Update: The story was updated with information from the earnings call and stock price movement.

Shares of ON Semiconductor (NASDAQ:ON) rose about 2% on Monday after third-quarter results beat estimates; however, the outlook drew mixed reactions on Wall Street.

The company expects fourth-quarter revenue to be between $1.71B and $1.81B (midpoint at $1.76B), vs. the consensus revenue estimate of $1.78B. Meanwhile, adjusted earnings per share are anticipated in the range of $0.92 to $1.04 (midpoint at $0.98) compared to the consensus estimate of $1 per share.

"Over the last several quarters, we talked about an L-shaped recovery and as expected, the demand environment remains muted with ongoing inventory digestion and slow end demand," said Hassane El-Khoury, President and CEO, on the company's earnings call. "Our outlook for all market remains unchanged as uncertainty persists among our customers."

El-Khoury added that automotive continues to be soft with a slowing EV sector. Meanwhile, industrial, which had slowed first, has now broadly recovered except for pockets in utility-scale solar, and aerospace and defense.

Regionally, China and Japan are recovering, while North America and Europe remain soft in both automotive and industrial.

Despite the current slowdown, the company is confident in its strategy, El-Khoury noted.

Truist Securities noted that the outlook "is a hair below consensus" and inventory "remains well above the company’s 115-120 day target," according to Bloomberg.

Meanwhile, KeyBanc Capital Markets said that the outlook was slightly lower, with revenue, EPS and gross margin slightly below, likely reflecting continued weakness in automotive.

However, William Blair was more optimistic, noting that the initial read-through is positive as the company is maintaining the gross margin floor guidance of 45%.

Q3 Metrics:

Third quarter revenue fell about 19% year-over-year to around $1.76B, while non-GAAP EPS tumbled nearly 28% year-on-year to $0.99. However, both top and bottom-line numbers surpassed analyst expectations.

"With third-quarter results above expectations, we remain focused on delivering consistent results in the current environment through execution and prudent financial management," said El-Khoury in the company's earnings release.

Revenue from the Power Solutions Group segment declined about 23% year-over-year to $829.4M, while revenue from the Analog and Mixed-Signal Group segment revenue fell 16% year-over-year to $653.7M.

"As power demands continue to rise across our key markets, and the need for greater efficiency becomes paramount, we are investing to win across the entire power spectrum to ensure that ON Semi is best positioned to gain share in automotive, industrial and AI data center," El-Khoury said in the company's earnings release.

Revenue from Intelligent Sensing Group segment fell about 15% year-over-year to $278.8M.

Shares of related tech stocks on Monday: NXP Semiconductors (NXPI) 1%, STMicroelectronics (STM) and Analog Devices (ADI) and Texas Instruments (TXN), were largely flat.