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Cover and table of contents

10-K 1 d332046d10k.htm FORM 10-K

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2016

Or

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

(Commission File Number) 000-30419

ON SEMICONDUCTOR CORPORATION

(Exact name of registrant as specified in its charter)

Delaware36-3840979
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

5005 E. McDowell Road

Phoenix, AZ 85008

(602) 244-6600

(Address, zip code and telephone number, including area code, of principal executive offices)

Securities Registered Pursuant to Section 12(b) of the Act:
Title of Each ClassName of Each Exchange on Which Registered
Common Stock, par value $0.01 per shareThe NASDAQ Stock Market LLC
(NASDAQ Global Select Market)

Securities Registered Pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒Accelerated filer ☐
Non-accelerated filer ☐(Do not check if a smaller reporting company)Smaller reporting company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was $3,601,740,218 as of July 3, 2016, based on the closing sales price of such stock on the NASDAQ Global Select Market. Shares held by executive officers, directors and persons owning directly or indirectly more than 10% of the outstanding common stock (as applicable) have been excluded from the preceding number because such persons may be deemed to be affiliates of the registrant.

The number of shares of the registrant’s common stock outstanding at February 17, 2017 was 419,610,858.

Documents Incorporated by Reference

Portions of the registrant’s Definitive Proxy Statement relating to its 2017 Annual Meeting of Stockholders, which is expected to be filed pursuant to Regulation 14A within 120 days after the registrant’s fiscal year ended December 31, 2016, are incorporated by reference into Part III of this Form 10-K.

Table of Contents

ON SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

FORM 10-K

TABLE OF CONTENTS

Part I
Item 1.Business5
Business Overview5
Products and Technology7
Customers10
End-Markets for Our Products11
Manufacturing Operations12
Raw Materials14
Sales, Marketing and Distribution14
Patents, Trademarks, Copyrights and Other Intellectual Property Rights14
Seasonality14
Backlog and Inventory15
Competition15
Research and Development17
Government Regulation17
Employees18
Executive Officers of the Registrant19
Geographical Information21
Available Information22
Item 1A.Risk Factors22
Item 1B.Unresolved Staff Comments44
Item 2.Properties44
Item 3.Legal Proceedings45
Item 4.Mine Safety Disclosures45
Part II
Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities46
Item 6.Selected Financial Data46
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations47
Item 7A.Quantitative and Qualitative Disclosures about Market Risk72
Item 8.Financial Statements and Supplementary Data73
Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure73
Item 9A.Controls and Procedures74
Item 9B.Other Information75
Part III
Item 10.Directors, Executive Officers and Corporate Governance76
Item 11.Executive Compensation76
Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters76
Item 13.Certain Relationships and Related Transactions, and Director Independence78
Item 14.Principal Accountant Fees and Services78
Part IV
Item 15.Exhibits and Financial Statement Schedules79
Item 16.Form 10-K Summary90
Signatures91

(See the glossary immediately following this table of contents for definitions of certain abbreviated terms)

Table of Contents

ON SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

FORM 10-K

GLOSSARY OF SELECTED ABBREVIATED TERMS*

Abbreviated TermDefined Term
1.00% Notes1.00% Convertible Senior Notes due 2020
1.875% Notes1.875% Convertible Senior Subordinated Notes due 2025
2.625% Notes2.625% Convertible Senior Subordinated Notes due 2026
2.625% Notes, Series B2.625% Convertible Senior Subordinated Notes due 2026, Series B
ADASAdvanced driver assistance systems
AECAutomotive Electronics Council
AFSAdaptive front lighting systems
AptinaAptina, Inc.
Amended and Restated SIPON Semiconductor Corporation Amended and Restated Stock Incentive Plan
AMISAMIS Holdings, Inc.
AR/VRAugmented Reality/Virtual Reality
ASCAccounting Standards Codification
ASICApplication specific integrated circuits
ASSPApplication specific standard product
ASUAccounting Standards Update
AXSEMAXSEM A.G.
CatalystCatalyst Semiconductor, Inc.
CCDCharge-coupled device
CMDCalifornia Micro Devices Corporation
CMOSComplementary metal oxide semiconductor
CSPChip scale package
DFNDual-flat no-leads
DSPDigital signal processor
ECLEmitter coupled logic
EEElectrically erasable
EEPROMElectrically erasable programmable read-only memory
eFuseProprietary IBM technology
ERISAEmployee Retirement Income Security Act
ESDElectrostatic discharge
ESPPON Semiconductor Corporation 2000 Employee Stock Purchase Plan
EV/HEVElectric Vehicles/Hybrid Electric Vehicles
Exchange ActSecurities Exchange Act of 1934, as amended
FairchildFairchild Semiconductor International Inc.
FASBFinancial Accounting Standards Board
FDAU.S. Food and Drug Administration
FreescaleFreescale Semiconductor, Inc.
FS IGBTField stop insulated-gate bipolar transistor
GaNGallium nitride
HDHyper Device
HE FETsHigh efficiency MOSFETs
HVHigh voltage
HV FETSHigh voltage MOSFETs
Table of Contents
Abbreviated TermDefined Term
ICIntegrated circuit
IGBTInsulated-gate bipolar transistor
IoTInternet-of-Things
IPIntellectual property
IPDIntegrated passive devices
IPRDIn-process research and development
IPMIntelligent power module
IRInfrared
KSSBack-end manufacturing facility in Hanyu, Japan
LDOsLow drop out regulator controllers
LEDLight-emitting diode
LIBO RateLondon Interbank Offered Rate
LSILarge scale integration
MOSFETMetal oxide semiconductor field effect transistor
MotorolaMotorola Inc.
OEMOriginal equipment manufacturers
OPAmpsOperational amplifiers
PCPersonal computer
PIMsPower integrated modules
PSRRPower supply rejection ratio
RFRadio frequency
RSURestricted Stock Unit
SANYO ElectricSANYO Electric Co., Ltd.
SANYO SemiconductorSANYO Semiconductor Co., Ltd.
SCI LLCSemiconductor Components Industries, LLC
SECSecurities and Exchange Commission
Securities ActSecurities Act of 1933, as amended
SMBCSumitomo Mitsui Banking Corporation
SoCSystem on chip
TMOST-metal oxide semiconductor
TruesenseTruesense Imaging, Inc.
UPSUninterruptible power supplies
VCORECore voltage
VREGVoltage regulator
WSTSWorld Semiconductor Trade Statistics
  • Terms used, but not defined, within the body of the Form 10-K are defined in this Glossary.
Table of Contents

PART I

Next: Item 1. Business