Diodes (DIOD) 2026 Baird Global Consumer, Technology & Services Conference summary

Market and technology trends

• Rapid growth in AI and data center markets is driving demand for advanced power and analog solutions, with a focus on server applications and PCI Express support.

• Transition from 48V to 800V applications in power supply units is creating new opportunities, especially in silicon carbide devices and isolation solutions.

• Expansion in battery backup units, power delivery units, and digital isolation is expected to support future requirements and product development.

• Both discrete and analog product segments are experiencing growth, with balanced momentum across automotive, industrial, and AI-related markets.

• Automotive and industrial sectors show strong long-term growth potential, with automotive achieving over 20% CAGR in the past 13 years.

Manufacturing and supply chain strategy

• Hybrid manufacturing model leverages both internal and external capabilities, providing flexibility to meet dynamic demand.

• Recent fab acquisitions in Scotland and South Portland, Maine, are being integrated to support analog and discrete product lines.

• Current front-end manufacturing split is about 55% in-house, with a goal to increase to 60-70% in-house over time; back-end remains 85-90% in-house.

• Capacity expansion is focused on strategic areas like smaller, denser packages and trending technologies.

• The hybrid model and close customer collaboration help manage supply constraints and real demand, especially for tier 1 and tier 2 customers.

Pricing, inventory, and market outlook

• Peers have announced price increases due to supply-demand dynamics, but the focus remains on long-term market share and margin improvement.

• Customers are increasingly seeking long-term supply agreements, reflecting heightened concern over supply security.

• Lead times are extending, and inventory rebuilding is expected to occur next year as current conditions remain hand-to-mouth.

• Product mix changes and lessons from 2023 are guiding more targeted inventory management and customer alignment.

• Double-digit growth is expected this year, with a target to reach $2 billion in revenue within three years, supported by a 10.5% CAGR.