The Short Answer
Alpha and Omega Semiconductor stock (AOSL) is qualitatively halal and its known financial ratios pass, but the overall result is incomplete. The March 31, 2026 filing does not provide a universal prohibited-revenue numerator.
Current quantitative Sharia screen
Based on 10-Q figures for the period ended 2026-03-31; calculated 2026-07-15.
5.901 / 976.413
190.253 / 976.413
244.189 / 976.413
0.99 / 163.792
- Financial
- Pass
- Overall
- Incomplete
Debt/assets is 0.60%, liquidity/assets is 19.48%, receivables-plus-cash/assets is 25.01% and disclosed interest income is 0.60%; known ratios pass, while activity remains incomplete.
- Financial
- Pass
- Overall
- Incomplete
Known financial ratios pass; this is not an index-membership claim and activity remains incomplete.
- Financial
- Pass
- Overall
- Incomplete
Known debt, liquidity and disclosed income ratios pass; this is not an official classification.
- Financial
- Not calculated
- Overall
- Incomplete
A licensed historical market-cap series is not stored.
Business-activity disclosure
Alpha and Omega Semiconductor manufactures power discrete and power IC semiconductor products. The general semiconductor activity is generally permissible, while customer and end-use revenue is not reduced to a universal prohibited-revenue numerator.
Limitation: The filing does not classify every customer end use or joint-venture stream by a universal Sharia category; activity remains qualitative.
Purification
Alpha and Omega discloses $0.990 million of interest income for the quarter, but ZakatInvest does not prescribe a scholar-approved purification percentage.
Inputs, assumptions and primary sources
- Amounts are USD millions from Alpha and Omega Semiconductor's March 31, 2026 Form 10-Q.
- Debt includes $3.036 million short-term debt, $1.332 million long-term debt and $1.533 million finance-lease liabilities; operating leases are excluded.
- Cash and cash equivalents are $190.253 million; no separate debt-security balance is reported.
- Accounts receivable includes $38.335 million trade receivables and a $15.601 million receivable from sale of an equity interest; third-quarter revenue is $163.792 million.
- The filing reports $0.990 million of interest income for the quarter; no fixed purification percentage is prescribed.
- Power discrete and power IC products are generally permissible, while automotive, industrial and consumer end uses remain qualitative.
This is a reproducible financial screen, not a fatwa. A failed total-assets screen can coexist with a pass under a market-cap methodology. ZakatInvest keeps the qualitative assessment separate so numerical thresholds do not erase material context.
Designing and selling power semiconductors is generally permissible. Alpha and Omega has low known leverage, and disclosed interest income is 0.60% of quarterly revenue; joint-venture and customer end uses remain qualitative.
Sharia Screening Methodology
Islamic scholars use several criteria to screen stocks:
- Business activity screen: Is the company's primary business halal?
- Debt ratio: Total debt / market cap must be under 33%
- Interest income: Interest income / total revenue must be under 5%
- Haram revenue: Revenue from haram sources must be under 5%
- Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)
Alpha and Omega Semiconductor's Business Activity
Alpha and Omega designs and manufactures power semiconductors. Its products include:
- Power MOSFETs: Devices for efficient power switching
- Power ICs: Power-management integrated circuits
- IGBTs & modules: Power devices for industrial and automotive use
Designing and selling these power semiconductors is permissible at the activity level — they are general-purpose components used across many industries.
Concerns to Be Aware Of
1. Interest Income on Cash
Alpha and Omega holds cash that generates interest income. Verify the interest-income-to-revenue ratio against the 5% threshold and purify the corresponding portion of returns.
2. Debt Ratio
Alpha and Omega typically operates with low leverage. Confirm the debt-to-market-cap ratio against the 33% threshold at the time of investment.
3. Cyclicality
As a focused power-semiconductor company, revenue and margins are cyclical and sensitive to inventory and end-market demand. This is a business and valuation consideration rather than a Sharia screen concern.
Filing-Based Ratios (March 31, 2026)
Based on Alpha and Omega Semiconductor's Form 10-Q:
- Debt / Assets: 0.60%
- Cash + interest-bearing securities / Assets: 19.48%
- Receivables + cash / Assets: 25.01%
- Disclosed interest income / Revenue: 0.60%
Methodology Interpretation
The known FTSE, MSCI and Malaysia financial ratios pass. Activity and prohibited-revenue classification remain incomplete, including joint-venture exposure; this is not a universal certification.
Bottom Line
Alpha and Omega Semiconductor (AOSL) has a generally permissible semiconductor business and passes the known financial ratios in this filing, but the overall result remains incomplete because activity and prohibited-revenue classification are not universal quantitative measures. Investors should apply their chosen methodology and purification policy.
For Muslim investors seeking semiconductor exposure, AOSL sits alongside other halal-screened names like ON Semiconductor (ON) and Diodes (DIOD).
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