Is ON (ON Semiconductor Corporation) Halal or Haram?

Based on our AAOIFI-standard shariah screening, ON is Halal and considered permissible for Muslim investors. It passed all 4 of 4 compliance screens including business activity review, debt-to-market-cap ratio (9.45% vs ≤33% threshold), interest income ratio (1.59% vs ≤5% threshold), and cash & securities ratio (6.94% vs ≤33% threshold).

ON Semiconductor Corporation is a major player in the technology sector, specializing in intelligent sensing and power solutions. The company's semiconductor chips are vital for the electrification of the automotive industry, enabling longer-range electric vehicles, fast-charging systems, and sustainable solar energy storage. For Muslim investors, ON Semiconductor represents a fully Halal investment opportunity under AAOIFI standards. The stock successfully passes all four compliance screens, meaning both its core business activities and its financial structures align with Islamic financial principles. From a financial perspective, ON is highly attractive for shariah-conscious portfolios due to its conservative balance sheet. The company's debt-to-market cap ratio is exceptionally low at 9.4%, well below the 33% limit, and its cash and securities sit safely at 6.9% of market capitalization. Because the core business of manufacturing semiconductors carries no inherent shariah concerns, there is no major scholarly debate regarding its operations. However, Muslim investors should continue to monitor its quarterly interest income, currently at a safe 1.59%, to ensure it remains below the strict 5% threshold. ON Semiconductor Corporation operates in the Technology sector under the Semiconductors industry and is headquartered in Scottsdale, AZ, US. The company is led by CEO Hassane S. El-Khoury and employs approximately 26,400 people.

ON was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. ON passed 4 of these 4 screens.

Although ON passes all shariah screens, it does earn $95.1M in interest income (1.59% of revenue). Many scholars recommend purifying this portion by donating the equivalent percentage of any dividends received to charity. For example, if you receive $100 in dividends, you would donate approximately $1.59 to purify the income.

ON was last screened on 2026-04-29. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.