Post by LIMCHIP CO., LIMITED

onsemi just signed final agreements to divest two manufacturing facilities — one in the Philippines, one in Pennsylvania — as the latest execution of its Fab Right strategy. The transactions reveal a disciplined approach to portfolio optimization that more semiconductor companies should study. The Philippine fab in Tarlac goes to Greatek Electronics, a Taiwan-based OSAT. Deal closure is expected within 3 to 6 months, with a long-term supply agreement ensuring customer deliveries remain uninterrupted during the transition. The Pennsylvania Mountain Top facility will transfer to Silex Microsystems, a Swedish MEMS foundry, with a longer runway — closing targeted for January 2028 — giving onsemi time to relocate existing production lines to other internal sites. The second deal is valued at approximately $40 million. Together, these moves will cut roughly $35 million in annual fixed operating costs, with savings phasing in through 2027 and reaching full impact by 2028. Crucially, neither facility houses onsemi's strategic process technologies. According to the company, both fabs handle mature, standardized chip manufacturing — not the SiC power devices, advanced automotive chips, or intelligent sensing products that define the company's growth thesis. This is the essence of Fab Right: not exiting manufacturing, but concentrating capital and talent on the nodes and process technologies that actually differentiate the business. For the broader industry, it reinforces a pattern — analog and power semiconductor companies are increasingly separating commodity capacity from competitive advantage. The ones that do it well will emerge with structurally higher margins through the cycle.