

• Free cash flow: $(73.2) million in Q2; $(118.4) million for the first half of 2025.

• Cash and cash equivalents at quarter end: $473.9 million; total debt: $914.5 million.

Outlook and guidance

• Q3 2025 revenue expected at $775 million ± $20 million, with gross margin guidance of 19.7% ± 50 bps; Newport expected to drag margins by 160–185 bps.

• SG&A for Q3: $138 million ± $2 million; full-year SG&A: $540–$560 million (excluding one-time benefit); normalized effective tax rate projected at 30–32%.

• 2025 capital expenditures projected at $300–$350 million, with at least 70% for capacity expansion.

• Free cash flow expected to remain negative for 2025 due to ongoing expansion, but anticipated to improve post-expansion.

• Dividend to be maintained; opportunistic share repurchases based on U.S. liquidity and Stockholder Return Policy.