VSH

Vishay Intertechnology’s second quarter was met with a significant negative market reaction, as revenue missed Wall Street’s expectations despite double-digit year-over-year growth. However, management did not attribute the shortfall to ongoing supply chain constraints or rising input costs. Instead, management emphasized robust demand, successful execution, and operational agility across industrial, automotive, and AI-related end markets. CEO Joel Smejkal highlighted that the company’s “hybrid model of semis and passives” is positioning Vishay for share gains, particularly as customers seek to secure supply amid lengthening lead times and escalating concerns over component availability. Is now the time to buy VSH? Find out in our full research report (it’s free). Revenue: $888.6 million vs analyst estimates of $904.9 million (16.6% year-on-year growth, 1.8% miss) Adjusted EPS: $0.19 vs analyst estimates of $0.14 (34.2% beat) Adjusted EBITDA: $109.6 million vs analyst estimates of $99.74 million (12.3% margin, 9.9% beat) Revenue Guidance for Q3 CY2026 is $960 million at the midpoint, above analyst estimates of $941.6 million Operating Margin: 6%, up from 2.9% in the same quarter last year Inventory Days Outstanding: 108, in line with the previous quarter Market Capitalization: $5.11 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Ruplu Bhattacharya (Bank of America Merrill Lynch) asked about utilization rates at the company’s fabs and expectations for new capacity from the Newport and Germany sites. CEO Joel Smejkal responded that foundry capacity in Korea and China will support AI demand, with automotive approvals at Newport progressing and the German fab on track for mid-2027 commercial output. Bhattacharya (BofA) also questioned Vishay’s exposure to MLCC versus polymer tantalum capacitors for AI and automotive. Smejkal explained that polymer tantalum remains a core focus, with capacity expanding in Mexico, while MLCCs are mainly used in military and medical applications. Bhattacharya (BofA) inquired about capital allocation between CapEx and buybacks. CFO David McConnell confirmed $400–440 million CapEx for 2026, with capital intensity expected to decline as revenue scales, and noted buybacks are not a near-term focus given growth priorities. David Williams (Needham) focused on gross margin expansion and the timeline for reaching Vishay’s long-term margin targets. Smejkal outlined several initiatives, including channel management and factory optimization, and reiterated the goal of reaching 30% gross margin by 2028. Melissa Dailey Fairbanks (Raymond James) asked about potential order pull-forwards ahead of price increases. Smejkal commented that backlog updates keep customers from avoiding higher prices, and inventory build-ups remain constrained by strong demand across end markets. In the quarters ahead, the StockStory team will be monitoring (1) the ramp-up and production milestones at Vishay’s new 12-inch wafer fab in Germany, (2) sustained demand for AI, industrial, and automotive components as new capacity comes online, and (3) the company’s ability to maintain margin expansion through product mix optimization and channel management. Additional focus will be placed on the execution of R&D initiatives and any developments in supply chain stability. Vishay Intertechnology currently trades at $33.61, down from $38.85 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 9:00 a.m. ET Executive Vice President, Corporate Development - Peter Henrici President and Chief Executive Officer - Joel Smejkal Executive Vice President and Chief Financial Officer - David McConnell Peter Henrici: Good morning, and welcome to Vishay Intertechnology's Second Quarter 2026 Earnings Conference Call. I am joined today by Joel Smejkal, our President and Chief Executive Officer, and by Dave McConnell, our Chief Financial Officer. This morning, we reported results for our second quarter 2026. A copy of our earnings release is available in the Investor Relations section of our website at ir.vishay.com. This call is being broadcast live over the web and can be accessed through our website. In addition, today's call is being recorded and will be available via replay on our website. During the call, we will refer to a slide presentation, which we also posted on ir.vishay.com. You should be aware that during today's conference call, we will be making certain forward-looking statements that discuss future events and performance. These statements are subject to risks and uncertainties that could cause actual results to differ from the forward-looking statements. For a discussion of factors that could cause results to differ, please see today's press release and Vishay's Form 10-K and Form 10-Q filings with the Securities and Exchange Commission. We are including information in our press release and on this conference call on various GAAP and non-GAAP measures. We have included a full GAAP to non-GAAP reconciliation in our press release and in the presentation posted on ir.vishay.com, which we believe will be useful when comparing our GAAP and non-GAAP results. We use non-GAAP measures because we believe they provide useful information about the operating performance of our businesses and should be considered by investors in conjunction with GAAP measures. Specifically, as it pertains to our tariff refunds, we are reporting GAAP and adjusted revenue for the second quarter. The second quarter 2026 adjusted net revenues exclude $30.0 million for tariff refunds passed through to customers with no impact on gross profit. The tariff refunds are recognized as reductions of net revenues and cost of products sold in the second quarter 2026 GAAP results. Adjusted gross margin is calculated using adjusted net revenues. Tariff refunds have not been allocated to a reportable segment, end market, sales channel or region. All following second quarter 2026 measures presented, exclude tariff refunds. Tariff refunds do not impact any other period presented. On today's conference call, management will refer to adjusted revenues in the analysis of results for the quarter. Now I turn the call over to President and Chief Executiver, Joel Smejkal. Joel Smejkal: Thank you, Peter. Thank you, everyone, for joining our call this morning. Let's start the call with a review of the second quarter performance, and Dave will take you through a detailed review of our financial results for the quarter and our guidance for the third quarter of 2026. After that, I'll update you on the strategic levers we are pulling to drive growth and profitability, and then we'd be happy to answer any of your questions. For the second quarter, we are reporting adjusted revenue of $919 million, exceeding the top end of our revenue guidance. Revenues are growing faster over the past 5 quarters on strengthening demand, supported by the agility of Vishay 3.0. Compared to the first quarter, revenue grew 9.5%, 20.5% year-on-year, reflecting continued growth across all Vishay product technologies, our end markets, business channels and regions. Market share gains for both semis and passives came through higher consumption from increasing customer volume and increasing customer count with increasing demand in the industrial segment, AI, aerospace and automotive. In terms of demand dynamics, our Q2 results are a continuation of Q1. And on a year-to-year basis, our results tell us that Vishay 3.0 is working as designed. With industry lead time stretching, pricing rising and geopolitical tensions remaining, customers are concerned about the availability of products and assurance of supply. To secure supply, customers are placing orders showing longer visibility. Many customers are forecasting 6 months out with a desire to replenish their own inventories. Demand related to AI applications continues to accelerate, leading numerous customers to place orders beyond 52 weeks to make sure they have a place in our production loading. Book-to-bill for Q2 was 1.32 with semis at 1.23 and passives higher at 1.40. Q2 is a record high bookings for resistors and inductors. As a result, our total backlog grew 18% to $1.9 billion or 6.1 months. Having invested $900 million to expand capacity during the recent market trough years, we are reacting much faster than historically to serve more customers. We are demonstrating that we can scale with their volume production while maintaining competitive lead times. Our book-to-bill is showing us that we are getting turns orders because of the first half '26 improved delivery performance. In the fourth quarter of '25, we began to announce price increases related to increasing cost of metals, materials and logistics. Price increase announcements continued through Q1 and Q2 this year. At this point, about 1/3 of our running part numbers have announced price increases. We saw some of the price increases land in our Q2 financials. The attractiveness of our hybrid component business model grows. Our volume manufacturer of both discrete semis and passives helps customers as they search for greater supply of all of these components on their bill of materials. As a reminder, Vishay can populate more than 80% of the components on a board in a power application. Another point to share, customers are more frequently raising their requests for Western supply of electronic components, which fits very well with our geographical manufacturing footprint and further site optimization projects. Vishay is a technically leading Western located manufacturer. And now with our Vishay 3.0 mindset and customer-serving approach, we can supply them with the product they need. Let's turn to a review of Q2 revenue, starting with the revenue by end market on Slide 4. All end markets show positive revenue increase with industrial accounting for more than half of the increase. Industrial revenue increased 16.2% versus Q1 and 30.1% versus prior year, reflecting higher consumption primarily for smart grid, AI power and high-voltage DC projects as well as factory automation. Bookings increased due to our ability to serve a growing POS through our distribution channel. New programs are launching in the second half of '26 and into '27 with positive demand trends in industrial power for AI, especially as EMS customers accelerate investments in AI-related applications to support data center growth and high-voltage DC transmission. We continued design discussions with customers for humanoids. To elaborate further on industrial, our bookings increased for industrial power applications for customers who are participating in power conversion and tooling projects for AI data centers. We are increasing our part count on new projects as customers add our passives to AI power management solutions. Also customers who are not AI-related, that demand is becoming increasingly concerning. These customers need to make sure they have a manufacturing spot in our queue, escalations are increasing. In automotive, revenue increased 3.6% quarter-over-quarter and 10.1% versus prior year, reflecting ongoing demand as electronic content continues to increase for driver assist and autonomous driving applications, plus the further adoption of hybrid and EV platforms. Bookings were strong in the Americas as customers are becoming more proactive to share their visibility and backlog placement. In some cases, customers are providing us with forecast for the next 12 to 18 months. In Asia, we are seeing distributors and OEMs wanting to build safety stocks, but this is challenging in this high-demand market. Aerospace defense revenue increased 4.2% versus the first quarter and 15.4% versus last year, reflecting increasing consumption by U.S. defense contractors related to programs that have been funded, including accelerated replenishment of components to support multiple missile programs. In Asia and Europe, we are seeing increasing demand from OEM customers and through EMS. Bookings increased sharply from distribution, driven by orders for resistors in preparation for escalating Department of Defense funding. More products will be needed to support missile programs and also next-generation radar platforms, high-energy weapons for drone defense and drone dominance projects, the Golden Dome, LEO constellations and many more projects. Healthcare revenue increased 7% versus Q1 and 14.7% versus prior year, with long-standing customers in the Americas ramping production and EMS customers in Asia seeing improving demand and supply assurance uncertainties. We continue to identify opportunities to lever -- leverage the full Vishay portfolio in medical. In the other category, which includes telecom, computing and consumer, revenue grew 11.3% quarter-over-quarter and 28.4% year-over-year. Share gains, higher consumption drove volume increases for AI-related programs in Asia, as did higher demand for AI optical communication network switches. In Europe, higher demand for 5G radio projects increased as customers ramp up production. Memory shortages and higher component prices have tempered the consumer segment's demand strength a bit. Across other end markets and technologies, we continue to proactively tackle a wide array of opportunities to gain share, putting into practice the Vishay 3.0 business-minded approach. Historically, Vishay underserved or didn't serve high-margin customers during market upcycles. Vishay 3.0 has been working hard to regain these customers where we had the print position but didn't have the capacity to fulfill orders. I'm pleased to report that we are succeeding at both regaining customers and adding new high-margin growth customers for an overall increase in customer count. We are winning back share and in -- seeing increased design-in and quoting activity. Let's turn to Slide 5 for a review of Q2 by channel. Revenue by channel was led by distribution, which increased from 55% of the total in Q1 to 58% in Q2. Distribution revenue increased 15.6% versus Q1 and 24.2% versus last year, with gains in each region driven by broad-based consumption momentum and reflecting market share gains. Based on distribution reports, we are seeing consumption among existing, new and returning customers. Distribution inventory overall decreased to 18 weeks at quarter end from 20 weeks last quarter, and POS increased 4.7% quarter-on-quarter and 20.5% year-on-year with growth in all regions. Our initiative to expand distributor inventory by part number count and depth during the building of Vishay 3.0 is proving to bring very positive results as we provide strong support in the beginning of this market upcycle. Having a proactive business approach in tune with the availability of product is helping us to win. Strong bookings by distribution customers, particularly for industrial power, AI-related applications and aerospace defense reflect continued demand momentum, amplified by the need to replenish inventory due to stretching lead times. In the Americas, numerous customers are discussing safety stock programs in support of escalating aerospace defense demand. Under Vishay 3.0, we are positioning ourselves to provide far more support to more customers, as reflected in our growing POS and increased SKU count. Good customer support opens up more and more new design opportunities for us. Increasing output to distribution is a top priority, and we are committed to securing share gains and expanding share. Our business unit leaders travel to distributors quarterly to be close to the pulse of the market, gain market visibility and creating more accountability. OEM revenue was up 1.7% quarter-over-quarter and 16.8% year-over-year, reflecting solid demand related to smart grid and AI server power as well as automotive and medical. EMS revenue increased 3.2% quarter-over-quarter and 10.8% year-over-year, reflecting industrial, aerospace defense and automotive program ramps in all regions, plus strengthening demand in AI. Let's go to Slide 6 for the regions. Turning to the geographical mix on this slide. Asia accounted for over half of the revenue increase from the first quarter, increased 12.5% from increased consumption. Sales grew 14.1% in the Americas on increased consumption with orders for passives reaching the highest level we have seen in more than 20 years and semis starting to accelerate as many customers move to volume production. Americas ended the quarter with a book-to-bill of 1.5. Before turning the call over to Dave, I want to thank the Vishay employees and our reps for their hard work as we continue to transform Vishay to perform positively in this upcycle and to support more customers. Their knowledge and contribution to the success of Vishay 3.0 is well done. Everyone recognizes that Vishay is growing because of our work as a team. The early stages of this upcycle are here, and everyone is committed to taking full advantage of the opportunities to drive revenue growth and profitability. Dave, I'll pass the call to you. David McConnell: Thanks, Joel, and good morning, everyone. Let's start a review of the second quarter results with the highlights on Slide 7. Second quarter GAAP revenue was $889 million. Adjusted revenue was $919 million, exceeding our guidance range and increasing 9.5% sequentially, driven by strong volume growth of 7% and an increase in average selling prices of 2%. As a reminder, the difference between the GAAP and adjusted revenue represents the $30 million of tariff refunds received in the second quarter that will be passed through to our customers in the second half of 2026. Compared to the second quarter of 2025, adjusted revenue increased 21%, driven primarily by an 18% increase in volume and a 2% increase in average selling prices. Favorable foreign currency, mainly from the euro, provided an additional 1% benefit. Moving on to the next slide, presenting the income statement highlights. Gross profit was $177 million, delivering a GAAP gross margin of 23.3% and an adjusted gross margin of 22.6%. The adjusted gross margin exceeded our guidance and represents an increase versus prior quarter. Higher volumes and improved pricing conditions drove margin expansion, helping to offset ongoing metals, materials and logistic cost pressures. Depreciation expense was $53 million, relatively flat with quarter 1. SG&A expenses were $154 million, flat versus quarter 1 and within the line with our guidance. GAAP operating margin was 6%. Operating -- adjusted operating margin was 5.8% compared to 2.6% in the first quarter and 1.4% in the second quarter of 2025. EBITDA for the quarter was $105 million for an adjusted EBITDA margin of 11.4%, up from 9.3% in the first quarter. Our GAAP effective tax rate is improving as profitability increases, but remains elevated as items such as U.S. taxation of foreign earnings and repatriation taxes continue to have a disproportionate impact on the effective tax rate. Q2 effective tax rate of 33.7% came in below our guidance range as pretax earnings exceeded expectations. Earnings per share was $0.19 for both GAAP and adjusted compared to $0.05 per share in Q1 and an adjusted loss per share of $0.07 in the second quarter of 2025. Moving on, Slide 9 provides a summary table detailing revenue, gross margin and book-to-bill ratios across our reportable segments for quick reference. All reportable segments delivered revenue growth quarter-over-quarter and versus prior year. Turning to Slide 10. In the second quarter, our cash conversion cycle improved to 110 days from 116 days in quarter 1, in part due to our increased sales volume and our continued disciplined working capital management. DSO improved from 41 days in Q1 to 38 days, primarily due to higher revenues and the impact of our securitization program. Inventory days outstanding improved to 102 days due to increased sales volume. Overall inventory increased slightly to $807 million, mainly due to the building of safety stock and raw materials and WIP as well as to support the increasing backlog. Continuing to Slide 11. You can see we generated $105 million in operating cash in the second quarter, which includes the tariff refunds received that were passed through to customers. We continue to deploy cash for capacity expansion projects. Total CapEx for the quarter was $95 million, including approximately $66 million for our new 12-inch wafer fab in Germany. On a trailing 12-month basis, capital intensity was 10.5%, which is a decrease from 11.3% in the prior year. Free cash flow for the quarter was $10 million, reflecting the increased operating income as well as the tariff refunds received from the U.S. government and additional net cash inflows related to our accounts receivable securitization program. This compares to the negative $47 million in the first quarter. Stockholder returns for the second quarter consisted of our $13.6 million quarterly dividend. We did not repurchase any shares in the quarter. During the quarter, though, we completed a public stock offering of 17.25 million shares of common stock and received cash of $830 million net of issuance costs. At the end of the quarter, our global cash and short-term investment balance was $1.3 billion, and we had $238 million outstanding on our revolver. We used a portion of the proceeds from our public stock offering to repay the outstanding balance on our revolver in July. Our cash and revolver capacity will be used to support an acceleration of our growth initiatives. At the end of the quarter, we had $423 million accessible on our revolving credit facility at the current EBITDA level. The accessible amount increased to approximately $661 million after the repayment of our credit facility in July. Moving on to Slide 11 and the guidance. For the third quarter of '26, revenues are expected to be between $945 million and $975 million. At the midpoint, this represents a 21.4% increase year-over-year and a 4.5% increase quarter-over-quarter, taking into account European seasonality. Gross margin is expected to be in the range of 24.0%, plus or minus 50 basis points, 1 quarter sooner than our goal of exiting the year at 24% quarterly gross margin. Depreciation expense is expected to be approximately $54 million for the third quarter and $215 million for the full year. SG&A expenses are expected to be $155 million, plus or minus $3 million. We're continuing to invest in R&D and customer-facing activities as the overall business environment improves. Interest expense is expected to be approximately $7 million for the third quarter. Our GAAP effective tax rate remains elevated at low levels of pretax income and loss. We expect the effective tax rate to become more predictable and in the range of our historical average as earnings grow. For the third quarter '26, we expect the effective tax rate to be between 35% and 40%. The expected share count for EPS purposes varies based on the average price of our stock during the quarter, primarily due to our convertible debt. Please refer to Slide 21 that displays the range of expected share count for the third quarter. Finally, our Stockholder Return Policy calls for us to return at least 70% of our free cash flow to stockholders in the form of dividends and stock repurchases. For 2026, we once again expect negative free cash flow due to our capacity expansion plans. I'll now turn the call back to Joel. Joel Smejkal: All right. Thanks, Dave. Let's turn to Slide 13 for a review of the strategic levers we are pulling in our efforts to accelerate revenue growth, drive margin expansion and enhance returns. With the proceeds from our recent equity raise, we have the resources to accelerate our growth plans, allowing us to invest across semis and passive technologies in parallel rather than sequentially. All of the strategic levers are in play, there are eight of them. Each supports our efforts to accelerate revenue growth and drive margin expansion and enhance returns. We plan to spend between $400 million and $440 million in CapEx in 2026, with about half of that earmarked for the investments we're making in our 12-inch fab in Germany. At our 12-inch fab in Germany, all of the equipment has been assembled. And we plan to complete installation in the third quarter, so we are ready to start running engineering wafers toward the end of the year. We remain on track with our goal of starting nonautomotive production in mid-2027. At several foundries, we are now ramping up production, which will give us additional wafer capacity to support AI-related application demand starting in the second half of the year. To support the front-end wafer investments, we are working on an initiative to have more dedicated Vishay back-end capacity to reduce our dependency on multiple outside subcontractors. On the passive side, automotive qualifications at our La Laguna and Juarez facilities are ongoing. We are also increasing capacity on our polymer capacitor production by the end of the year, and we will have started an expansion of that capacity in La Laguna. With expanded capacity, we will be able to support more AI and automotive applications. Through our subcontractor initiatives, we continue to expand our portfolio available for distribution. This positions us to increase our share for the customer bill of materials and outsource low-margin commercial-grade products. Our equity raise also gives us more resources to expand our research and development activities and to reignite a disciplined, value-accretive M&A process. In terms of innovation and our new product development work, we are continuing to execute our silicon carbide strategy and development of GaN to participate in the wideband gap market. To accelerate our innovation work, we are stepping up our evaluation of which technologies to acquire. At the same time, we continue to work on new applications at the component level. This quarter, we have won designs in the area of industrial power management, smart grid battery backup systems, energy storage systems, power modules for industrial heating, solar inverters and ADAS systems. Our results year-to-date demonstrate the benefits of our Vishay 3.0 initiatives to put the customer first. We continue to work on the gross margin progression toward 30%, the target of our strategic plan. Channel management and product mix management are main priorities where we proactively and deliberately direct capacity toward higher-margin customers and products to improve mix as part of our business-minded approach under Vishay 3.0. We are no longer simply supporting specific large OEM accounts by taking orders to maximize factory utilization. In closing, our second quarter and first half results demonstrate that Vishay 3.0 is working and propelling us forward to not only take full advantage of the upcycle, outpacing industry growth rates, gaining market share, but also to lay the foundation for sustained growth, leveraging multiyear demand across these markets and as a new company, expanding margins and enhancing shareholder returns. Olivia, we are now ready to open the call for the first question. Operator: [Operator Instructions] Our first question comes from the line of Ruplu Bhattacharya from Bank of America Merrill Lynch. Ruplu Bhattacharya: Joel, maybe can you talk a little bit more about the use of foundries? What utilization are your fabs running at today? And what percent of your manufacturing is at foundries? And can you weave in your expectations for the Newport fab in terms of wafers per month you expect by the end of this year? And same for the fab that's coming up in Germany, what wafers per month capacity are you targeting for 2028? Joel Smejkal: Ruplu, use of foundries, we have spoke previously about putting our technology structures at foundries in Korea. We have two that we're working with. A additional one in China. Those are coming on board here in the third quarter. That's going to help us increase our capacity for AI wafers and AI end products. The Newport fab, we continue to have the automotive audits. We're well into the single digits of -- 9 of 10 customer audits have been completed, a couple more to go. Getting the customer programs to accept the PCNs is the next step, and this has taken a little time. We're working with the customer closely. When we get the Tier 1 customer programs approved, the utilization of the Newport fab will increase. We're expecting to see more and more programs approved every month through the end of the year. By having those programs approved in Newport, we're able to open capacity in the Itzehoe 8-inch fab, which is going to help us. So the capacity increase second half and into the first half of '27 will be: Itzehoe 8-inch; Korea, two foundries; and another foundry in China. The 12-inch fab, we talk about first qualifying the nonautomotive commercial parts so we can run the fab much faster than Newport was started. That is still on target for mid-'27. As far as wafer counts, we're not ready to share that at this time. We are making good progress with the fabs and capacity. Ruplu Bhattacharya: Okay. We're also getting some -- so there have been some media reports that for AI applications or power applications, maybe some vendors want to use more MLCCs versus polymer tantalum. Can you give us your thoughts on Vishay's exposure to MLCC? And is that something that you would want to increase over time? Or do you think the exposure to polymer tantalum is more important? And what is your current percent of revenue from polymer tantalum and do you plan to expand that? So just MLCC versus polymer tantalum use and your exposure to those? Joel Smejkal: MLCC, we have products which are more specialized. The MLCCs that we have is more for military and more for medical. We do get some orders for AI or compute programs when the lead times are long for other -- from other MLCC suppliers. We still see the demand for polymer tantalum, polymer tantalum in automotive, polymer tantalum in AI. So I know there's some talk about MLCCs versus polymer, but we're still seeing demand grow for polymer. We're expanding our polymer output through the end of this year at the current locations that we're in, and we'll be expanding capacity at a new site in La Laguna, Mexico. So polymer will be a growing part of our portfolio. We see very long lead times from competition, but the interest from customers is still very strong to add Vishay to this product set. Ruplu Bhattacharya: Okay. If I can just squeeze one more in, Dave. Can you talk about like CapEx this year and versus next year, how should we think -- do you think CapEx maintains at this level? Or do you see that increasing or decreasing? And your spend on CapEx versus buybacks, how should we think about capital allocation, if you can give a general framework? David McConnell: Ruplu. So I think we're sticking with the $400 million to $440 million CapEx this year, okay? We're halfway there through 6 months. Next year we're not going to give you a number yet. I think what we would say though is our capital intensity will continue to drop back down to lower levels and not stay at the 11%, 10% range. Absolute dollars, it still may be a fairly high number, but as a percentage, as capital intensity number, it should drop. Operator: Our next question comes from the line of David Williams with Needham. David Williams: Congrats on the really solid progress here. I guess, maybe first on the gross margin line. It seems like you've got some better leverage there, as we've kind of inflected. Just kind of curious how you think about the gross margin? Obviously, we have your longer term targets and you pulled that forward a bit. You said in the script, maybe a quarter on that 24%. But do you think that we have more room here to grow? And how should we think about this margin kind of going forward, what does that trajectory look like? Has it changed? Or are we still kind of where you thought we would be at this point? Joel Smejkal: We're happy to accelerate that 24% that we said we were going to exit the fourth quarter. We say we could hit that in Q3. We've got a series of initiatives that are going to help the margin. The short term is the volume for sure. The volume helps us with the variable margin. ASPs, we're increasing ASPs, and that's also helping the variable and gross margin. The channel management, as we look at our backlog and we position our backlog to support higher-margin customers, that gives us an immediate short-term impact. Each division has annual cost savings targets they need to hit. So those will be rolling in quarter-on-quarter. They don't all happen in the first half of the year. It takes some time through the year to go. Maximizing the Newport fab, we increase the utilization there to carry cost away and make that even more and more accretive quarter-on-quarter with these automotive program approvals. The Itzehoe 12-inch middle of the '27 is going to start helping us there as well, we'll get the economies of a 12-inch wafer. The back-end semiconductor finishing, putting that in a low-cost country and reducing our dependency on subcontractors. We've got quite a few of them that are building parts for us. So this will be a help. We won't have to pay the margin of the subcontractor, we can have it in with Vishay. The factory optimization, we talk about footprint optimization, we got a lot of factories. So this is another initiative which begins in '27, aging in '26, starting in '27, '28, which is another one of the eight, which is going to continue to give us the lift in gross margin. We've got many levers to pull here, and all of them are active. David McConnell: Yes. I think, David, I think to your point, though, I think what Joel has laid out is '28 number is still not accelerating into the beginning of '27, and we're going to reach the 30% from the Investor Day. David Williams: And you talked a little bit about the escalations in the script as well. Just kind of curious if you could talk about how broad-based that was? And are there any concerns here potentially getting to a point where we're double ordering or where things maybe are getting a little out of hand? Or do you think we're still fairly rational in the ordering pace that we're seeing today? Joel Smejkal: I think at this point, it's still fairly rational. We look at items like the POS. The POS is growing for Vishay, so consumption is going out the door of distribution. The weeks of inventory has gone down each of the quarters. So the distributors, even though they speak about the need to replenish, they haven't been able to do it. People are placing orders further out because of the concern of the high AI demand that they might miss, other market segments might miss the opportunity to get products. So we're seeing those orders for positioning to their programs. When I talk to a lot of colleagues across the industry, not seeing the double ordering at this point, there's some long lead time products out there. But at this point, it's supporting consumption. It's supporting demand. We're going to watch it every quarter. We're going to keep watching our indices, our metrics. But at this point, we say we're early. We're early in this upcycle. David Williams: Great. And if I could squeeze just one last one in. As you kind of think about the strength within the AI data center, how would you rank that in terms of the demand strength that you're seeing today relative to maybe how you entered the year and what your expectations were? Would you say it's significantly higher, about the same? Or just maybe any color around that? Joel Smejkal: Demand -- yes, demand for AI is growing with the hybrid model of semis and passives. We're getting more and more passives on the bill of materials. So that's growing. The MOSFETs, the diodes, we've been on the bill of materials. We need to get the Korean foundry moving here in the third quarter with wafers, and then we can support more of the AI MOSFETs and diodes in the later part of the year. So that's growing. I think we're growing at a good rate, pushing for more for sure. There's more that we could support short term. There's continued escalations not just because of Vishay orders, but we also have opportunities where our competitors are not able to supply, and we're getting those escalation opportunities. So AI has continued strong, and we're pushing to be even a bigger player than we are today. Operator: Our next question comes from the line of Melissa Fairbanks with Raymond James. Melissa Dailey Fairbanks: Joel, you kind of provided a lot of color behind this already, but I was kind of curious, this is a question that's been coming up on a lot of calls this quarter. You did communicate that there have been some price increases. You expect to see some price increases. It may not technically be double ordering yet, but are you seeing any pull forward related to once you communicate these price increases, people are wanting to get the inventory or the capacity locked in? Joel Smejkal: Yes. We see the intention, but the way we're doing the price increases, we are updating the backlog rather quickly. So to be able to try and get ahead of the queue and have a ship within weeks, we're updating the backlog to the new price. So we don't see that people are able to get ahead of it. We do see Tier 1 automotives trying to put inventory in place. OEMs are pushing them to get some inventory in place. But even that's a challenge because of the loads that are in our manufacturing lines, plus we believe our competitors, it's quite difficult for somebody to try and build inventory and get ahead of something. It's a pretty dynamic business we're in. It's growing in all market segments. Capacities are being filled quarter-on-quarter. As new capacities land, those are being loaded very quickly. So I think the price increases are being implemented, and not just a paper price increase. I think they're real. They're coming quick and it's hard for somebody to pull anything ahead. Melissa Dailey Fairbanks: Okay. Great. I assume increase in [indiscernible] business within the quarter reflects that as well, but that's not happening. And it would be great if the Tier 1 auto guys could have learned a lesson from the last supply chain crisis, but here we are. Joel Smejkal: Yes, we have this revolving thing going on here, don't we? Yes. Melissa Dailey Fairbanks: Yes. One last question from me. To the extent that you are expanding the portfolio available for distribution, and that way you're going to capture more content on a board or more content in a design, is there an aspect of demand creation that we may need to think about in terms of impacting the margin? Or is that just negligible as we look at increasing content? Joel Smejkal: For the most part, it's negligible. Getting the strength of the distributor FAEs with their design registrations is a good benefit. We've got the Vishay FAEs out there, but when we can multiply the headcount with the distributor FAEs and incentivize them to go out and put Vishay on the bill of materials, it's a plus-plus. So the cost is negligible for us. Operator: I am showing no further questions at this time. I would now like to turn the call back over to Joel for closing remarks. Joel Smejkal: All right. Thank you, Olivia. To sum up today's call, our Q2 and first half results demonstrate that Vishay 3.0 is working as intended and positioning Vishay to fully participate in the industry upcycle, outpacing industry growth while we continue to gain share and to prepare Vishay for long-term sustainable growth. In the third quarter, we will be attending the Needham Virtual Semiconductor and SemiCap Conference on August 18, and we'll also be in person at the Citi Global Conference on September 9. Hope to see many of you there. Thank you very much for attending our call. Have a great week. Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Before you buy stock in Vishay Intertechnology, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vishay Intertechnology wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $403,337!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,334,946!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 12, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Vishay (VSH) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

MALVERN, Pa., Aug. 12, 2026 (GLOBE NEWSWIRE) -- Vishay Intertechnology, Inc. (NYSE:VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, announced today that the Company’s Board of Directors declared a dividend of $0.10 per share of common stock and Class B common stock, to be paid September 24, 2026 to stockholders of record as of the close of business September 10, 2026. Future dividends will be subject to Board approval. About VishayVishay manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and healthcare markets. Serving customers worldwide, Vishay is The DNA of tech.® Vishay Intertechnology, Inc. is a Fortune 1,000 Company listed on the NYSE (VSH). More on Vishay at www.vishay.com. Forward-Looking Statements Statements contained herein that relate to the Company's future cash dividends on its common stock and Class B common stock are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as “to be,” "will be," or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand due to political, economic, and health instability and military conflicts and hostilities; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; volatility in prices for metals and materials; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The DNA of tech® is a trademark of Vishay Intertechnology. Contact: Vishay Intertechnology, Inc.Peter HenriciExecutive Vice President, Corporate Development+1-610-644-1300

Interested in Vishay Intertechnology, Inc.? Here are five stocks we like better. Second-quarter performance exceeded expectations: Adjusted revenue reached $919 million, up 9.5% sequentially and 20.5% year over year, while adjusted EPS rose to $0.19 from a loss of $0.07 a year earlier. Demand and backlog strengthened: Book-to-bill was 1.32, backlog increased 18% to $1.9 billion, and growth was broad-based, led by industrial, AI-related, automotive, aerospace and defense markets. Distributor inventories declined while point-of-sale activity increased, supporting management’s view that demand remains healthy. Vishay raised its growth trajectory and expanded capacity: The company expects third-quarter revenue of $945 million to $975 million and a gross margin near 24%. It is investing heavily in its German 12-inch wafer fab and additional foundry, capacitor and semiconductor capacity to support AI-related demand. Active Rebound: 2 Discrete Semiconductor Stocks Making Moves Vishay Intertechnology (NYSE:VSH) reported second-quarter 2026 adjusted revenue of $919 million, above the high end of its guidance range, as demand increased across its semiconductor and passive-component businesses, end markets, sales channels and regions. GAAP revenue was $889 million, reflecting $30 million in tariff refunds that the company said will be passed through to customers during the second half of 2026. Vishay said the refunds reduced both reported net revenue and cost of products sold, with no impact on gross profit. Management used adjusted revenue, excluding the tariff refunds, in discussing quarterly performance. → No Hangover: Revisiting Microsoft One Week After Earnings Alpha and Omega Semiconductor ready to bounce, DOJ cloud lifts Adjusted revenue rose 9.5% from the first quarter and 20.5% from the year-earlier period. Chief Financial Officer David McConnell said the year-over-year increase was driven primarily by an 18% rise in volume, a 2% increase in average selling prices and a 1% foreign-currency benefit, mainly from the euro. President and Chief Executive Officer Joel Smejkal said the company’s second-quarter book-to-bill ratio was 1.32, including 1.23 for semiconductors and 1.40 for passive components. Vishay recorded record bookings for resistors and inductors, and total backlog rose 18% to $1.9 billion, representing 6.1 months of backlog. → MarketBeat Week in Review – 08/03 - 08/07 Smejkal said customers have been extending their ordering visibility as industry lead times lengthen and concerns over product availability persist. Many customers are forecasting six months ahead, while demand tied to artificial-intelligence applications has led some customers to place orders more than 52 weeks in advance, he said. Management said it has announced price increases on about one-third of its running part numbers since the fourth quarter of 2025, citing higher costs for metals, materials and logistics. Some of those increases were reflected in second-quarter results. Smejkal told analysts that Vishay has been updating backlog pricing quickly, limiting customers’ ability to pull forward shipments ahead of the price changes. → Why the Landlord of the AI Boom Could Outlast the Chipmakers Asked about the potential for double ordering, Smejkal said the company currently views order activity as “fairly rational.” He pointed to increasing point-of-sale activity at distributors and declining distributor inventory levels as indications that demand is being supported by consumption. Distribution inventory declined to 18 weeks at quarter-end from 20 weeks in the first quarter, while distributor point-of-sale rose 4.7% sequentially and 20.5% year over year. All reported end markets posted sequential and year-over-year revenue gains. Industrial revenue increased 16.2% from the first quarter and 30.1% from a year earlier, driven by demand for smart-grid, AI power, high-voltage DC and factory-automation projects. Smejkal said industrial represented more than half of Vishay’s sequential revenue increase. Automotive revenue rose 3.6% sequentially and 10.1% year over year, reflecting demand associated with driver-assistance systems, autonomous-driving applications and hybrid and electric-vehicle platforms. Aerospace and defense revenue increased 4.2% from the prior quarter and 15.4% from the prior year, supported by U.S. defense programs and demand from customers in Asia and Europe. Healthcare revenue grew 7% sequentially and 14.7% year over year. Revenue in the company’s “other” category, which includes telecom, computing and consumer markets, rose 11.3% sequentially and 28.4% from a year earlier, aided by AI-related programs, optical communication network switches and European 5G radio projects. Distribution accounted for 58% of revenue in the second quarter, up from 55% in the first quarter. Distribution revenue rose 15.6% sequentially and 24.2% year over year. OEM revenue increased 1.7% sequentially and 16.8% year over year, while EMS revenue rose 3.2% sequentially and 10.8% year over year. Vishay generated gross profit of $177 million. GAAP gross margin was 23.3%, while adjusted gross margin was 22.6%, exceeding the company’s guidance and improving from the prior quarter. McConnell attributed the expansion to higher volumes and improved pricing, partially offset by continued metals, materials and logistics cost pressures. Adjusted operating margin rose to 5.8%, compared with 2.6% in the first quarter and 1.4% in the second quarter of 2025. Adjusted EBITDA margin increased to 11.4% from 9.3% in the first quarter. GAAP and adjusted earnings per share were both $0.19, compared with $0.05 in the first quarter and an adjusted loss of $0.07 per share a year earlier. The company generated $105 million in operating cash flow and $10 million in free cash flow during the quarter. Capital expenditures totaled $95 million, including approximately $66 million for Vishay’s new 12-inch wafer fabrication facility in Germany. During the quarter, Vishay completed a public offering of 17.25 million common shares, raising $830 million in cash after issuance costs. The company ended the quarter with $1.3 billion in cash and short-term investments and $238 million outstanding on its revolver. McConnell said Vishay used a portion of the offering proceeds to repay the revolver balance in July. For the third quarter, Vishay expects revenue of $945 million to $975 million. At the midpoint, the outlook implies 4.5% sequential growth and 21.4% year-over-year growth, including the effect of European seasonality. The company expects gross margin of 24.0%, plus or minus 50 basis points, reaching its prior target of exiting 2026 at a 24% quarterly gross margin one quarter earlier than planned. Third-quarter SG&A expense is expected to be $155 million, plus or minus $3 million. Depreciation expense is expected to be about $54 million for the quarter and $215 million for the full year. Interest expense is expected to be approximately $7 million. The expected GAAP effective tax rate is 35% to 40%. Smejkal said Vishay plans capital expenditures of $400 million to $440 million in 2026, with roughly half allocated to the German 12-inch fab. Equipment assembly at the facility has been completed, and installation is expected to finish in the third quarter. The company plans to begin running engineering wafers near year-end and remains on track to start non-automotive production in mid-2027. Vishay is also ramping production through foundries in Korea and China to add wafer capacity for AI-related applications in the second half of 2026. The company is expanding polymer capacitor capacity and pursuing additional back-end semiconductor capacity, while continuing development work in silicon carbide and gallium nitride technologies. Vishay Intertechnology, Inc is a global manufacturer of discrete semiconductors and passive electronic components, serving a wide range of industries including industrial, automotive, computing, consumer electronics, telecommunications, medical, and military/aerospace markets. The company's portfolio encompasses resistors, capacitors, inductors, sensors, diodes, rectifiers, MOSFETs and a variety of integrated circuit solutions. Vishay's components are used in power management, signal conditioning, circuit protection and sensing applications, supporting both standard and custom designs for original equipment manufacturers worldwide. Originally founded in 1962 by Dr. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Vishay Intertechnology Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Vishay Intertechnology, Inc. VSH reported second-quarter 2026 earnings of 19 cents per share, beating the Zacks Consensus Estimate by 26.67%. Earnings jumped 19-fold from the year-ago quarter’s earnings of a penny, aided by higher volumes, improved pricing and stronger operating leverage. Revenues rose 16.6% year over year to $888.6 million but missed the consensus mark by 0.54%. Adjusted revenues were $918.6 million. Book-to-bill reached 1.32, while backlog stood at 6.1 months. Adjusted revenues increased 9.5% sequentially and 20.5% year over year. Volume rose 7% from the prior quarter and 18% from a year earlier, while average selling prices improved 2% in both comparisons. Favorable currency movements added 1% to year-over-year growth. Management cited stronger demand across product technologies, end markets, channels and regions. Customers also provided longer order visibility as lead times stretched and supply assurance concerns increased. Total backlog rose 18% to $1.9 billion. Vishay Intertechnology, Inc. price-consensus-eps-surprise-chart | Vishay Intertechnology, Inc. Quote Industrial revenues climbed 16.2% sequentially and 30.1% year over year, accounting for more than half of the quarter’s revenue increase. Demand was supported by smart grid, artificial intelligence power, high-voltage direct-current projects and factory automation. Automotive revenues advanced 3.6% from the prior quarter and 10.1% from the year-ago period. Aerospace and defense sales increased 4.2% sequentially and 15.4% year over year, while healthcare revenues grew 7% and 14.7%, respectively. Other end-market revenues rose 11.3% sequentially and 28.4% year over year. Distribution revenues jumped 15.6% sequentially and 24.2% year over year, lifting the channel’s share of total revenues to 58% from 55% in the first quarter. Point-of-sale activity rose 4.7% sequentially and 20.5% year over year, while distributor inventory declined to 18 weeks from 20 weeks. OEM revenues improved 1.7% from the prior quarter and 16.8% from a year earlier. EMS revenues increased 3.2% sequentially and 10.8% year over year, reflecting program ramp-ups in industrial, aerospace and defense, automotive and AI applications. Resistors remained the largest segment, with revenues of $215 million, up from $203.7 million in the first quarter and $194.8 million a year earlier. MOSFET revenues were $188.9 million, while Diodes generated $187 million. Optoelectronic Components contributed $70.1 million. Capacitor revenues reached $153.4 million, and Inductors produced $104.2 million. Inductors posted the highest gross margin at 31.1%. Book-to-bill was strongest in Resistors at 1.43, followed by Inductors at 1.42. Gross profit rose to $207.4 million from $148.7 million a year ago. GAAP gross margin expanded 380 basis points to 23.3%, while adjusted gross margin was 22.6%. Higher volumes and improved pricing helped offset metals, materials and logistics cost pressures. Selling, G&A expenses increased to $153.9 million from $126.6 million. Operating margin improved to 6% from 2.9%, while adjusted operating margin reached 5.8%. Adjusted EBITDA margin increased to 11.4% from 8.3% in the prior-year quarter. Operating cash flow was $105.4 million compared with an outflow of $8.8 million a year earlier. Capital expenditures totaled $95.2 million, including about $66 million for the new 12-inch wafer fab in Germany. Free cash flow was $10.3 million versus negative $73.2 million. Cash and cash equivalents totaled $1.30 billion at quarter-end. Inventories increased to $807.1 million as the company built safety stock and supported higher backlog. Vishay also completed a public stock offering that generated $830 million in net proceeds. For the third quarter of 2026, Vishay expects revenues between $945 million and $975 million. At the midpoint, the outlook implies growth of 4.5% sequentially and 21.4% year over year. Gross margin is projected at 24%, plus or minus 50 basis points. SG&A expenses are expected at $155 million, plus or minus $3 million, while interest expense is forecast at about $7 million. The company maintained its 2026 capital spending plan of $400 million to $440 million. Vishay currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Zacks Computer and Technology sector are Lumentum LITE, Applied Materials AMAT and Analog Devices ADI, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Shares of Lumentum have surged 123% year to date. The Zacks Consensus Estimate for LITE’s fiscal 2026 earnings is pegged at $8.19 per share, up by 5 cents over the past 30 days, indicating an increase of 297.6% year over year. Shares of Applied Materials have jumped 107.9% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 3 cents over the past 30 days, implying a rise of 28.9% year over year. Analog Devices shares have rallied 39.2% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, calling for a rise of 33.9% year over year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Vishay Intertechnology, Inc. (VSH) : Free Stock Analysis Report Analog Devices, Inc. (ADI) : Free Stock Analysis Report Applied Materials, Inc. (AMAT) : Free Stock Analysis Report Lumentum Holdings Inc. (LITE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Vishay Intertechnology, Inc. VSH framed its second-quarter 2026 call around an early industry upcycle, broad demand gains and a faster path to higher margins. Management said stronger bookings, rising customer counts and added capacity are helping the company capture more industrial, AI, automotive and aerospace business. The company reported earnings of 19 cents per share, which beat the Zacks Consensus Estimate of 15 cents. GAAP revenues of $888.6 million missed the $893.4 million consensus mark, while adjusted revenues totaled $918.6 million after excluding tariff refunds passed through to customers. Vishay Intertechnology, Inc. price-consensus-eps-surprise-chart | Vishay Intertechnology, Inc. Quote President and chief executive officer Joel Smejkal said adjusted revenues rose 9.5% sequentially and 20.5% year over year, with growth across technologies, end markets, channels and regions. Book-to-bill reached 1.32, including 1.23 for semiconductors and 1.40 for passive components. Backlog increased 18% to $1.9 billion, equal to 6.1 months of sales. CEO Smejkal said industrial demand led the increase, supported by smart-grid projects, AI power infrastructure, high-voltage direct-current systems and factory automation. He also cited stronger automotive, aerospace and defense, healthcare, computing and telecommunications demand. Executive vice president and chief financial officer David McConnell guided third-quarter revenues to $945 million to $975 million. At the midpoint, that represents 4.5% sequential growth and 21.4% year-over-year growth, including European seasonality. Gross margin is expected at 24%, plus or minus 50 basis points. CFO McConnell said that level would arrive one quarter earlier than the prior goal of exiting 2026 at a 24% margin. CEO Smejkal attributed the progress to volume, pricing, channel management, cost savings and product mix. Management continues to target a 30% gross margin under Vishay 3.0. CEO Smejkal said proceeds from the equity offering allow Vishay to invest in semiconductor and passive-component capacity in parallel. The company expects 2026 capital expenditures of $400 million to $440 million. Equipment for the new 12-inch wafer fab in Germany has been assembled, with installation planned for the third quarter. Engineering wafers are expected near year-end, followed by nonautomotive production in mid-2027. A BofA Securities analyst requested detailed wafer-capacity targets. CEO Smejkal declined to provide them but said Korean and Chinese foundries should add AI-related capacity in the third quarter, while automotive approvals should lift utilization at the Newport fab. A Needham analyst asked whether longer lead times and rising prices were producing double ordering. CEO Smejkal characterized ordering as rational and said Vishay remains early in the upcycle. Point-of-sale activity through distribution increased 4.7% sequentially and 20.5% year over year. Distributor inventory fell to 18 weeks from 20 weeks, as consumption continued to outpace replenishment. A Raymond James analyst asked about orders being pulled forward before price increases. CEO Smejkal said Vishay quickly updates backlog pricing, limiting access to old prices, while crowded production lines also constrain inventory building. CFO McConnell said Vishay raised $830 million net through its stock offering and ended the quarter with $1.3 billion in cash and short-term investments. The company repaid its revolver balance in July. Management plans to use the liquidity for capacity, research and development, and a renewed value-accretive acquisition process. Vishay also continues to expand polymer capacitor output and reduce reliance on outside semiconductor assembly providers. A BofA Securities analyst asked about 2027 spending and buybacks. CFO McConnell gave no 2027 capital-expenditure target but said capital intensity should decline from recent 10% to 11% levels. Vishay still expects negative free cash flow in 2026 because of expansion spending. Management’s tone remained confident on demand while focused on execution. Vishay 3.0 centers on serving more customers, directing capacity toward higher-margin business and expanding the portfolio available through distributors. Near-term priorities are converting backlog into shipments, adding capacity without sacrificing lead times and sustaining margin improvement as pricing and cost pressures move through results. VSH carries a Zacks Rank #3 (Hold). Its Growth Score is A, VGM Score is B, Value Score is C and Momentum Score is D, creating a favorable growth profile but a weaker momentum signal. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Style Scores complement the Zacks Rank, with A and B grades carrying the greatest weight alongside Zacks Rank #1 or #2 stocks. The current Zacks Rank #3 supports a neutral near-term view, and the Rank can change as earnings estimates are revised after the reported results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Vishay Intertechnology, Inc. (VSH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Vishay Intertechnology Inc (NYSE:VSH) reported record Q2 2026 adjusted revenue of $919 million, exceeding the top end of guidance, with strong 20.5% year-over-year growth and 9.5% sequential growth. The company achieved a record-high book-to-bill ratio of 1.32 in Q2, with total backlog growing 18% to $1.9 billion (6.1 months), driven by strong demand across all segments. Gross margin expansion is ahead of schedule, with Q3 2026 guidance of 24.0% (plus or minus 50 bps) achieved one quarter earlier than the original goal of exiting the year at that level. Demand is broad-based and accelerating, particularly in industrial (up 30.1% YoY), AI-related applications, and aerospace/defense, with customers placing orders beyond 52 weeks to secure supply. The company is successfully executing its Vishay 3.0 strategy, gaining market share in both semis and passives, with distribution POS up 20.5% YoY and inventory levels decreasing to 18 weeks, indicating healthy consumption. Vishay Intertechnology Inc (NYSE:VSH) raised $830 million through a public stock offering, providing ample resources to accelerate capacity expansion, R&D, and M&A initiatives across both semis and passives in parallel. The company is making solid progress on strategic capacity investments, including the 12-inch fab in Germany (on track for mid-2027 production) and ramping foundry partnerships in Korea and China to support AI demand. Adjusted operating margin improved significantly to 5.8% in Q2 from 2.6% in Q1 and 1.4% in the prior year, reflecting improved pricing and volume leverage. Cash conversion cycle improved to 110 days from 116 days in Q1, with operating cash flow of $105 million and free cash flow turning positive at $10 million. The company is seeing successful price increase implementation, with about a third of part numbers announced for increases, contributing to a 2% ASP improvement in Q2. Vishay Intertechnology Inc (NYSE:VSH) continues to face elevated effective tax rates (33.7% in Q2, expected 35-40% in Q3) due to US taxation of foreign earnings and repatriation taxes, which disproportionately impacts profitability. The company expects negative free cash flow for full-year 2026 due to heavy capacity expansion plans, despite generating positive free cash flow in Q2. Gross margin remains relatively low at 22.6% (adjusted) in Q2, still far from the 30% long-term target, with ongoing metals, materials, and logistics cost pressures partially offsetting volume and pricing gains. The company faces ongoing challenges with the Newport Fab automotive qualifications, with customer program approvals taking longer than expected, delaying full utilization of that facility. Memory shortages and higher component prices are tempering demand strength in the consumer segment, creating some headwinds in that market. The company's heavy reliance on outside subcontractors for back-end capacity remains a concern, though initiatives are underway to reduce this dependency. Despite strong demand, the company acknowledges that customers are concerned about product availability and supply assurance, leading to potential risks of order cancellations if lead times normalize. The company's capital intensity remains high at 10.5% (trailing 12 months), and while expected to decrease, absolute CapEx spending of $400-440 million in 2026 limits near-term shareholder returns. The company did not repurchase any shares in Q2, and with negative free cash flow expected for the year, stockholder returns are limited to the quarterly dividend of $13.6 million. The effective tax rate is expected to remain elevated in Q3 (35-40%), which will continue to pressure net income and EPS despite improving operational performance. Warning! GuruFocus has detected 8 Warning Signs with VSH. Is VSH fairly valued? Test your thesis with our free DCF calculator. Q: Can you talk about the use of foundries, current fab utilization, and expectations for the Newport Fab and the new 12-inch fab in Germany in terms of wafer capacity?A: Joel Smejkal (President and CEO): We are ramping up production at two foundries in Korea and one in China in Q3 to increase capacity for AI-related wafers. The Newport Fab is progressing through automotive customer audits, with single-digit audits completed and a few more to go. As tier-one customer programs get approved, utilization will increase, opening up capacity in the 8-inch fab. The 12-inch fab in Germany is on track to start non-automotive production in mid-2027, with all equipment assembled and installation to be completed in Q3. We are not ready to share specific wafer count targets at this time. Q: There are media reports that AI power applications may use more MLCCs versus polymer tantalum. What is Vishay's exposure to MLCC, and do you plan to expand polymer tantalum capacity?A: Joel Smejkal (President and CEO): Our MLCC products are more specialized for military and medical applications, though we do receive orders for AI or compute programs when other suppliers have long lead times. We still see strong demand for polymer tantalum in automotive and AI applications. We are expanding our polymer output through the end of this year at current locations and will expand capacity at a new site in La Laguna, Mexico. Polymer will be a growing part of our portfolio, and customer interest remains strong despite long competitive lead times. Q: Can you provide an update on CapEx for this year and next, and how should we think about capital allocation between CapEx and buybacks?A: Dave McConnell (CFO): We are sticking with the $400-440 million CapEx guidance for this year, and we are halfway there through six months. For next year, we are not giving a specific number yet, but capital intensity will continue to drop back down to lower levels and not stay at the 10-11% range. Absolute dollars may still be fairly high, but as a percentage of revenue, it should decrease. Q: You pulled forward the 24% gross margin target to Q3. Do you think there is more room to grow, and what does the margin trajectory look like going forward?A: Joel Smejkal (President and CEO): We are happy to accelerate the 24% gross margin target to Q3, a quarter sooner than planned. Short-term drivers include higher volumes, increasing ASPs, and channel management to support higher-margin customers. Each division has annual cost savings targets that will roll in quarter over quarter. Maximizing Newport Fab utilization, the 12-inch fab economies of scale in mid-2027, moving back-end semiconductor finishing to low-cost countries, and factory footprint optimization are all levers that will continue to lift gross margins. Dave McConnell (CFO) added that the 30% target from investor day remains intact, with acceleration into the beginning of 2027. Q: You mentioned escalations in the script. How broad-based is this, and are there concerns about double ordering or the ordering pace getting out of hand?A: Joel Smejkal (President and CEO): At this point, ordering is still fairly rational. POS is growing for Vishay, indicating consumption is going out the door of distribution. Inventory weeks have decreased each quarter, so distributors haven't been able to replenish despite their need. Customers are placing orders farther out due to concerns about AI demand and product availability. When talking to colleagues across the industry, we are not seeing double ordering at this point. We will continue to watch our metrics closely, but we believe we are still early in this upcycle. Q: How would you rank the demand strength in AI data centers relative to your expectations at the start of the year?A: Joel Smejkal (President and CEO): Demand for AI is growing, and with our hybrid model of semis and passives, we are getting more passive components on the bill of materials. We are already on the bill of materials for MOSFETs and diodes. With the Korean foundry ramping in Q3, we can support more AI MOSFETs and diodes later this year. There is more we could support short-term, and we are seeing continued escalations not just from our own orders but also from opportunities where competitors cannot supply. AI is computing strong, and we are pushing to be an even bigger player. Q: Are you seeing any pull-forwards related to price increase announcements, where customers are trying to get ahead of the increases?A: Joel Smejkal (President and CEO): We are updating the backlog to new prices rather quickly, so customers are not able to get ahead of the price increases. We do see tier-one automotive customers trying to build inventory, but even that is challenging due to the loads in our manufacturing lines. The price increases are real and being implemented quickly, and it is difficult for anyone to pull anything ahead in this dynamic environment. Q: As you expand the portfolio available for distribution to capture more content on the board, is there a demand creation aspect that could impact margins?A: Joel Smejkal (President and CEO): For the most part, the cost is negligible. We benefit from the strength of distributor FAEs with their design registrations. We have our own FAEs, but multiplying our headcount with distributor FAEs and incentivizing them to put Vishay on the bill of materials is a plus-plus. The cost is negligible for us. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Revenue growth of 9.5% sequentially was driven by strengthening demand across all product technologies, particularly in industrial, AI, and aerospace sectors. The 'Vishay 3.0' strategy is successfully regaining high-margin customers by leveraging $900 million in recent capacity investments to offer better supply assurance than competitors. Market share gains are being realized through increased customer counts and higher consumption volumes, specifically in smart grid and AI power management applications. Management is shifting away from simply maximizing factory utilization for large OEMs toward a 'business-minded' approach that prioritizes higher-margin products and customers. Pricing power has improved, with price increases announced for approximately 1/3 of running part numbers to offset rising material and logistics costs. The hybrid business model, offering both discrete semiconductors and passive components, allows Vishay to populate over 80% of components on power application boards. Geopolitical dynamics are favoring Vishay as customers increasingly request Western-located manufacturing sources to ensure supply chain security. Q3 guidance anticipates gross margin reaching 24.0% one quarter ahead of previous targets, driven by volume leverage and favorable product mix. The 12-inch wafer fab in Germany remains on track for engineering wafers by late 2026 and non-automotive production by mid-2027. New foundry partnerships in Korea and China are expected to provide additional wafer capacity for AI-related demand starting in the second half of 2026. CapEx for 2026 is projected between $400 million and $440 million, with roughly half dedicated to the German 12-inch fab expansion. Strategic focus is shifting toward internalizing back-end semiconductor finishing to reduce dependency on subcontractors and capture additional margin. Adjusted revenue excludes $30.0 million in tariff refunds that are being passed through to customers with no net impact on gross profit. A public stock offering in Q2 raised $830 million net, which was used to repay revolver debt and will fund accelerated growth initiatives. Backlog grew 18% to $1.9 billion, representing 6.1 months of visibility as customers place longer-term orders to secure production slots. Inventory days improved to 102 days despite a slight increase in absolute inventory levels to support growing backlog and safety stock requirements. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Newport fab utilization is expected to increase monthly as Tier 1 automotive customers complete audits and approve program transfers. Foundries in Korea and China will begin contributing AI-specific wafer capacity in Q3 2026 to meet surging demand. Management remains confident in polymer tantalum demand for AI and automotive, despite industry reports of MLCC substitution. Vishay is expanding polymer capacity in Mexico to address long competitor lead times and strong customer interest. Management views current ordering as rational and supported by actual consumption, noting that distribution inventory levels are still declining. Price increases are being applied to existing backlogs quickly, preventing customers from 'pulling forward' orders to avoid higher costs.

MALVERN, Pa., Aug. 05, 2026 (GLOBE NEWSWIRE) -- Vishay Intertechnology, Inc., (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive electronic components, today announced results for the fiscal second quarter ended July 4, 2026. Highlights 2Q 2026 GAAP revenues of $888.6 million; adjusted revenues of $918.6 million GAAP revenues reduced by $30.0 million of tariff refunds passed through to customers, with no impact on gross profit Gross margin was 23.3%; adjusted gross margin was 22.6% Operating margin was 6.0%; adjusted operating margin was 5.8% 2Q 2026 diluted EPS of $0.19 2Q 2026 book-to-bill of 1.32 with book-to-bill of 1.23 for semiconductors and 1.40 for passive components Backlog at quarter end was 6.1 months “For the second quarter, Vishay delivered 9.5% sequential growth to adjusted revenue of $919 million, exceeding the top end of our revenue guidance and representing continued strengthening demand across all end markets, channels and regions,” said Joel Smejkel, president and CEO. “Executing as a new company, Vishay 3.0 is focused on supplying our increasing customer count and taking full advantage of the upcycle, outpacing industry growth, while laying the foundation to leverage multi-year demand across all end markets for sustained growth, expanded margins and enhanced stockholder returns.” 3Q 2026 OutlookFor the third quarter of 2026, management expects revenues in the range of $945 million and $975 million and a gross profit margin in the range of 24.0% +/- 50 basis points. Conference CallA conference call to discuss Vishay’s second quarter financial results is scheduled for Wednesday, August 5, 2026, at 9:00 a.m. ET. To participate in the live conference call, please pre-register here. Upon registering, you will be emailed a dial-in number, and unique PIN. A live audio webcast of the conference call and a PDF copy of the press release and the quarterly presentation will be accessible directly from the Investor Relations section of the Vishay website at http://ir.vishay.com. There will be a replay of the conference call available on the Investor Relations website approximately one hour following the call and will remain available for 30 days. About VishayVishay manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and healthcare markets. Serving customers worldwide, Vishay is The DNA of tech®. Vishay Intertechnology, Inc. is a Fortune 1,000 Company listed on the NYSE (VSH). More on Vishay at www.Vishay.com. This press release includes certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles ("GAAP"), including adjusted net earnings; adjusted earnings per share; adjusted net revenues; adjusted gross margin; adjusted operating margin; free cash; earnings before interest, taxes, depreciation and amortization ("EBITDA"); adjusted EBITDA; and adjusted EBITDA margin; which are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. These non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, adjusted net revenues, adjusted gross margin, adjusted operating margin, free cash, EBITDA, adjusted EBITDA, and adjusted EBITDA margin do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that such measures are meaningful to investors because they provide insight with respect to intrinsic operating results and financial trends of the Company. Although the terms "free cash" and "EBITDA" are not defined in GAAP, the measures are derived using various line items measured in accordance with GAAP.  Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding the Company's intrinsic operations.  Reconciling items to calculate adjusted net revenues, adjusted gross margin, adjusted operating margin, and adjusted EBITDA represent those same items used in computing adjusted net earnings, as relevant.  Furthermore, the presented calculation of adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishay's revolving credit facility.  These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in the Company’s financial statements presented in its annual report on Form 10-K and its quarterly reports presented on Forms 10-Q. Statements contained herein that relate to the Company's future performance, including forecasted revenues and margins, capacity expansion, multi-year customer demand, stockholder returns, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words and expressions such as “will,” “expect,” “going forward” or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; volatility in prices for metals and materials; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The DNA of tech® is a trademark of Vishay Intertechnology. Contact:Vishay Intertechnology, Inc.Peter HenriciExecutive Vice President, Corporate Development+1-610-644-1300

Vishay Intertechnology (VSH) came out with quarterly earnings of $0.19 per share, beating the Zacks Consensus Estimate of $0.15 per share. This compares to a loss of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +26.67%. A quarter ago, it was expected that this chipmaker would post earnings of $0.03 per share when it actually produced earnings of $0.05, delivering a surprise of +66.67%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Vishay, which belongs to the Zacks Semiconductor - Discretes industry, posted revenues of $888.58 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 0.54%. This compares to year-ago revenues of $762.25 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Vishay shares have added about 168.1% since the beginning of the year versus the S&P 500's gain of 13%. While Vishay has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Vishay was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.25 on $908.35 million in revenues for the coming quarter and $0.75 on $3.58 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Semiconductor - Discretes is currently in the top 45% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the broader Zacks Computer and Technology sector, Optimum Communications, Inc. (OPTU), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This company is expected to post quarterly loss of $0.17 per share in its upcoming report, which represents a year-over-year change of +19.1%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Optimum Communications, Inc.'s revenues are expected to be $2.03 billion, down 5.7% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Vishay Intertechnology, Inc. (VSH) : Free Stock Analysis Report Optimum Communications, Inc. (OPTU) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research