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Dividends Meet Chips: Top 3 Semiconductor Stocks for GrowthPower Integrations NASDAQ: POWI reported second-quarter revenue of $118.9 million, up 10% sequentially and 3% from a year earlier, as all four of its end-market categories improved from the prior quarter. The company also expanded non-GAAP operating margin to 17.1% and generated $22 million in operating cash flow.

President and CEO Jen Lloyd said the results reflected progress in the company’s effort to produce near-term profitable growth while directing more investment toward longer-term opportunities in data centers, energy infrastructure, rail, automotive and high-power industrial markets.

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Second-Quarter Financial Results American Superconductor faster than a speeding bullet on EPS beatNon-GAAP gross margin was 55.1%, up 160 basis points sequentially and slightly above the high end of the company’s outlook. Chief Financial Officer Nancy Erba attributed the increase to improved product mix, higher volume and a favorable yen-dollar exchange-rate effect. Industrial sales represented 43% of total revenue during the quarter.

Non-GAAP operating expenses were $45.2 million, slightly below the prior quarter and below the company’s outlook range. Erba said Power Integrations continued to align spending with revenue following a first-quarter restructuring and other efficiency initiatives, while maintaining investments in strategic growth markets.

Power Integrations Stock Can Power Your Portfolio Non-GAAP net income was $20.9 million, or $0.37 per diluted share, compared with $0.25 per diluted share in the prior quarter. Free cash flow totaled $18 million, reflecting $22 million in operating cash flow and $4 million in capital expenditures.

Inventory on the company’s balance sheet declined by $5 million, while days on hand fell by 27 days to 265 days at quarter-end. Channel inventory also improved, with weeks on hand declining by more than one-and-a-half weeks to 7.3 weeks. Erba said the company views seven to eight weeks as an appropriate range for channel inventory and expects further reductions in inventory days during the second half of 2026.

Industrial Growth and Product Activity Industrial revenue increased 14% during the quarter, led by home and building automation, power tools and broader industrial applications. For the first half of 2026, industrial revenue rose 16% year over year, following 15% growth in 2025, according to Erba.

Consumer revenue rose 5% sequentially, with seasonal air-conditioning demand offsetting continued softness in major appliances. Communications revenue increased 16% sequentially and computer revenue grew 5%, both recovering from seasonal lows in the first quarter.

Lloyd said the company’s appliance and low-power industrial markets will remain key contributors to revenue and cash flow as it shifts additional research, development and go-to-market resources to higher-power markets. She cited TOPSwitch-GaN and TinySwitch-5 as recent releases designed to build on existing customer familiarity and product architectures.

TinySwitch-5 has entered production designs and is expected to make a meaningful revenue contribution in the second half of 2026, particularly among appliance customers, Lloyd said. The company also said it has a healthy appliance-design pipeline, supported largely by TinySwitch-5 and TOPSwitch-GaN.

Automotive revenue, which Power Integrations includes within industrial, is on track to double in 2026, according to Lloyd. During the second quarter, the company won a design at a major tier-one supplier for a gallium-nitride-based micro DC-DC converter scheduled to enter production next year. Lloyd said the company continues to target $100 million in automotive revenue in the 2029-to-2030 timeframe, subject to electric-vehicle market conditions.

High-Voltage GaN Roadmap and Data Centers Power Integrations demonstrated its 2,200-volt PowiGaN technology, extending its high-voltage gallium-nitride roadmap beyond prior 750-volt, 900-volt, 1,250-volt and 1,700-volt platforms. Lloyd said the technology is currently a demonstration rather than a commercial product and that meaningful revenue is likely several years away.

The company sees potential applications for the 2,200-volt technology in data centers and automotive systems. Lloyd said the roadmap could help customers planning for future 1,500-volt power architectures, while the company’s current products address opportunities associated with 800-volt data-center systems.

Power Integrations is pursuing two data-center opportunity tracks: auxiliary power applications that can use products available today, and the main power path to graphics processing units. Lloyd said auxiliary-power revenue could begin in 2028, while the main power-path opportunity remains earlier in development and is further out in time.

In June, the company published two reference designs for NVIDIA 800-volt racks using its 1,700-volt InnoMux products. Lloyd said the auxiliary power supplies would sit on compute trays in native 800-volt systems and could provide about 30% space savings relative to discrete silicon-carbide designs.

The company also said it is shipping gate drivers into battery-storage systems used alongside renewable-energy installations. During the second quarter, it won a utility-scale design at a supplier of batteries for energy-storage systems and electric vehicles.

Third-Quarter Outlook For the third quarter, Power Integrations forecast revenue of $122 million to $130 million, representing a 6% sequential increase at the midpoint. The company expects consumer revenue to decline seasonally, while communications, computer and industrial revenue continue to increase.

Non-GAAP gross margin is expected to be 54% to 55%. Non-GAAP operating expenses are projected at $45 million to $46 million. Non-GAAP operating margin is expected to range from 17% to 19%. Erba said the company now expects a low-single-digit decline in non-GAAP operating expenses for the full year, compared with its prior expectation for low-single-digit growth, while continuing investments in data center, industrial, energy, automotive and rail initiatives.

About Power Integrations (NASDAQ:POWI)Power Integrations, Inc, based in Hillsboro, Oregon, specializes in the design and development of high-performance analog and mixed-signal integrated circuits for energy-efficient power conversion. The company's products are used to convert and regulate electrical power in a wide range of applications, from consumer electronics and industrial systems to communications equipment and electric vehicle charging. By providing compact, reliable, and highly integrated solutions, Power Integrations aims to reduce system size, improve efficiency, and simplify thermal management for its customers.

The firm's product portfolio encompasses isolated and non-isolated switching controllers for both AC-DC and DC-DC power conversion.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Industry-first 2200 V PowiGaN™ technology enables higher power density, greater efficiency and safer and simpler system architectures for AI data centers, EVs, photovoltaic and HVDC infrastructure

SAN JOSE, Calif.--(BUSINESS WIRE)--Power Integrations (NASDAQ: POWI), the leader in high-voltage integrated circuits for energy-efficient power conversion, today announced that PowiGaN™ gallium-nitride (GaN) technology is now rated at up to 2200 V, far exceeding the voltage capabilities of all other commercially available GaN technologies. This breakthrough positions PowiGaN as the leading technology solution for high-voltage data centers, EVs, renewable energy and HVDC infrastructure as they leverage higher-voltage bus architectures in search of greater power density.

“Our 2200 V PowiGaN technology provides substantial voltage margin for emerging high-voltage power systems while enabling the high switching frequencies required to maximize power density,” said Jennifer Lloyd, president and CEO at Power Integrations. “Emerging applications include next-generation AI data centers, where industry roadmaps point toward 1500 V distribution architectures, as well as future EV battery and auxiliary power systems operating at increasingly higher output voltages (48V). This milestone breakthrough extends the reach of GaN into voltage ranges traditionally served by SiC, enabling a compelling high-frequency alternative for applications such as solar, HVDC and advanced industrial power conversion.”

GaN power switches are steadily supplanting silicon transistors in a wide range of power conversion applications thanks to their higher efficiency and switching frequencies. However, GaN technology must keep pace with data center, EV, renewables and HVDC infrastructure roadmaps calling for higher voltages and greater power density. Alternatives include lower-frequency silicon carbide (SiC) or arrays of stacked, lower-voltage GaN devices that require compromises on power density, complexity and reliability.

PowiGaN ICs rated at 1700 V are already being designed into single-stage data center auxiliary power applications, while 1250 V PowiGaN offers a simpler alternative to stacked solutions in the main power path in 800 VDC data centers. The introduction of 2200 V PowiGaN technology means that even higher bus architectures can be supported, future-proofing power designs not only for data centers but also for EVs, photovoltaic inverters and battery-energy storage systems.

“The shift to 800 VDC bus architectures in AI data centers is reshaping power semiconductors," explains Roy Dagher, PhD, technology and market analyst, Compound Semiconductors at Yole Group. "GaN's voltage ceiling has kept it out of the main power path, ceding that ground to SiC. A 2200 V rating changes this, giving margin for single-stage topologies and future-proofing emerging 1500 V data center and EV designs. We expect the power GaN device market to reach $3.5 billion by 2031, and extending GaN into these higher-voltage applications is an important part of that growth.”(1)

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For further information, please read our White Paper or visit our PowiGaN page.

About Power Integrations

Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission, conversion and consumption of power in applications ranging from milliwatts to megawatts in applications such as AI data centers, EVs and high-voltage direct current infrastructure. For more information, please visit www.power.com.

Forward-Looking Statements

Certain statements included in this press release that are not historical facts are forward-looking statements within the meaning of the federal securities laws, including the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or the Company’s future financial or operating performance and are sometimes accompanied by words such as “believe,” “continue,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “predict,” “plan,” “may,” “should,” “will,” “would,” “potential,” “seem,” “seek,” “outlook,” and similar expressions that concern the Company’s expectations, strategy, priorities, plans, or intentions, predict or indicate future events or trends, or that are not statements of historical matters. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Forward-looking statements in this press release include, without limitation, statements about the introduction of 2200 V GaN technology, the uses of 2200 V GaN technology in emerging markets, such as AI data centers and EVs, and the benefits of higher voltage GaN technology, among others. These statements are based on various assumptions, whether or not identified in this press release. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by an investor as a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Actual events and circumstances are very difficult or impossible to predict and will differ from the assumptions. Many actual events and circumstances are beyond the control of the Company. The Company’s expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risk and uncertainties that could cause actual results to differ materially from the forward-looking statements in this press release, including but not limited to: (i) the risks that unbeknownst to the Company, a competitor has demonstrated 2200 V GaN technology or may do so sooner than anticipated; (ii) the risks that the 2200 V PowiGaN technology may not enable higher power density, greater efficiency, or simpler system architectures for AI data centers, EVs, photovoltaic, or HVDC infrastructure to the extent or in the time frame anticipated, or at all; (iii) the risks that the PowiGaN technology may not exceed the voltage capabilities of all other commercially available GaN technologies for the time frame anticipated, or at all; (iv) the risks that PowiGaN may not represent the leading technology solution to the extent anticipated, or at all; (v) the risks that high-voltage data centers, EVs, renewable energy, and HVDC infrastructure may not leverage higher-voltage bus architectures to the extent or in the time frame anticipated, or at all; (vi) the risks that industry roadmaps that point toward 1500 V distribution architectures and future EV battery and auxiliary power systems may not be realized in the time frame or to the extent anticipated, or at all; (vii) the risks that GaN power switches may not supplant silicon transistors to the extent or in the time frame anticipated, or at all; (viii) the risks that alternatives to this GaN technology, including silicon carbide (SiC) or lower-voltage GaN devices, may be sufficient to a greater degree that anticipated, or for a longer time frame than anticipated, for some or all of the data center, EV, renewables, and HVDC infrastructure uses; (ix) the risks that the introduction of 2200 V PowiGaN technology may not allow for even higher bus architectures for data centers, EVs, photovoltaic inverters, and battery-energy storage systems to the extent or in the time frame anticipated, or at all; (x) the risks that the shift to 800 V DC bus architectures in AI data centers may not occur to the extent or in the time frame anticipated, or at all; (xi) the risks that a 2200 V rating may not provide the margin for single-stage topologies or future-proofing emerging 1500 V data center and EV design to the extent or in the time frame anticipated, or at all; (xii) the risks that the power GaN device market may not reach $3.5 billion by 2031, or at all; (xiii) the Company’s ability to forecast its performance; (xiv) changes in trade policies, in particular the escalation and imposition of new and higher tariffs, which could reduce demand for end products that incorporate the Company’s integrated circuits and/or place pressure on the Company’s prices as the Company’s customers seek to offset the impact of increased tariffs on their own products; (xv) the Company’s ability to supply products and its ability to conduct other aspects of its business, such as competing for new design wins; (xvi) changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts, and trade negotiations, which may impact the level of demand for the Company’s products; (xvii) potential changes and shifts in customer demand away from end products that utilize the Company’s integrated circuits to end products that do not incorporate the Company’s products; (xviii) the effects of competition, which may cause the Company’s revenue to decrease or cause the Company to decrease its selling prices for its products; (xix) unforeseen costs and expenses; unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates; and (xx) product development delays and defects and market acceptance of the new products. These risks and uncertainties may be amplified by current or future global conflicts and current and potential trade restrictions, trade tensions, and tariffs, all of which continue to cause economic uncertainty. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q that the Company filed with the U.S. Securities and Exchange Commission, or the SEC, and other documents filed by us or that will be filed by us from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements in this press release are based only on information currently available to the Company and speak only as of the date they are made.

Investors are cautioned not to put undue reliance on forward-looking statements, and the Company disclaims any obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. The Company gives no assurance that the Company will achieve any of its expectations.

Power Integrations, the Power Integrations logo and PowiGaN, are trademarks, service marks or registered trademarks of Power Integrations, Inc. All other trademarks are the property of their respective owners.

(1) Source: Power GaN 2026 report, Yole Group

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