Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported August 5, 2026 · Beat 1 of last 5 quarters
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Vishay's results underscore the accelerating AI infrastructure buildout, with AI-related demand driving record bookings and customers placing orders beyond 52 weeks. The company's capacity expansion, including foundry ramps and the 12-inch fab, is positioned to capture incremental AI power and data center demand, supporting the broader AI infrastructure supply chain.
Vishay reported adjusted revenue of $919M, up 9.5% sequentially and 20.5% year-over-year, with volume up 7% and ASPs up 2%. Book-to-bill was 1.32, and backlog grew 18% to $1.9B (6.1 months). All end markets, channels, and regions grew, with industrial up 30.1% YoY and distribution up 24.2% YoY. Adjusted gross margin expanded to 22.6%, and adjusted EPS was $0.19, up from $0.05 in Q1. The company completed a public stock offering of 17.25 million shares, raising $830M net, and ended the quarter with $1.3B in cash.
Management guided Q3 2026 revenue to $945M–$975M (midpoint +21.4% YoY, +4.5% QoQ) and gross margin to 24.0% ±50bps, one quarter ahead of their prior goal of exiting the year at 24%. They reiterated full-year 2026 CapEx of $400M–$440M, with about half going to the 12-inch fab in Germany, and expect negative free cash flow for the year. The 12-inch fab is on track to start non-automotive production in mid-2027, and foundry capacity additions in Korea and China are ramping in H2 2026 to support AI demand. Management emphasized continued price increases (about 1/3 of part numbers announced), a disciplined push toward the 30% gross margin target, and a focus on channel/mix management to drive margin expansion. They also noted they will use the equity raise proceeds to accelerate growth investments, including M&A and R&D, and expect capital intensity to decline from current levels.
“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.”
on AI demand and order visibility
“We are no longer simply supporting specific large OEM accounts by taking orders to maximize factory utilization.”
on Vishay 3.0 strategy
“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.”
on Gross margin guidance
Can you talk about the use of foundries, utilization, and expectations for Newport and the German fab?
Joel said foundries in Korea and China are ramping in Q3 to support AI wafer demand. Newport fab is completing automotive audits (9 of 10 done) and expects more program approvals monthly, which will free up capacity at Itzehoe 8-inch. The 12-inch fab in Germany is on track for non-automotive production in mid-2027; wafer counts not yet disclosed.
How should we think about gross margin trajectory and the potential for double ordering?
Joel said gross margin will benefit from volume, ASPs, channel management, cost savings, Newport utilization, and the 12-inch fab. He noted the 30% target remains for 2028. On double ordering, he said ordering is still rational, with POS growing and distribution inventory declining, but they are monitoring metrics closely.
Are you seeing pull-forward related to price increases, and is there margin impact from expanding distribution portfolio?
Joel said price increases are being implemented quickly and updated in backlog, making it hard for customers to pull ahead. On distribution expansion, the cost is negligible and benefits from distributor FAEs driving design registrations.