Breaking Down Vishay Intertechnology, Inc. (VSH) Financial Health: Key Insights for Investors

You're looking at Vishay Intertechnology, Inc. (VSH) because you see the long-term tailwinds in discrete semiconductors and passive components-things like smart grid infrastructure and AI-related power requirements are defintely driving demand-but the near-term financials are giving you pause. Honestly, you should be cautious but not panicked. The company just reported Q3 2025 revenue of $790.6 million, beating analyst estimates, which is a solid signal of operational execution in a tough environment. But here's the quick math on the risk: Q3 also showed a GAAP loss per share of $(0.06) and, more critically, free cash flow was negative $24.33 million, continuing a trend that shows capital expenditure is still heavy. This mix of strong top-line alignment with high-growth markets, plus a book-to-bill ratio of 0.97 suggesting a slight slowdown in new orders versus shipments, means you need to look past the headline revenue beat to understand the working capital pressure and the path to their projected full-year 2025 revenue of $3,058.1 million.

Revenue Analysis

You want the quick takeaway on Vishay Intertechnology, Inc. (VSH)'s revenue: the company delivered a solid beat in the third quarter of 2025, pulling in $790.6 million in revenue, which was a 7.5% year-over-year increase. This growth is defintely a positive signal, showing VSH is successfully aligning its discrete semiconductors and passive electronic components with high-demand, structural growth markets.

Primary Revenue Streams and Growth Drivers

Vishay Intertechnology, Inc.'s revenue is fundamentally split between two core product groups: Semiconductors (like MOSFETs, Diodes, and Optoelectronic Components) and Passive Components (Resistors, Inductors, and Capacitors). Looking at the trailing twelve months (TTM) ending September 27, 2025, the Passive Components segment accounts for the larger share, but both are critical.

Here's the quick math on the TTM revenue breakdown of $2.98 billion:

• Passive Components (Resistors, Inductors, Capacitors): Approximately 53.4% of revenue.
• Semiconductors (MOSFETs, Diodes, Optoelectronics): Approximately 46.7% of revenue.

The Q3 2025 growth was not just broad-based; it was strategic. The CEO pointed directly to alignment with key sectors as the primary driver. You need to focus on where the money is coming from to project future performance.

• Smart grid infrastructure.
• AI-related power requirements.
• Automotive and aerospace/defense.

Geographic and Segment Contribution

The geographic mix tells an interesting story about where VSH is finding its immediate opportunities. Asia is the clear growth engine right now, driving a higher percentage of the total revenue compared to the prior year. This regional shift highlights the success of their strategy to capture demand from the booming Asian manufacturing and technology sectors.

To see how the specific components contribute to that TTM revenue of $2.98 billion, here is the granular data you need:

Near-Term Revenue Outlook and Risks

Management's forward-looking guidance for Q4 2025 projects revenue to be around $790 million ($\pm$ $20 million). This suggests a stable, sequential performance following the Q3 beat. However, you should note the book-to-bill ratio-a key indicator of near-term sales-was 0.97 for Q3 2025, with Semiconductors slightly lower at 0.96 and Passives at 0.98. A ratio below 1.0 means that new orders are coming in slower than the rate of shipments (revenue), which can signal a mild deceleration in the near term. This isn't a panic button, but it's a realistic check on the momentum.

What this estimate hides is the continued drag from the Newport operations, which is expected to negatively impact gross margin by 150 to 175 basis points in Q4 2025. This is a cost-side headwind that eats into the profitability of the strong top-line revenue. For a deeper dive into the company's long-term strategic focus, you should review the Mission Statement, Vision, & Core Values of Vishay Intertechnology, Inc. (VSH).

Profitability Metrics

You're looking for a clear picture of how efficiently Vishay Intertechnology, Inc. (VSH) is turning revenue into profit in 2025, and honestly, the numbers show a business grappling with heavy integration costs and market headwinds. The direct takeaway is that while the Gross Margin is stable, the company is still running near breakeven on an operating basis, and GAAP net profitability remains a challenge.

For the third quarter of 2025, Vishay Intertechnology, Inc. reported revenues of $790.6 million. This top-line figure is steady, but the margins tell the real story of operational efficiency. Here's the quick math on the key profitability margins:

• Gross Profit Margin: 19.5% (Gross Profit was approximately $153.9 million).
• Operating Profit Margin: 2.4% (Operating Income was approximately $19.1 million).
• Net Profit Margin: -1.0% (resulting in a GAAP Net Loss of approximately $7.9 million).

The gross margin is defintely the anchor. It's consistent but low, and that's the first risk you need to map out.

Operational Efficiency and Cost Management

The trend in profitability over 2025 shows stability at a lower-than-ideal level, which is a sign of cost pressures being managed, but not yet overcome. The Gross Margin has held tight, moving from 19.0% in Q1 2025 to 19.5% in Q2 and Q3 2025. This stability is notable because the company has been absorbing a significant headwind-the integration costs related to the Newport acquisition-which management estimates is a 150 to 175 basis point drag on the gross margin.

The real squeeze is below the gross profit line. The Operating Margin of 2.4% in Q3 2025 is thin. For context, the Q2 2025 Operating Margin of 2.9% included an $11.3 million benefit from a favorable contingency resolution, meaning core operational efficiency is extremely tight. When you factor in interest expense and other non-operating items, the GAAP Net Profit Margin slides into a negative -1.0%, resulting in a net loss. This shows that selling, general, and administrative (SG&A) expenses are eating up nearly all the gross profit, leaving little room for error or non-recurring costs.

Benchmarking Against Industry Averages

When you compare Vishay Intertechnology, Inc.'s profitability to the broader electronic components industry, the gap highlights the challenge. The company operates in both the active (semiconductors) and passive components markets, but its overall margins fall well short of the industry averages, especially for passive components, which is a core business. You can see the disparity clearly in the table below.

What this comparison tells us is that Vishay Intertechnology, Inc. is operating at a significant discount to the average gross profitability of its peers, particularly in the passive components segment where the average is 30%. The company's Gross Margin of 19.5% is a full 10.5 percentage points lower than the passive industry average, suggesting a major structural or cost-of-goods issue that goes beyond temporary market softness. The company's strategic focus, including its Mission Statement, Vision, & Core Values of Vishay Intertechnology, Inc. (VSH), is clearly aimed at high-growth markets, but the financial results show the cost of that transition is still weighing heavily on the bottom line. The near-zero Operating Margin is a red flag that operational execution must improve dramatically to achieve sustainable, positive net income.

Debt vs. Equity Structure

You want to know how Vishay Intertechnology, Inc. (VSH) is financing its growth, and that takes us right into the heart of its balance sheet: the debt-to-equity ratio (D/E). This ratio is your quick measure of financial leverage, showing how much of the company's operations are funded by debt versus shareholder capital. Simply put, it tells you who has the biggest claim on the assets.

As of the third quarter of fiscal year 2025, Vishay Intertechnology's debt-to-equity ratio stood at 0.44. Here's the quick math: with total debt at around $1.042 billion and total equity at approximately $2.08 billion, the company is using less than a dollar of debt for every dollar of shareholder equity.

This is a healthy, conservative position, especially when you compare it to the industry. The average D/E ratio for the Semiconductors industry is around 0.4058, and for the broader Electronic Components and Accessories sector, the median is closer to 0.68. Vishay Intertechnology is running a capital structure right in line with its peers, maybe just slightly more debt-reliant than the purest semiconductor average, but still well below the one-to-one risk threshold.

Balancing Debt and Equity for Expansion

The debt structure isn't static; it's actively managed. The company's management is clearly comfortable using debt to fund its aggressive 'Vishay 3.0' capacity expansion, which is a massive capital expenditure (CapEx) program. This expansion is why you see a negative free cash flow of $24.3 million in Q3 FY2025. They are spending money to grow, and that spending is currently being financed through a mix of cash and debt.

For the near-term, this strategy means they are drawing on their revolving credit facilities, with $189 million outstanding on the revolver as of the last quarter. This is short-term debt funding long-term strategic goals, which is a risk you need to monitor. Honestly, negative free cash flow for a full year is a strain, but it's a calculated one to support future growth.

In terms of recent refinancing, Vishay Intertechnology has been proactive. They issued $650 million of 2.25% Convertible Senior Notes due in 2030 back in 2023. A key part of that move was to repurchase a portion of the older convertible senior notes that were due in 2025. This effectively pushed out a major debt maturity, reducing refinancing risk and securing capital at a very attractive 2.25% rate for the next five years. That's smart treasury work.

The current financing mix shows a company prioritizing strategic investment over pure debt reduction, which aligns with their Mission Statement, Vision, & Core Values of Vishay Intertechnology, Inc. (VSH). The key takeaway here is that while the debt load is manageable, the ongoing negative cash flow means they will defintely continue to rely on their credit lines to fund the capacity buildout, a trend we expect to see through the end of fiscal 2025.

• Monitor the revolver balance for any significant spikes.
• Watch for a return to positive free cash flow in 2026.

Liquidity and Solvency

Vishay Intertechnology, Inc. (VSH) maintains a strong liquidity position as of the end of the third quarter of 2025, primarily driven by a healthy buffer of current assets over short-term debt obligations. This is a crucial indicator that the company can comfortably meet its near-term financial commitments.

The core liquidity metrics confirm this strength. The company's Current Ratio, which measures current assets against current liabilities, stands at a solid 2.70. This means that for every dollar of short-term debt, Vishay Intertechnology, Inc. has $2.70 in assets that can be converted to cash within a year. Even when we strip out inventory-which can be slow to liquidate in the semiconductor space-the Quick Ratio (Acid-Test Ratio) is still a robust 1.64. A ratio above 1.0 is defintely a green flag for immediate solvency.

Analyzing the working capital trends shows a slight, but manageable, contraction. At the end of the second fiscal quarter of 2025 (June 28, 2025), Vishay Intertechnology, Inc.'s total current assets were $1,912,082 thousand, against total current liabilities of $707,294 thousand. This results in net working capital of approximately $1,204,788 thousand. This figure is essentially flat compared to the end of 2024, indicating stable short-term operational funding, but not a significant build-up of cash or receivables.

The cash flow statement overview for 2025 reveals a mixed, but improving, picture. Cash flow from operating activities for the third quarter of 2025 was a positive $28 million. However, the company is in an aggressive capital expenditure (CapEx) cycle, deploying cash for capacity expansion projects. This is the main reason why the Free Cash Flow (FCF) remains negative, though it is improving.

• Operating Cash Flow (Q3 2025): $28 million
• Investing Cash Flow (CapEx, Q3 2025): $52 million
• Free Cash Flow (Q3 2025): negative $24 million

Here's the quick math: Operating Cash Flow minus CapEx gives us the FCF of negative $24 million. While negative FCF is a concern, it's a strategic choice right now, as the majority of the CapEx ($43 million of the $52 million total) is designated for capacity expansion to prepare for the anticipated market upturn. This is an investment in future revenue, not a sign of operational distress. Financing cash flow saw a $13.6 million quarterly dividend payment to stockholders in Q3 2025. The liquidity strength is a key factor to consider as you dive deeper into the company's strategic direction. Exploring Vishay Intertechnology, Inc. (VSH) Investor Profile: Who's Buying and Why?

Valuation Analysis

You're looking at Vishay Intertechnology, Inc. (VSH) and asking the core question: is the stock priced fairly, or is there a disconnect? As of late 2025, the market is giving us mixed signals, which often points to a company in a transition phase. The direct takeaway is that while the stock has been punished over the last year, its valuation multiples suggest it may be undervalued relative to its assets and cash flow potential, but the negative trailing earnings introduce a clear risk.

The stock has seen a rough ride, dropping by about -17.53% over the last 52 weeks, trading near the lower end of its range of $10.35 to $20.15. The current stock price is around $12.50. This price action reflects a challenging semiconductor cycle, but it also creates an opportunity if you believe in a near-term recovery. That's the simple truth of a cyclical business.

• Price-to-Book (P/B): At a P/B ratio of just 0.81, the stock is trading for less than the value of its net assets on the balance sheet. This is a classic indicator of potential undervaluation, suggesting the market is not fully pricing in the company's tangible assets.
• Enterprise Value-to-EBITDA (EV/EBITDA): The EV/EBITDA ratio stands at 8.58. For a mature industrial tech company, this is a reasonable, often conservative, multiple, especially when compared to high-growth peers that might trade well into the teens.
• Price-to-Earnings (P/E): The trailing twelve-month (TTM) P/E is negative due to recent losses, which is why you see 'n/a' or a negative number like -23.61. This is a red flag, but it's a backward-looking one. Analysts forecast a forward P/E of approximately 24.29 based on expected future earnings, which is a bit high, but the expected turnaround for 2026 brings that down to a more attractive 15.72.

Here's the quick math on the dividend: Vishay Intertechnology, Inc. pays an annual dividend of $0.40 per share, which translates to a solid dividend yield of approximately 3.38%. What this estimate hides is the current TTM payout ratio being negative due to the losses, but the good news is that analysts expect the future payout ratio to be a sustainable 24.0% of earnings, meaning the dividend is defintely covered going forward.

Wall Street's consensus is cautious, with the average analyst rating being a 'Hold' or 'Reduce'. Still, the average 12-month price target is a robust $19.00, implying a potential upside of over 51.82% from the current price. This gap between the current price and the target suggests that while analysts are hesitant to issue a 'Buy' now due to near-term headwinds, they see significant long-term value once the semiconductor inventory correction passes. For a deeper dive into the operational risks and opportunities, you should check out the full post on Breaking Down Vishay Intertechnology, Inc. (VSH) Financial Health: Key Insights for Investors.

The action item here is clear: if you are a patient investor, the low P/B and EV/EBITDA, coupled with the high analyst price target, suggest a margin of safety. If you are focused on immediate earnings, the negative TTM P/E means you should wait for a clearer signal of the earnings turnaround. Finance: Track quarterly EPS revisions closely.

Risk Factors

You're looking at Vishay Intertechnology, Inc. (VSH) because of its alignment with secular growth in e-mobility and AI, but we need to talk about the near-term headwinds that are pressuring the financials. The company is in a heavy investment phase, and that creates real, measurable risk right now. Simply put, VSH is spending heavily to secure future growth, but that spending is draining cash and compressing margins in the present.

The most immediate operational risk is the integration of the Newport wafer fab acquisition. Here's the quick math: management guided that the Newport operations would negatively impact the gross profit margin by approximately 150 to 175 basis points in their Q4 2025 outlook. That's a significant drag on profitability, even as the company targets Q4 2025 revenues in the range of $790 million ± $20 million. They are working to make Newport margin neutral by the end of Q1 2026, but until then, it's a clear headwind.

Financial flexibility is also under pressure from aggressive capital spending. Vishay Intertechnology is executing a multi-year, strategic capacity expansion, planning to invest between $300 million to $350 million in capital expenditures during the 2025 fiscal year alone. This heavy cash outflow has led management to guide for ongoing negative free cash flow, which could necessitate increased debt reliance if the market upturn is defintely delayed. You need to monitor the balance sheet closely here.

External and market conditions add another layer of complexity. The semiconductor industry is notoriously cyclical, and while VSH is aligned with high-growth markets, the Q3 2025 book-to-bill ratio of 0.97 (with semiconductors at 0.96 and passive components at 0.98) is a clear warning sign. A ratio below 1.0 means orders are being filled faster than new ones are coming in, signaling potential revenue challenges in the immediate future. Also, the external risks include:

• Macroeconomic Volatility: Softening demand in key end markets like automotive and industrial.
• Trade and Tariff Changes: Uncertainty around U.S. and foreign trade regulations and tariffs, which have already been cited as reducing gross margins by an estimated 30 basis points in Q2 2025.
• Competition: The constant threat of technological changes and competition, especially for legacy products, which risks delaying the returns on their heavy capital investments in new technologies like Silicon Carbide (SiC).

To be fair, Vishay Intertechnology has clear mitigation strategies laid out in its Vishay 3.0 plan. They are proactively managing costs through restructuring actions, including facility closures, and focusing their substantial capital on high-growth areas like SiC components for e-mobility and power solutions for AI servers. Their diversified product portfolio and global manufacturing footprint also provide a buffer against regional or sector-specific downturns. The company has a strong liquidity position, with $609 million in cash reserves reported in 2024, which helps them finance the current investment phase. You can read more about the investment case in Breaking Down Vishay Intertechnology, Inc. (VSH) Financial Health: Key Insights for Investors.

Growth Opportunities

You're looking at Vishay Intertechnology, Inc. (VSH) at a pivotal moment. The direct takeaway is that while 2025 has been a transitional year with margin pressure, the company's heavy investment in capacity and its focus on high-growth end-markets-like AI and electric vehicles-are setting the stage for a significant earnings rebound in 2026.

The company is intentionally positioning itself for the next up-cycle. Here's the quick math: the consensus revenue estimate for the full fiscal year 2025 is around $3.04 billion, which is modest, but the real story is the expected earnings growth. Analysts project earnings per share (EPS) to jump from an estimated $0.53 in 2025 to a strong $1.67 in 2026, representing a massive 215.09% increase. That's a clear signal that the investment cycle is expected to pay off.

Key Growth Drivers: The Tech Megatrends

Vishay Intertechnology's growth isn't about broad market recovery alone; it's about winning in specific, high-value segments. The Q3 2025 results, which posted revenue of $791 million, showed sequential strength in the areas where the company has concentrated its capital expenditures (CapEx), which are projected to hit between $300 million and $350 million for the full year 2025. This money is going to capacity expansion for next-generation products.

The core growth drivers are clear and concrete:

• Automotive Electrification: Revenue from the automotive segment increased 7% sequentially in Q3 2025, driven by higher electronic content in hybrid and battery electric vehicle (BEV) powertrains, ADAS (Advanced Driver-Assistance Systems), and smart cockpit applications.
• AI and Data Centers: Significant demand for AI servers and server power is driving sales of their discrete semiconductors and passive components. They are actively supplying components for AI chip production sites and next-generation data centers.
• Smart Grid Infrastructure: They are winning large orders for high-voltage DC power transmission capacitors in Europe, Asia, and India, with delivery scheduled for 2025. This is a defintely strong early indicator for the industrial business.
• Aerospace and Defense: Recent product launches, like the SGTPL-28 series planar transformers for 28V input converters, are opening new, high-margin opportunities in this specialized sector.

Strategic Focus and Competitive Edge

The company's long-term strategy, known as Vishay 3.0, is the framework for this growth. The plan targets a long-term revenue growth rate of 9-11% Compound Annual Growth Rate (CAGR) from its 2023 base by 2028. This isn't just a goal; it's being executed through a focus on innovation and manufacturing flexibility.

Their competitive advantage rests on two pillars. First, it's their broad portfolio, which allows them to cross-sell multiple technologies-MOSFETs, ICs, diodes, capacitors, inductors, and resistors-to a single customer, increasing their overall part count per design. Second, it's their investment in advanced technology like Silicon Carbide (SiC) diodes, with Gen 4 1,200V and 650V products already released. This positions them well against competitors as the industry shifts to higher-efficiency power solutions.

What this estimate hides, however, is the persistent margin pressure from the Newport operations and the conservative Q4 2025 revenue guidance of approximately $790 million. Still, the book-to-bill ratio has shown positive signs, indicating that demand is building in the backlog.

For a deeper dive into who is buying into this strategy, you should check out Exploring Vishay Intertechnology, Inc. (VSH) Investor Profile: Who's Buying and Why?