| Item 2.05. | Costs Associated with Exit or Disposal Activities |
On February 24, 2025, ON Semiconductor Corporation (the “Company” and, together with its subsidiaries, “onsemi”) initiated a company-wide restructuring plan that will impact all business groups including the worldwide manufacturing organization (the “Restructuring Plan”). This Restructuring Plan, as approved by management, consists of cost reduction initiatives designed to align onsemi’s spending with current business trends while enabling the Company to continue to make progress towards its long-term financial operating model.
Under the Restructuring Plan, onsemi intends to reduce its global workforce by approximately 2,400 employees. onsemi expects this reduction in force to be completed during 2025, subject to applicable local law and regulations. The Company estimates that it will incur between $50 million and $60 million in employment-related charges for, among other things, one-time cash payments for severance, benefits expenses, payroll taxes and other ancillary charges. onsemi expects that the majority of these charges will be recorded during calendar year 2025. The Company estimates that these reductions, once completed, will generate savings of $105 million to $115 million on an annualized basis.
The estimates of both savings and charges provided in this Item 2.05 are subject to a number of assumptions and actual results may differ materially from these estimates. In addition, onsemi may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the Restructuring Plan.
Forward-Looking Statements
This Current Report on Form 8-K includes “forward-looking statements,” as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain statements, other than statements of historical facts, included in this document could be deemed forward-looking statements. Forward-looking statements are often characterized by words such as “believes,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “anticipates,” “should” or similar expressions or by discussions of strategy, plans or intentions. These forward-looking statements relate to a variety of matters including, without limitation, statements regarding the objectives, nature, execution, and timing of the Company’s Restructuring Plan and estimates and projections of expected benefits, savings, costs, expenses, charges and cash expenditures relating to the Restructuring Plan. All forward-looking statements in this document are made based on our current expectations, forecasts, estimates and assumptions and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information, which speaks only as of the date made, except as may be required by law. Investing in our securities involves a high degree of risk and uncertainty, and you should carefully consider the trends, risks and uncertainties described in this document, our 2024 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 10, 2025 and other reports filed with or furnished to the SEC before making any investment decision with respect to our securities. If any of these trends, risks or uncertainties actually occurs or continues, our business, financial condition or operating results could be materially adversely affected, the trading prices of our securities could decline, and you could lose all or part of your investment. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.
