NXP Semiconductors N.V. (NASDAQ: NXPI) today reported financial
results for the third quarter, ended October 1, 2023.
“NXP delivered quarterly revenue of $3.43 billion, $34 million
above the midpoint of guidance. Revenue trends in our Mobile,
Industrial & IoT and Automotive end-markets all performed
in-line or better than anticipated, while our Communication
Infrastructure & Other end market was slightly below our
expectations. The combination of our third quarter results, and the
mid-point of our fourth quarter guidance indicates revenue for the
full year 2023 will be flat versus 2022 in a challenging and
cyclical market environment,” said Kurt Sievers, NXP President and
Chief Executive Officer.
Key Highlights for the Third Quarter 2023:
- Revenue was $3.43 billion, down 0.3 percent year-on-year;
- GAAP gross margin was 57.2 percent, GAAP operating margin was
28.9 percent and GAAP diluted Net Income per Share was $3.01;
- Non-GAAP gross margin was 58.5 percent, non-GAAP operating
margin was 35.0 percent, and non-GAAP diluted Net Income per Share
was $3.70;
- Cash flow from operations was $988 million, with net capex
investments of $200 million, resulting in non-GAAP free cash flow
of $788 million;
- During the third quarter of 2023, NXP continued to execute its
capital return policy with the payment of $262 million in cash
dividends, and the repurchase of $306 million of its common shares.
The total capital return of $568 million in the quarter represented
72 percent of third quarter non-GAAP free cash flow. The interim
dividend for the third quarter 2023 was paid in cash on October 5,
2023 to shareholders of record as of September 13, 2023. Subsequent
to the end of the third quarter, between October 2, 2023 and
November 3, 2023, NXP executed via a 10b5-1 program additional
share repurchases totaling $124 million;
- On August 4, 2023, Semiconductor industry players Bosch,
Infineon, Nordic Semiconductor, NXP, and Qualcomm Technologies,
announced the planned formation of a joint-venture aimed at
advancing the adoption of RISC-V globally;
- On August 8, 2023, TSMC, Bosch, Infineon, and NXP announced the
planned formation of a joint venture European Semiconductor
Manufacturing Company (ESMC) GmbH, in Dresden, Germany to provide
advanced semiconductor manufacturing services predominantly to the
automotive and industrial sectors. The planned 300mm fab joint
venture will be 70% owned by TSMC, with Bosch, Infineon, and NXP
each holding 10% equity stake; and
- On September 19, 2023 NXP announced it is strengthening its
European research and development (R&D) through grants to be
provided via the 2nd Important Project of Common European Interest
on Microelectronics and Communication Technologies (IPCEI ME/CT).
Dedicated NXP teams across Austria, Germany, the Netherlands and
Romania will drive innovation including 5nm design for the Software
Defined Vehicle, radar and battery management systems in
automotive, and Ultra-Wideband as well as artificial intelligence
(AI), RISC-V and post-quantum cryptography.
Summary of Reported Third Quarter 2023 ($ millions,
unaudited) (1)
|
Q3 2023 |
Q2 2023 |
Q3 2022 |
Q - Q |
Y - Y |
Total Revenue |
$ |
3,434 |
|
$ |
3,299 |
|
$ |
3,445 |
|
4 |
% |
— |
% |
GAAP Gross
Profit |
$ |
1,965 |
|
$ |
1,881 |
|
$ |
1,967 |
|
4 |
% |
— |
% |
Gross Profit Adjustments (i) |
$ |
(45 |
) |
$ |
(45 |
) |
$ |
(32 |
) |
|
|
Non-GAAP Gross
Profit |
$ |
2,010 |
|
$ |
1,926 |
|
$ |
1,999 |
|
4 |
% |
1 |
% |
GAAP Gross Margin |
|
57.2 |
% |
|
57.0 |
% |
|
57.1 |
% |
|
|
Non-GAAP Gross Margin |
|
58.5 |
% |
|
58.4 |
% |
|
58.0 |
% |
|
|
GAAP Operating Income
(Loss) |
$ |
992 |
|
$ |
937 |
|
$ |
1,001 |
|
6 |
% |
-1 |
% |
Operating Income Adjustments (i) |
$ |
(211 |
) |
$ |
(218 |
) |
$ |
(270 |
) |
|
|
Non-GAAP Operating
Income |
$ |
1,203 |
|
$ |
1,155 |
|
$ |
1,271 |
|
4 |
% |
-5 |
% |
GAAP Operating Margin |
|
28.9 |
% |
|
28.4 |
% |
|
29.1 |
% |
|
|
Non-GAAP Operating Margin |
|
35.0 |
% |
|
35.0 |
% |
|
36.9 |
% |
|
|
GAAP Net Income (Loss)
attributable to Stockholders |
$ |
787 |
|
$ |
698 |
|
|
|
|
Net Income Adjustments (i) |
$ |
(178 |
) |
$ |
(198 |
) |
|
|
|
Non-GAAP Net Income
(Loss) Attributable to Stockholders |
$ |
965 |
|
$ |
896 |
|
|
|
|
GAAP diluted Net
Income (Loss) per Share |
$ |
3.01 |
|
$ |
2.67 |
|
|
|
|
Non-GAAP diluted Net
Income (Loss) per Share |
$ |
3.70 |
|
$ |
3.43 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
information |
|
|
|
|
|
|
Q3 2023 |
Q2 2023 |
Q3 2022 |
Q - Q |
Y - Y |
Automotive |
$ |
1,891 |
|
$ |
1,866 |
|
$ |
1,804 |
|
1 |
% |
5 |
% |
Industrial & IoT |
$ |
607 |
|
$ |
578 |
|
$ |
713 |
|
5 |
% |
-15 |
% |
Mobile |
$ |
377 |
|
$ |
284 |
|
$ |
410 |
|
33 |
% |
-8 |
% |
Comm. Infra. & Other |
$ |
559 |
|
$ |
571 |
|
$ |
518 |
|
-2 |
% |
8 |
% |
DIO |
|
134 |
|
|
137 |
|
|
99 |
|
|
|
DPO (ii) |
|
60 |
|
|
63 |
|
|
69 |
|
|
|
DSO |
|
25 |
|
|
29 |
|
|
27 |
|
|
|
Cash Conversion Cycle |
|
99 |
|
|
103 |
|
|
57 |
|
|
|
Channel Inventory (months) |
|
1.5 |
|
|
1.6 |
|
|
1.6 |
|
|
|
Gross Financial Leverage (iii) |
|
2.1x |
|
|
2.1x |
|
|
2.1x |
|
|
|
Net Financial Leverage (iv) |
|
1.3x |
|
|
1.3x |
|
|
1.4x |
|
|
|
|
|
|
|
|
|
- Additional Information for the Third Quarter
2023:
- For an explanation of GAAP to non-GAAP adjustments, please see
“Non-GAAP Financial Measures”.
- We have reclassified certain amounts related to customer
programs previously presented in “Accounts Payable” to “Other
current liabilities” to conform to current period presentation. The
impact of the reclassification on DPO (decreasing impact) and CCC
(increasing impact) was 27 days for the third quarter of 2022.
- Gross financial leverage is defined as gross debt divided by
trailing twelve months adjusted EBITDA.
- Net financial leverage is defined as net debt divided by
trailing twelve months adjusted EBITDA.
- Weighted average number of diluted shares for the three-month
period ended October 1, 2023 was 261.1 million.
Guidance for the Fourth Quarter 2023: ($ millions,
except Per Share data) (1)
|
Guidance Range |
|
GAAP |
|
Reconciliation |
|
non-GAAP |
|
Low |
|
Mid |
|
High |
|
|
|
Low |
|
Mid |
|
High |
Total Revenue |
$ |
3,300 |
|
|
$ |
3,400 |
|
|
$ |
3,500 |
|
|
|
|
$ |
3,300 |
|
|
$ |
3,400 |
|
|
$ |
3,500 |
|
Q-Q |
|
-4 |
% |
|
|
-1 |
% |
|
|
2 |
% |
|
|
|
|
-4 |
% |
|
|
-1 |
% |
|
|
2 |
% |
Y-Y |
|
— |
% |
|
|
3 |
% |
|
|
6 |
% |
|
|
|
|
— |
% |
|
|
3 |
% |
|
|
6 |
% |
Gross Profit |
$ |
1,866 |
|
|
$ |
1,941 |
|
|
$ |
2,017 |
|
|
$ |
(48 |
) |
|
$ |
1,914 |
|
|
$ |
1,989 |
|
|
$ |
2,065 |
|
Gross Margin |
|
56.5 |
% |
|
|
57.1 |
% |
|
|
57.6 |
% |
|
|
|
|
58.0 |
% |
|
|
58.5 |
% |
|
|
59.0 |
% |
Operating Income (loss) |
$ |
928 |
|
|
$ |
993 |
|
|
$ |
1,059 |
|
|
$ |
(211 |
) |
|
$ |
1,139 |
|
|
$ |
1,204 |
|
|
$ |
1,270 |
|
Operating Margin |
|
28.1 |
% |
|
|
29.2 |
% |
|
|
30.3 |
% |
|
|
|
|
34.5 |
% |
|
|
35.4 |
% |
|
|
36.3 |
% |
Financial Income (expense) |
$ |
(77 |
) |
|
$ |
(77 |
) |
|
$ |
(77 |
) |
|
$ |
(8 |
) |
|
$ |
(69 |
) |
|
$ |
(69 |
) |
|
$ |
(69 |
) |
Tax rate |
15.5%-16.5% |
|
|
|
15.5%-16.5% |
NCI & Other |
$ |
(9 |
) |
|
$ |
(9 |
) |
|
$ |
(9 |
) |
|
$ |
(3 |
) |
|
$ |
(6 |
) |
|
$ |
(6 |
) |
|
$ |
(6 |
) |
Shares - diluted |
|
260.0 |
|
|
|
260.0 |
|
|
|
260.0 |
|
|
|
|
|
260.0 |
|
|
|
260.0 |
|
|
|
260.0 |
|
Earnings Per Share - diluted |
$ |
2.71 |
|
|
$ |
2.92 |
|
|
$ |
3.13 |
|
|
|
|
$ |
3.44 |
|
|
$ |
3.65 |
|
|
$ |
3.86 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note (1) Additional Information:
- GAAP Gross Profit is expected to include Purchase Price
Accounting (“PPA”) effects, $(13) million; Share-based
Compensation, $(14) million; Other Incidentals, $(21) million;
- GAAP Operating Income (loss) is expected to include PPA
effects, $(77) million; Share-based Compensation, $(106) million;
Restructuring and Other Incidentals, $(28) million;
- GAAP Financial Income (expense) is expected to include Other
financial expense $(8) million;
- GAAP Non-Controlling Interest (NCI) and Other includes
non-controlling interest $(6) million and Other $(3) million;
- GAAP diluted EPS is expected to include the adjustments noted
above for PPA effects, Share-based Compensation, Restructuring and
Other Incidentals in GAAP Operating Income (loss), the adjustment
for Other financial expense, the adjustment for Non-controlling
interest & Other and the adjustment on Tax due to the earlier
mentioned adjustments.
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.
In addition to providing financial information on a basis
consistent with GAAP, NXP also provides the following selected
financial measures on a non-GAAP basis: (i) Gross profit, (ii)
Gross margin, (iii) Research and development, (iv) Selling, general
and administrative, (v) Amortization of acquisition-related
intangible assets, (vi) Other income, (vii) Operating income
(loss), (viii) Operating margin, (ix) Financial Income (expense),
(x) Income tax benefit (provision), (xi) Results relating to
equity-accounted investees, (xii) Net income (loss) attributable to
stockholders, (xiii) Earnings per Share - Diluted, (xiv) EBITDA,
adjusted EBITDA and trailing 12 month adjusted EBITDA, and (xv)
free cash flow, trailing 12 month free cash flow and trailing 12
month free cash flow as a percent of Revenue. The non-GAAP
information excludes, where applicable, the amortization of
acquisition related intangible assets, the purchase accounting
effect on inventory and property, plant and equipment, merger
related costs (including integration costs), certain items related
to divestitures, share-based compensation expense, restructuring
and asset impairment charges, extinguishment of debt, foreign
exchange gains and losses, income tax effect on adjustments
described above and results from equity-accounted investments.
The difference in the benefit (provision) for income taxes
between our GAAP and non-GAAP results relates to the income tax
effects of the GAAP to non-GAAP adjustments that we make and the
income tax effect of any discrete items that occur in the interim
period. Discrete items primarily relate to unexpected tax events
that may occur as these amounts cannot be forecasted (e.g., the
impact of changes in tax law and/or rates, changes in estimates or
resolved tax audits relating to prior year tax provisions, the
excess or deficit tax effects on share-based compensation,
etc.).
Conference Call and Webcast InformationThe
company will host a conference call with the financial community on
Tuesday, November 7, 2023 at 8:00 a.m. U.S. Eastern Standard Time
(EST) to review the third quarter 2023 results in detail.
Interested parties may preregister to obtain a user-specific
access code for the call here.
The call will be webcast and can be accessed from the NXP
Investor Relations website at www.nxp.com. A replay of the call
will be available on the NXP Investor Relations website within 24
hours of the actual call.
About NXP Semiconductors
NXP Semiconductors N.V. (NASDAQ: NXPI) brings together bright
minds to create breakthrough technologies that make the connected
world better, safer and more secure. As a world leader in secure
connectivity solutions for embedded applications, NXP is pushing
boundaries in the automotive, industrial & IoT, mobile, and
communication infrastructure markets while delivering solutions
that advance a more sustainable future. Built on more than 60 years
of combined experience and expertise, the company has approximately
34,500 team members in more than 30 countries and posted revenue of
$13.21 billion in 2022. Find out more at www.nxp.com.
Forward-looking Statements
This document includes forward-looking statements which include
statements regarding NXP’s business strategy, financial condition,
results of operations, market data, as well as any other statements
which are not historical facts. By their nature, forward-looking
statements are subject to numerous factors, risks and uncertainties
that could cause actual outcomes and results to be materially
different from those projected. These factors, risks and
uncertainties include the following: market demand and
semiconductor industry conditions; our ability to successfully
introduce new technologies and products; the demand for the goods
into which NXP’s products are incorporated; trade disputes between
the U.S. and China, potential increase of barriers to international
trade and resulting disruptions to NXP's established supply chains;
the impact of government actions and regulations, including
restrictions on the export of US-regulated products and technology;
the ability to generate sufficient cash, raise sufficient capital
or refinance corporate debt at or before maturity to meet both
NXP's debt service and research and development and capital
investment requirements; our ability to accurately estimate demand
and match our production capacity accordingly or obtain supplies
from third-party producers to meet demand; our access to production
capacity from third-party outsourcing partners, and any events that
might affect their business or NXP’s relationship with them; our
ability to secure adequate and timely supply of equipment and
materials from suppliers; our ability to avoid operational problems
and product defects and, if such issues were to arise, to correct
them quickly; our ability to form strategic partnerships and joint
ventures and to successfully cooperate with our alliance partners;
our ability to win competitive bid selection processes; our ability
to develop products for use in customers’ equipment and products;
the ability to successfully hire and retain key management and
senior product engineers; the invasion of Ukraine by Russia and
resulting regional instability, sanctions and any other retaliatory
measures taken against Russia and the continued hostilities, civil
unrest and the armed conflict in the Middle East, which could
adversely impact the global supply chain, disrupt our operations or
negatively impact the demand for our products in our primary end
markets; and, the ability to maintain good relationships with NXP's
suppliers. In case tax laws change, this could have an effect on
our estimated effective tax rates. In addition, this document
contains information concerning the semiconductor industry and
NXP’s market and business segments generally, which is
forward-looking in nature and is based on a variety of assumptions
regarding the ways in which the semiconductor industry and NXP's
market and business segments may develop. NXP has based these
assumptions on information currently available, if any one or more
of these assumptions turn out to be incorrect, actual results may
differ from those predicted. While NXP does not know what impact
any such differences may have on its business, if there are such
differences, its future results of operations and its financial
condition could be materially adversely affected. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak to results only as of the date the
statements were made. Except for any ongoing obligation to disclose
material information as required by the United States federal
securities laws, NXP does not have any intention or obligation to
publicly update or revise any forward-looking statements after we
distribute this document, whether to reflect any future events or
circumstances or otherwise. For a discussion of potential risks and
uncertainties, please refer to the risk factors listed in our SEC
filings. Copies of our SEC filings are available on our Investor
Relations website, www.nxp.com/investor or from the SEC website,
www.sec.gov.
For further information, please contact: |
|
|
|
|
|
Investors:Jeff Palmerjeff.palmer@nxp.com+1 408 518
5411 |
|
Media:Jacey Zuniga jacey.zuniga@nxp.com+1 512 895
7398 |
|
|
|
NXP-CORP
NXP SemiconductorsTable 1: Condensed
consolidated statement of operations (unaudited)
($ in millions except share data) |
Three months ended |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
|
|
|
|
|
|
Revenue |
$ |
3,434 |
|
|
$ |
3,299 |
|
|
$ |
3,445 |
|
Cost
of revenue |
|
(1,469 |
) |
|
|
(1,418 |
) |
|
|
(1,478 |
) |
Gross profit |
|
1,965 |
|
|
|
1,881 |
|
|
|
1,967 |
|
Research and development |
|
(601 |
) |
|
|
(589 |
) |
|
|
(548 |
) |
Selling, general and administrative |
|
(294 |
) |
|
|
(274 |
) |
|
|
(289 |
) |
Amortization of acquisition-related intangible assets |
|
(71 |
) |
|
|
(81 |
) |
|
|
(131 |
) |
Total operating expenses |
|
(966 |
) |
|
|
(944 |
) |
|
|
(968 |
) |
Other
income (expense) |
|
(7 |
) |
|
|
— |
|
|
|
2 |
|
Operating income (loss) |
|
992 |
|
|
|
937 |
|
|
|
1,001 |
|
Financial income (expense): |
|
|
|
|
|
Extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
Other
financial income (expense) |
|
(75 |
) |
|
|
(74 |
) |
|
|
(98 |
) |
Income (loss) before income taxes |
|
917 |
|
|
|
863 |
|
|
|
903 |
|
Benefit (provision) for income taxes |
|
(123 |
) |
|
|
(158 |
) |
|
|
(149 |
) |
Results relating to equity-accounted investees |
|
(2 |
) |
|
|
(1 |
) |
|
|
(4 |
) |
Net income (loss) |
|
792 |
|
|
|
704 |
|
|
|
750 |
|
Less:
Net income (loss) attributable to non-controlling interests |
|
5 |
|
|
|
6 |
|
|
|
12 |
|
Net income (loss) attributable to
stockholders |
|
787 |
|
|
|
698 |
|
|
|
738 |
|
|
|
|
|
|
|
Earnings per share data: |
|
|
|
|
|
Net income
(loss) per common share attributable to stockholders in $ |
Basic |
$ |
3.06 |
|
|
$ |
2.69 |
|
|
$ |
2.81 |
|
Diluted |
$ |
3.01 |
|
|
$ |
2.67 |
|
|
$ |
2.79 |
|
|
|
|
|
|
|
Weighted
average number of shares of common stock
outstanding during the period (in thousands): |
Basic |
|
257,488 |
|
|
|
259,160 |
|
|
|
262,180 |
|
Diluted |
|
261,095 |
|
|
|
261,303 |
|
|
|
264,705 |
|
|
|
|
|
|
|
NXP SemiconductorsTable 2: Condensed
consolidated balance sheet (unaudited)
($ in millions) |
As of |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
ASSETS |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
4,042 |
|
|
$ |
3,863 |
|
|
$ |
3,759 |
|
Accounts receivable, net |
|
939 |
|
|
|
1,061 |
|
|
|
1,012 |
|
Inventories, net |
|
2,140 |
|
|
|
2,107 |
|
|
|
1,581 |
|
Other current assets |
|
495 |
|
|
|
416 |
|
|
|
351 |
|
Total current assets |
|
7,616 |
|
|
|
7,447 |
|
|
|
6,703 |
|
|
|
|
|
|
|
Non-current
assets: |
|
|
|
|
|
Other non-current assets |
|
2,236 |
|
|
|
2,136 |
|
|
|
1,940 |
|
Property, plant and equipment, net |
|
3,197 |
|
|
|
3,152 |
|
|
|
2,971 |
|
Identified intangible assets, net |
|
1,010 |
|
|
|
1,110 |
|
|
|
1,417 |
|
Goodwill |
|
9,937 |
|
|
|
9,950 |
|
|
|
9,909 |
|
Total non-current assets |
|
16,380 |
|
|
|
16,348 |
|
|
|
16,237 |
|
|
|
|
|
|
|
Total assets |
|
23,996 |
|
|
|
23,795 |
|
|
|
22,940 |
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable 1) |
|
959 |
|
|
|
967 |
|
|
|
1,114 |
|
Restructuring liabilities-current |
|
16 |
|
|
|
23 |
|
|
|
8 |
|
Other current liabilities 1) |
|
1,990 |
|
|
|
2,096 |
|
|
|
2,097 |
|
Short-term debt |
|
999 |
|
|
|
999 |
|
|
|
— |
|
Total current liabilities |
|
3,964 |
|
|
|
4,085 |
|
|
|
3,219 |
|
|
|
|
|
|
|
Non-current
liabilities: |
|
|
|
|
|
Long-term debt |
|
10,173 |
|
|
|
10,171 |
|
|
|
11,162 |
|
Restructuring liabilities |
|
3 |
|
|
|
8 |
|
|
|
12 |
|
Deferred tax liabilities |
|
44 |
|
|
|
40 |
|
|
|
39 |
|
Other non-current liabilities |
|
1,014 |
|
|
|
1,014 |
|
|
|
1,123 |
|
Total non-current liabilities |
|
11,234 |
|
|
|
11,233 |
|
|
|
12,336 |
|
|
|
|
|
|
|
Non-controlling interests |
|
310 |
|
|
|
305 |
|
|
|
279 |
|
Stockholders’ equity |
|
8,488 |
|
|
|
8,172 |
|
|
|
7,106 |
|
Total equity |
|
8,798 |
|
|
|
8,477 |
|
|
|
7,385 |
|
|
|
|
|
|
|
Total liabilities and equity |
|
23,996 |
|
|
|
23,795 |
|
|
|
22,940 |
|
|
|
|
|
|
|
1) We have
reclassified $420 million as of October 2, 2022 related to customer
programs previously presented in “Accounts payable” to “Other
current liabilities” to conform to current period
presentation. |
NXP SemiconductorsTable 3: Condensed
consolidated statement of cash flows (unaudited)
($ in millions) |
Three months ended |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
Cash flows from
operating activities: |
|
|
|
|
|
Net income (loss) |
$ |
792 |
|
|
$ |
704 |
|
|
$ |
750 |
|
Adjustments to reconcile net
income (loss) to net cash provided by (used for) operating
activities: |
|
|
|
|
|
Depreciation and amortization |
|
273 |
|
|
|
281 |
|
|
|
321 |
|
Share-based compensation |
|
103 |
|
|
|
102 |
|
|
|
89 |
|
Amortization of discount (premium) on debt, net |
|
1 |
|
|
|
— |
|
|
|
1 |
|
Amortization of debt issuance costs |
|
2 |
|
|
|
2 |
|
|
|
2 |
|
Net (gain) loss on sale of assets |
|
— |
|
|
|
(1 |
) |
|
|
(1 |
) |
Results relating to equity-accounted investees |
|
2 |
|
|
|
1 |
|
|
|
4 |
|
(Gain) loss on equity securities, net |
|
4 |
|
|
|
(6 |
) |
|
|
2 |
|
Deferred tax expense (benefit) |
|
(33 |
) |
|
|
(75 |
) |
|
|
(98 |
) |
Changes in operating
assets and liabilities: |
|
|
|
|
|
(Increase) decrease in receivables and other current assets |
|
40 |
|
|
|
(20 |
) |
|
|
(54 |
) |
(Increase) decrease in inventories |
|
(34 |
) |
|
|
(129 |
) |
|
|
(119 |
) |
Increase (decrease) in accounts payable and other liabilities |
|
(128 |
) |
|
|
(144 |
) |
|
|
275 |
|
(Increase) decrease in other non-current assets |
|
(49 |
) |
|
|
33 |
|
|
|
(37 |
) |
Exchange differences |
|
5 |
|
|
|
5 |
|
|
|
1 |
|
Other items |
|
10 |
|
|
|
3 |
|
|
|
8 |
|
Net cash provided by
(used for) operating activities |
|
988 |
|
|
|
756 |
|
|
|
1,144 |
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
Purchase of identified intangible assets |
|
(42 |
) |
|
|
(51 |
) |
|
|
(50 |
) |
Capital expenditures on property, plant and equipment |
|
(200 |
) |
|
|
(201 |
) |
|
|
(282 |
) |
Proceeds from the disposals of property, plant and equipment |
|
— |
|
|
|
1 |
|
|
|
1 |
|
Purchase of interests in businesses, net of cash acquired |
|
— |
|
|
|
— |
|
|
|
(22 |
) |
Purchase of investments |
|
(31 |
) |
|
|
(4 |
) |
|
|
(7 |
) |
Proceeds from the sale of investments |
|
— |
|
|
|
— |
|
|
|
— |
|
Net cash provided by
(used for) investing activities |
|
(273 |
) |
|
|
(255 |
) |
|
|
(360 |
) |
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
Dividends paid to common stockholders |
|
(262 |
) |
|
|
(264 |
) |
|
|
(223 |
) |
Proceeds from issuance of common stock through stock plans |
|
36 |
|
|
|
1 |
|
|
|
30 |
|
Purchase of treasury shares and restricted stock
unit withholdings |
|
(306 |
) |
|
|
(302 |
) |
|
|
(366 |
) |
Other, net |
|
(1 |
) |
|
|
— |
|
|
|
— |
|
Net cash provided by
(used for) financing activities |
|
(533 |
) |
|
|
(565 |
) |
|
|
(559 |
) |
|
|
|
|
|
|
Effect of changes in exchange
rates on cash positions |
|
(3 |
) |
|
|
(3 |
) |
|
|
(11 |
) |
Increase (decrease) in cash
and cash equivalents |
|
179 |
|
|
|
(67 |
) |
|
|
214 |
|
Cash and cash equivalents at
beginning of period |
|
3,863 |
|
|
|
3,930 |
|
|
|
3,545 |
|
Cash and cash
equivalents at end of period |
|
4,042 |
|
|
|
3,863 |
|
|
|
3,759 |
|
|
|
|
|
|
|
Net cash paid during the period for: |
|
|
|
|
|
Interest |
|
38 |
|
|
|
86 |
|
|
|
39 |
|
Income taxes, net of
refunds |
|
165 |
|
|
|
239 |
|
|
|
160 |
|
Net gain (loss) on sale of assets: |
|
|
|
|
|
Cash
proceeds from the sale of assets |
|
— |
|
|
|
1 |
|
|
|
1 |
|
Non-cash investing activities: |
|
|
|
|
|
Non-cash capital expenditures |
|
167 |
|
|
|
165 |
|
|
|
176 |
|
NXP SemiconductorsTable 4: Financial
Reconciliation of GAAP to non-GAAP Results (unaudited)
($ in millions) |
Three months ended |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
Revenue |
$ |
3,434 |
|
|
$ |
3,299 |
|
|
$ |
3,445 |
|
GAAP Gross
Profit |
$ |
1,965 |
|
|
$ |
1,881 |
|
|
$ |
1,967 |
|
PPA Effects |
|
(13 |
) |
|
|
(14 |
) |
|
|
(15 |
) |
Share-based compensation |
|
(14 |
) |
|
|
(13 |
) |
|
|
(12 |
) |
Other incidentals |
|
(18 |
) |
|
|
(18 |
) |
|
|
(5 |
) |
Non-GAAP Gross
Profit |
$ |
2,010 |
|
|
$ |
1,926 |
|
|
$ |
1,999 |
|
GAAP Gross
margin |
|
57.2 |
% |
|
|
57.0 |
% |
|
|
57.1 |
% |
Non-GAAP Gross
margin |
|
58.5 |
% |
|
|
58.4 |
% |
|
|
58.0 |
% |
GAAP Research and development |
$ |
(601 |
) |
|
$ |
(589 |
) |
|
$ |
(548 |
) |
Restructuring |
|
4 |
|
|
|
— |
|
|
|
— |
|
Share-based compensation |
|
(53 |
) |
|
|
(51 |
) |
|
|
(45 |
) |
Other incidentals |
|
(2 |
) |
|
|
(1 |
) |
|
|
(1 |
) |
Non-GAAP Research and development |
$ |
(550 |
) |
|
$ |
(537 |
) |
|
$ |
(502 |
) |
GAAP Selling, general and administrative |
$ |
(294 |
) |
|
$ |
(274 |
) |
|
$ |
(289 |
) |
PPA effects |
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
Share-based compensation |
|
(36 |
) |
|
|
(38 |
) |
|
|
(32 |
) |
Other incidentals |
|
(4 |
) |
|
|
(2 |
) |
|
|
(27 |
) |
Non-GAAP Selling, general and administrative |
$ |
(253 |
) |
|
$ |
(234 |
) |
|
$ |
(228 |
) |
GAAP amortization of acquisition-related intangible assets |
$ |
(71 |
) |
|
$ |
(81 |
) |
|
$ |
(131 |
) |
PPA effects |
|
(71 |
) |
|
|
(81 |
) |
|
|
(131 |
) |
Non-GAAP amortization of acquisition-related intangible assets |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
GAAP Other income (expense) |
$ |
(7 |
) |
|
$ |
— |
|
|
$ |
2 |
|
Other incidentals |
|
(3 |
) |
|
|
— |
|
|
|
— |
|
Non-GAAP Other income (expense) |
$ |
(4 |
) |
|
$ |
— |
|
|
$ |
2 |
|
GAAP Operating income
(loss) |
$ |
992 |
|
|
$ |
937 |
|
|
$ |
1,001 |
|
PPA effects |
|
(85 |
) |
|
|
(95 |
) |
|
|
(148 |
) |
Restructuring |
|
4 |
|
|
|
— |
|
|
|
— |
|
Share-based compensation |
|
(103 |
) |
|
|
(102 |
) |
|
|
(89 |
) |
Other incidentals |
|
(27 |
) |
|
|
(21 |
) |
|
|
(33 |
) |
Non-GAAP Operating
income (loss) |
$ |
1,203 |
|
|
$ |
1,155 |
|
|
$ |
1,271 |
|
GAAP Operating
margin |
|
28.9 |
% |
|
|
28.4 |
% |
|
|
29.1 |
% |
Non-GAAP Operating
margin |
|
35.0 |
% |
|
|
35.0 |
% |
|
|
36.9 |
% |
GAAP Financial income
(expense) |
$ |
(75 |
) |
|
$ |
(74 |
) |
|
$ |
(98 |
) |
Foreign exchange gain (loss) |
|
(3 |
) |
|
|
(3 |
) |
|
|
(2 |
) |
Other financial income (expense) |
|
(7 |
) |
|
|
2 |
|
|
|
(5 |
) |
Non-GAAP Financial
income (expense) |
$ |
(65 |
) |
|
$ |
(73 |
) |
|
$ |
(91 |
) |
GAAP Income tax
benefit (provision) |
$ |
(123 |
) |
|
$ |
(158 |
) |
|
|
Income tax effect |
|
45 |
|
|
|
22 |
|
|
|
Non-GAAP Income tax
benefit (provision) |
$ |
(168 |
) |
|
$ |
(180 |
) |
|
|
GAAP Results relating
to equity-accounted investees |
$ |
(2 |
) |
|
$ |
(1 |
) |
|
|
Results relating to equity-accounted investees |
|
(2 |
) |
|
|
(1 |
) |
|
|
Non-GAAP Results
relating to equity-accounted investees |
$ |
— |
|
|
$ |
— |
|
|
|
GAAP Net income
(loss) |
$ |
792 |
|
|
$ |
704 |
|
|
|
Less: Net income (loss)
attributable to non-controlling interests |
|
5 |
|
|
|
6 |
|
|
|
GAAP Net income (loss)
attributable to stockholders |
$ |
787 |
|
|
$ |
698 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net income (loss)
attributable to stockholders |
$ |
787 |
|
|
$ |
698 |
|
|
|
PPA Effects |
|
(85 |
) |
|
|
(95 |
) |
|
|
Restructuring |
|
4 |
|
|
|
— |
|
|
|
Share-based compensation |
|
(103 |
) |
|
|
(102 |
) |
|
|
Other incidentals |
|
(27 |
) |
|
|
(21 |
) |
|
|
Other adjustments |
|
33 |
|
|
|
20 |
|
|
|
Non-GAAP Net income
(loss) attributable to stockholders |
$ |
965 |
|
|
$ |
896 |
|
|
|
|
|
|
|
|
|
GAAP Diluted earnings
per share |
$ |
3.01 |
|
|
$ |
2.67 |
|
|
|
Non-GAAP Diluted
earnings per share |
$ |
3.70 |
|
|
$ |
3.43 |
|
|
|
|
|
|
|
|
|
NXP SemiconductorsTable 5: Adjusted
EBITDA and Free Cash Flow (unaudited)
($ in millions) |
Three months ended |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
GAAP Net income (loss) |
$ |
792 |
|
|
$ |
704 |
|
|
$ |
750 |
|
Reconciling items to EBITDA (Non-GAAP) |
|
|
|
|
|
Financial (income) expense |
|
75 |
|
|
|
74 |
|
|
|
98 |
|
(Benefit) provision for income taxes |
|
123 |
|
|
|
158 |
|
|
|
149 |
|
Depreciation |
|
163 |
|
|
|
162 |
|
|
|
156 |
|
Amortization |
|
110 |
|
|
|
119 |
|
|
|
165 |
|
EBITDA (Non-GAAP) |
$ |
1,263 |
|
|
$ |
1,217 |
|
|
$ |
1,318 |
|
Reconciling items to
adjusted EBITDA (Non-GAAP) |
|
|
|
|
|
Results of equity-accounted investees |
|
2 |
|
|
|
1 |
|
|
|
4 |
|
Restructuring |
|
(4 |
) |
|
|
— |
|
|
|
— |
|
Share-based compensation |
|
103 |
|
|
|
102 |
|
|
|
89 |
|
Other incidental items |
|
27 |
|
|
|
21 |
|
|
|
33 |
|
Adjusted EBITDA (Non-GAAP) |
$ |
1,391 |
|
|
$ |
1,341 |
|
|
$ |
1,444 |
|
Trailing twelve month
adjusted EBITDA (Non-GAAP) |
$ |
5,384 |
|
|
$ |
5,437 |
|
|
$ |
5,299 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions) |
Three months ended |
|
October 1, 2023 |
|
July 2, 2023 |
|
October 2, 2022 |
Net cash provided by (used for) operating
activities |
$ |
988 |
|
|
$ |
756 |
|
|
$ |
1,144 |
|
Net
capital expenditures on property, plant and equipment |
|
(200 |
) |
|
|
(200 |
) |
|
|
(281 |
) |
Non-GAAP free cash flow |
$ |
788 |
|
|
$ |
556 |
|
|
$ |
863 |
|
Trailing twelve month non-GAAP free cash flow |
$ |
2,568 |
|
|
$ |
2,643 |
|
|
$ |
2,510 |
|
Trailing twelve month
non-GAAP free cash flow as percent of
Revenue |
|
20 |
% |
|
|
20 |
% |
|
|
19 |
% |
|
|
|
|
|
|
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