Onsemi beats fourth-quarter estimates on strong chip demand

(Reuters) - Chipmaker Onsemi beat Wall Street estimates for fourth-quarter revenue and profit on Monday, helped by resilient demand for its silicon carbide chips, sending the company's shares up around 9% in early trade.

The upbeat results indicate that demand for the company's silicon carbide chips has held up well despite subdued consumer spending caused by high interest rates.

Onsemi supplies chips that go intro drive trains of electric cars and help with driver-assistance systems like cameras and sensors.

The company, however, forecast first-quarter revenue and profit below analysts' expectations, raising concerns about the outlook of the EV market after warnings of softening growth from other automotive chipmakers and Tesla chief executive Elon Musk.

Last month, chipmakers and Onsemi's peers, Texas Instruments and Wolfspeed also issued gloomy forecasts, citing signs of spending weakness and fears about a supply glut in automotive markets.

The company, whose clients include European automaker Volkswagen, reported fourth-quarter revenue of $2.02 billion, beating an estimate of $2 billion, according to LSEG data.

On an adjusted basis, Onsemi earned $1.25 per share compared with an estimate of a profit of $1.21 per share.

The company projects first-quarter revenue in a range of $1.80 billion to $1.90 billion, compared with an estimate of $1.92 billion.

It expects adjusted diluted earnings per share of 98 cents to $1.10, the midpoint of which is below analysts' expectation of $1.10 per share.

(Reporting by Zaheer Kachwala in Bengaluru; Editing by Ravi Prakash Kumar)