What happened

Three months ago, shares of On Semiconductor (ON -5.09%) racked up double-digit gains after reporting a solid earnings beat relative to Wall Street expectations and, well ... "second verse, same as the first."

As of 1 p.m. EDT today, shares of this semiconductor stock are up 15.2% after the company delivered another earnings beat, for its fiscal Q3 2021. Instead of the $0.74-per-share profit and $1.71 billion in sales that Wall Street was expecting, this morning the company reported profits of $0.87 on sales of $1.74 billion.  

Glowing green arrow climbs up on a stock screen.

Image source: Getty Images.

So what

On Semiconductor set a record for quarterly revenue in Q3, up 32% year over year. When calculated according to generally accepted accounting principles (GAAP), however, earnings weren't quite as good as the $0.87 pro forma figure note above. Still, GAAP profits rose to nearly twice the company's $0.38 per share Q3 2020 GAAP profit. That was helped by strong gross profit margins, up 310 basis points year over year at 41.4%, and operating profit margins that did even better, rising 6 percentage points to 22.9% -- also a record.  

And CEO Hassane El-Khoury touched all the bases explaining how his company will keep growing in the future, saying it has "a rapidly expanding design-win funnel for disruptive applications [of its chips in] such as electric vehicles, ADAS, industrial automation, and alternative energy."

Now what

Looking ahead to Q4 2021, On Semiconductor is forecasting that revenue will grow as much as 27% in the year's final quarter, with sales ranging from $1.74 billion to $1.84 billion -- all numbers above the $1.72 billion in sales that Wall Street has predicted. Gross margins on that revenue also appear likely to widen, to a range of from 41.8% to 43.8%.

And on the bottom line, the company says it expects to earn between $0.67 and $0.78 per share, GAAP, and $0.89 to $1.01 per share pro forma -- you guessed it, all numbers that are well above estimates once again.