Tower Semiconductor Ltd.
- Open
- 252.55
- Day high
- 263.50
- Day low
- 249.72
- Prev close
- 255.59
- Volume
- 1.2M
- Mkt cap
- $29.4B
- P/E (TTM)
- 119.6
- EPS (TTM)
- $2.18
- P/B
- 9.9
- P/S
- 18.1
- Yield
- —
- Per share
- —
Tower Semiconductor Ltd. (TSEM) is a Technology company listed on NASDAQ. The stock is up 514% over the past year. Drillr has 1 published research article covering TSEM.
Tower Semiconductor Ltd. (TSEM) financials & analyst ratings
Fundamentals (TTM)
Analyst consensus · 3 analysts
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
TSEM earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 13, 2026 | $0.56 | $0.65 | +16.1% | $414M | +0.7% |
| Feb 11, 2026 | $0.67 | $0.78 | +16.4% | $440M | +7.1% |
| May 14, 2025 | $0.38 | $0.45 | +18.8% | $358M | +0.0% |
| Nov 13, 2024 | $0.53 | $0.57 | +7.5% | $371M | +0.1% |
| Jul 24, 2024 | $0.45 | $0.53 | +17.8% | $351M | -5.0% |
| May 9, 2024 | $0.39 | $0.46 | +17.9% | $327M | +0.8% |
| Feb 14, 2024 | $0.52 | $0.55 | +5.8% | $352M | +0.5% |
| Nov 13, 2023 | $0.51 | $0.54 | +5.9% | $358M | -0.3% |
| Jul 26, 2023 | $0.49 | $0.45 | -8.2% | $357M | -0.5% |
| May 15, 2023 | $0.49 | $0.41 | -16.3% | $356M | +0.9% |
| Feb 16, 2023 | $0.57 | $0.69 | +21.1% | $403M | +0.6% |
| Nov 14, 2022 | $0.61 | $0.73 | +19.7% | $427M | -0.1% |
Tower Semiconductor Ltd. company profile
Overview
Tower Semiconductor Ltd. (NASDAQ:TSEM) is an Israeli independent semiconductor foundry company founded in 1993 and publicly traded since 1994. Headquartered in Migdal Haemek, Israel, Tower operates as a contract manufacturer specializing in analog-intensive mixed-signal semiconductor devices. The company has established itself as a significant player in the foundry industry, serving customers across multiple technology segments including communications, automotive, industrial, and consumer electronics markets through its global network of fabrication facilities.
Business
Tower Semiconductor operates as an independent semiconductor foundry, which means it manufactures semiconductor chips designed by other companies rather than creating its own chip designs. The semiconductor foundry industry serves as the manufacturing backbone for "fabless" semiconductor companies and integrated device manufacturers who prefer to outsource production rather than build their own expensive fabrication facilities. The company's core business revolves around several specialized technology platforms and manufacturing processes: 1. RF (Radio Frequency) Technologies - Representing approximately 46% of total revenue through two main segments: RF Mobile (29% of revenue) focuses on smartphone and mobile device components, while RF Infrastructure (17% of revenue) serves data center, cloud computing, and telecommunications infrastructure markets. 2. Power Management and Discrete Components - Accounting for roughly 36% of revenue, this segment produces power management integrated circuits and discrete semiconductor components used in various electronic devices to regulate and control electrical power. 3. Sensor and Display Technologies - Contributing about 15% of revenue, this segment manufactures CMOS image sensors for cameras and display driver chips for various screen technologies. 4. Mixed Signal and CMOS - Representing 7% of revenue, this segment produces chips that process both analog and digital signals, commonly used in industrial and automotive applications. The company also offers specialized process technologies including Silicon Germanium (SiGe), Silicon Photonics for high-speed data transmission, BiCMOS for mixed analog-digital applications, and MEMS (Micro-Electro-Mechanical Systems) for sensor applications. Tower operates multiple fabrication facilities globally, processing wafers in various sizes including 6-inch, 8-inch, and advanced 12-inch (300mm) formats.
Revenue model
Tower Semiconductor generates revenue primarily through contract manufacturing services, where customers pay for wafer fabrication based on the number of wafers processed and the complexity of the manufacturing process. The company's business model is asset-intensive, requiring significant capital investments in fabrication facilities and advanced manufacturing equipment. The company's revenue streams include wafer fabrication services charged per wafer processed, with pricing varying significantly based on technology complexity and process node requirements. Higher-margin specialty processes like Silicon Photonics and Silicon Germanium command premium pricing compared to standard CMOS manufacturing. Additionally, Tower provides design enablement services and process development support, generating additional service fees from customers. Customer segments include fabless semiconductor companies, integrated device manufacturers, and original equipment manufacturers across industries such as consumer electronics, automotive, telecommunications, industrial automation, and aerospace/defense. The company's diverse customer base helps mitigate concentration risk, though it remains exposed to cyclical semiconductor industry dynamics. Several factors influence Tower's profitability margins. Positive margin drivers include capacity utilization rates at fabrication facilities, product mix shift toward higher-margin specialty technologies like Silicon Photonics, successful yield improvements in manufacturing processes, and favorable pricing for advanced technology nodes. The company benefits from growing demand in AI-related applications, 5G infrastructure deployment, and increasing semiconductor content in automotive applications. Margin pressures come from semiconductor industry cyclicality, competitive pricing pressure from larger foundries, significant capital expenditure requirements for facility upgrades and new technology development, and the need to maintain multiple fabrication facilities with varying utilization rates. Currency fluctuations also impact margins given the company's global operations and customer base.
Competitive moat
Tower Semiconductor's competitive moat is moderate and primarily built around specialized technology capabilities rather than scale advantages. The company's strongest defensive position lies in its expertise in analog-intensive mixed-signal processes and specialty technologies like Silicon Photonics and Silicon Germanium, which require significant technical know-how and customer qualification time. Key moat elements include established customer relationships with lengthy qualification cycles that create switching costs, specialized process technologies that are difficult to replicate, and geographic diversification of manufacturing facilities providing supply chain resilience. The company's focus on analog and mixed-signal technologies positions it in markets where pure-play digital foundries have less expertise. However, Tower's moat faces significant challenges. The company competes against much larger foundries like Taiwan Semiconductor Manufacturing Company (TSMC) and GlobalFoundries, which possess superior scale economies and R&D resources. These larger competitors can invest more heavily in advanced technology development and offer more comprehensive manufacturing platforms. Additionally, the semiconductor foundry industry experiences ongoing consolidation pressure, and Tower lacks the scale to compete effectively in the highest-volume, most advanced digital processes. The company's relatively small size limits its ability to invest in cutting-edge manufacturing nodes, potentially making it vulnerable to technological disruption. While Tower has carved out profitable niches in specialty processes, these markets are smaller and may not provide sufficient growth opportunities long-term. The threat of customer backward integration or alternative sourcing arrangements also poses ongoing competitive risks.
Risks & safety
Tower Semiconductor demonstrates a strong financial position with substantial margin of safety across multiple metrics. • Liquidity and Solvency: Current ratio of 6.18x and quick ratio of 5.23x indicate excellent short-term liquidity. Cash and short-term investments of $272 million provide substantial operating flexibility. Debt-to-equity ratio of only 6.8% reflects minimal leverage risk. • Cash Generation: Operating cash flow of $449 million for fiscal 2024 demonstrates strong cash generation capability. Free cash flow of $13 million, while modest, reflects heavy capital investment period rather than cash burn concerns. • Valuation Metrics: Trading at 26x earnings and 10.8x EV/EBITDA suggests reasonable but not cheap valuation. Graham number of $16.27 compared to current price indicates potential overvaluation by traditional value metrics. • Other Considerations: Strong balance sheet with $2.6 billion in net assets provides substantial downside protection. However, capital-intensive nature of business requires ongoing investment, and cyclical industry exposure creates earnings volatility risk.
Recent development
Over the past few years, Tower Semiconductor has executed several strategic initiatives to position itself for growth in emerging technology markets. The company has made substantial investments totaling approximately $1.15 billion in expanding manufacturing capacity, including $500 million for a 12-inch fabrication facility in Agrate, Italy, $300 million in Intel's New Mexico facility, and $350 million for 5G and RF capacity expansion. Silicon Photonics has emerged as a key growth driver, with revenue growing from $30 million in 2023 to over $150 million run rate by Q4 2024. The company has developed capabilities for 800 Gbps products and begun production ramp of 1.6 Tbps products, positioning itself as a leading foundry in this high-growth market serving data center and AI infrastructure demands. The company has also focused on expanding its Silicon Germanium (SiGe) capabilities across multiple facilities to serve growing demand for optical transceiver components. This technology platform supports both traditional RF applications and emerging silicon photonics markets. Advanced platform transitions have been a major focus, with Tower migrating various product lines to 300mm (12-inch) wafer processing to improve cost competitiveness and manufacturing efficiency. This includes expanding power management, sensor, and RF technologies to larger wafer formats. The company has actively explored merger and acquisition opportunities to accelerate growth and expand technological capabilities, though no major transactions have been completed recently. Management continues to evaluate strategic partnerships and potential acquisitions that could enhance the company's technology portfolio or market position.
TSEM company profile · for informational purposes only — not investment advice.
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