Providing Energy Efficient Innovations ON Semiconductor (Nasdaq: ON) is driving innovation in energy efficient electronics, empowering customers to reduce global energy use. The company is a leading supplier of semiconductor-based solutions, offering a comprehensive portfolio of energy efficient power management, analog, sensors, logic, timing, We Are connectivity, discrete, SoC and custom devices. The company’s products help ON Semiconductor engineers solve unique design challenges in automotive, communications, computing, consumer, industrial, medical, aerospace and defense applications. ON Semiconductor operates a responsive, reliable, world-class supply chain and quality program, robust compliance and ethics programs and a network of manufacturing facilities, sales offices and design centers in key markets throughout North America, Europe and the Asia Pacific regions. For more information, visit http://www.onsemi.com • Follow @onsemi on Twitter: www.twitter.com/onsemi • Follow @安森美半导体 on Weibo: www.weibo.com/onsemiconductor We are ON Semiconductor ON Semiconductor continued its role as a leader of energy efficient semiconductors that help make the world greener, safer and more connected. The company has continued to be the trusted supplier/partner of choice, in spite of challenging macroeconomic and geopolitical conditions facing the industry. Secular megatrends driving our business Letter to remain intact and customer interest in our comprehensive portfolio continues to be very strong. Our customers are Shareholders increasingly relying on us as a key strategic partner for their most challenging design requirements. We continue to make sustainable investments to improve our competitive position in our strategic end-markets and to improve our industry leading manufacturing cost structure. We expect that the current conditions will not detract us from our long-term goals, and we will continue to invest to position the company for current and future success. We believe that a highly diversified customer base, exposure to rapidly growing semiconductor end-markets, and long life cycles of our products should help us effectively navigate the current environment. As a global company, we constantly invest in our infrastructure, scale, technology and talent. In 2019, we made significant expansion investments, including a definitive agreement to take ownership of the 300mm East Fishkill Fab in upstate New York. We believe that the ramping up of our 300mm production will be a major inflection point in our manufacturing strategy and in our manufacturing cost structure. The fab affords us significant flexibility in optimizing our front-end network and improving the efficiency of our overall manufacturing network. Additionally, during 2019, we completed the acquisition of Quantenna Communications, Inc., a global leader and innovator of high-performance Wi-Fi solutions. The combination of ON Semiconductor’s expertise in power management, Bluetooth technologies and ultra-low power multi-protocol radio expertise with Quantenna’s multidimensional Wi-Fi and software capabilities creates a robust platform for addressing design challenges in a wide variety of applications. We will continue to evolve, transform and invest in Wi-Fi solutions as they become an important part of our business. Our highly diversified customer base and exposure to rapidly-growing semiconductor end-markets enable us to deliver solid results and effectively navigate volatility in the macroeconomic environment. Emphasis on Strategic End-Markets Our momentum in our strategic end-markets continues to accelerate. Despite the slowdown in end-market demand, we’re seeing meaningful increase in our content in automotive, industrial and cloud-power applications. ON Semiconductor will continue to invest in these areas to drive growth and profitability. “Solution Selling” allows us to provide full solutions to customers while lowering their time to market and providing development efficiencies. In the automotive end-market, we believe that accelerating adoption of electric vehicles and active safety features will drive strong growth in our power semiconductor and sensor businesses. Our leadership in Advanced Driver-Assistance Systems (ADAS) continues to strengthen, and our design-win pipeline is expanding at a rapid rate. We have won 16 of the 17 2-megapixel and 8-megapixel platforms awarded in 2019 for Level-2 and Level-3 vehicles and achieved a landmark of shipping more than 100 million AR0132 image sensors for ADAS applications. These sensors act as the “eyes” of the car and support important safety functionality including adaptive cruise control, lane keep assist and sway warning, pre-collision braking and pre-collision throttle management. Vehicle electrification is quickly emerging as a key driver of our automotive revenue. Additionally, we are continuing to gain momentum with our silicon carbide products. In the industrial end-market, our products are targeted at the innovative applications of industrial motion and energy infrastructure as we continue to work on our mission to improve energy efficiency. We continue to excel in the industrial market with strong customer reception for our image sensors in the machine vision market. We are also seeing strong traction for our power semiconductor products, driven by higher power efficiency requirements for industrial systems. Our mid- and high-voltage power semiconductor products such as FETs, IGBTs and modules continue to see increased momentum within the industrial end-market. In the cloud-power end-market, we are seeing robust growth for our analog power management products for servers and power semiconductors for 5G infrastructure markets. ON Semiconductor continues to invest in its Internet of Things (IoT) applications. IoT devices require a common set of silicon building blocks that include sensors, connectivity, power management and embedded control. Connected lighting offers high growth potential within smart homes and buildings, driven by its ability to reduce energy consumption and offering new features such as “Lighting as a Service” (LaaS). ON Semiconductor’s Connected Lighting Platforms offer an energy efficient solution for developing industrial LED lighting applications. Expanding on low power capabilities and Intelligent Connected Building solutions allows us to provide a completely battery-free wireless solution with environmental sensing and control. With the rise of Voice Control and Voice User Interfaces (VUI), audio processing has become critical to the success of a wide range of building automation and household applications. ON Semiconductor IoT expertise also extends to vision systems such as smart doorbells, AR/VR/MR, home IP cameras and wearables. Fifth Year in a Row – World’s Most Ethical Company®, Diversity, Commitment to Excellence and Sustainability For a fifth consecutive year, the Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices, awarded ON Semiconductor the prestigious World’s Most Ethical Company® designation. ON Semiconductor is one of only four companies in the semiconductor category to receive this recognition in 2020, and we attribute this recognition to our long-standing and active commitment to aligning our business objectives with ethical stewardship across an organization with approximately 35,000 employees in 34 countries‡. As our company continues to grow, we must continue to invest not only in our infrastructure, scale, technology and talent, but also in our Corporate Social Responsibility (CSR) efforts. Our CSR and Sustainability programs have been recognized by Barrons, EcoVadis and other external stakeholders. We are a signatory to the UN Global Compact, and we are committed to continually expanding our diversity, social and human rights, ethics and sustainability programs to new levels. ON Semiconductor is committed to creating both social and economic value through our sustainability, diversity, governance and social responsibility programs. The recent Blackrock letter to CEOs advocates providing our stakeholders a clear picture of our activities in this area. While we currently do not yet report through SASB or TCFD, we are conducting the essential elements: our climate, environmental, diversity, governance and social reporting through the lens of these standards. We have implemented five-year targets on our environmental conservation performance at our wafer fabs and assembly and test operation sites and we are currently working to develop appropriate science based targets. These include targets set to reduce carbon emissions, water consumption, energy consumption and chemical consumption. Our reports highlight our health and safety culture, enterprise risk management (ERM) as well as governance, diversity, sourcing goals and intellectual property privacy programs. Risk due to natural disasters (including floods) or fire and the associated mitigation actions are presented to our Board of Directors on a quarterly basis. In our 2016 and 2017 reports, we reported in accordance with the GRI Standards: core option, however, starting with our 2018 CSR Report we began reporting in accordance with the GRI Standards: comprehensive option. The GRI Standards contain several topic-specific standards to report on climate change, such as emissions, energy, water and effluents, and economic performance that relates to financial implications and other risks and opportunities due to climate change. In 2019, the ON Semiconductor