NXP Semiconductors N.V reported financial results for the first quarter, ended April 2, 2023. “NXP delivered quarterly revenue of $3.12 billion, with all our focus end-markets performing better than anticipated, which resulted in total company revenue above the high end of guidance. Solid first-quarter results, guidance for the second quarter, and our early views into the second half of the year underpin a cautious optimism that NXP is successfully navigating through the cyclical downturn in our consumer-exposed businesses, while we see continued strength in our automotive and core-industrial businesses,” said Kurt Sievers, NXP President and Chief Executive Officer.
Key Highlights for the First Quarter 2023:
- Revenue was $3.12 billion, down 0.5 percent year-on-year
- GAAP gross margin was 56.7 percent, GAAP operating margin was 26.4 percent and GAAP diluted Net Income per Share was $2.35
- Non-GAAP gross margin was 58.2 percent, non-GAAP operating margin was 34.8 percent, and non-GAAP diluted Net Income per Share was $3.19
- Cash flow from operations was $632 million, with net capex investments of $251 million, resulting in non-GAAP free cash flow of $381 million
- On January 5, 2023, NXP announced the SAF85xx, the automotive industries first 28nm, single chip RFCMOS radar family for next generation ADAS and autonomous driving systems. The SAF85xx radar family reinforces NXP’s leading radar portfolio, built on more than 15 years of technology leadership
- On February 17, 2023, NXP was named one of the Top 100 Global Innovators 2023 by Clarivate for the sixth time. The award identifies organizations at the pinnacle of the global innovation landscape by measuring excellence focused on exceptional consistency and scale in innovativeness;
- On February 22, 2023, NXP announced the EdgeLock SE051H, a single chip secure element designed for Matter, adding to the industry’s broadest portfolio of Matter devices
- On March 29, 2023, NXP announced the UCODE 9xm family of RFID tag solutions, providing high-capacity, flexible memory and industry-leading read/write performance. The UCODE 9xm family, enables smaller tag antennas, supporting the tagging of smaller objects in supply chain tracking applications.
NXP has based the guidance included in this release on judgments and estimates that management believes are reasonable given its assessment of historical trends and other information reasonably available as of the date of this release. Please note, the guidance included in this release consists of predictions only, and is subject to a wide range of known and unknown risks and uncertainties, many of which are beyond NXP’s control. The guidance included in this release should not be regarded as representations by NXP that the estimated results will be achieved. Actual results may vary materially from the guidance we provide today. In relation to the use of non-GAAP financial information see the note regarding “Non-GAAP Financial Measures” below. For the factors, risks, and uncertainties to which judgments, estimates and forward-looking statements generally are subject see the note regarding “Forward-looking Statements.” We undertake no obligation to publicly update or revise any forward-looking statements, including the guidance set forth herein, to reflect future events or circumstances.
Non-GAAP Financial Measures
In managing NXP’s business on a consolidated basis, management develops an annual operating plan, which is approved by our Board of Directors, using non-GAAP financial measures, that are not in accordance with, nor an alternative to, U.S. generally accepted accounting principles (“GAAP”). In measuring performance against this plan, management considers the actual or potential impacts on these non-GAAP financial measures from actions taken to reduce costs with the goal of increasing our gross margin and operating margin and when assessing appropriate levels of research and development efforts. In addition, management relies upon these non-GAAP financial measures when making decisions about product spending, administrative budgets, and other operating expenses. We believe that these non-GAAP financial measures, when coupled with the GAAP results and the reconciliations to corresponding GAAP financial measures, provide a more complete understanding of the Company’s results of operations and the factors and trends affecting NXP’s business. We believe that they enable investors to perform additional comparisons of our operating results, to assess our liquidity and capital position and to analyze financial performance excluding the effect of expenses unrelated to operations, certain non-cash expenses and share-based compensation expense, which may obscure trends in NXP’s underlying performance. This information also enables investors to compare financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management.
These non-GAAP financial measures are provided in addition to, and not as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. The presentation of these and other similar items in NXP’s non-GAAP financial results should not be interpreted as implying that these items are non-recurring, infrequent, or unusual. Reconciliations of these non-GAAP measures to the most comparable measures calculated in accordance with GAAP are provided in the financial statements portion of this release in a schedule entitled “Financial Reconciliation of GAAP to non-GAAP Results (unaudited).” Please refer to the NXP Historic Financial Model file found on the Financial Information page of the Investor Relations section of our website at https://investors.nxp.com for additional information related to our rationale for using these non-GAAP financial measures, as well as the impact of these measures on the presentation of NXP’s operations.
