NXP Semiconductors N.V. (NXPI) delivered a mixed bag of results in its third-quarter earnings report, released after the market closed on Monday. While the company surpassed analysts’ expectations for earnings per share, its revenue matched estimates and reflected a decline from the same period last year. The company’s outlook for the fourth quarter also painted a cautious picture, citing macroeconomic headwinds.
NXP’s third-quarter earnings came in at $3.45 per share, topping the consensus estimate of $3.43. Revenue for the quarter reached $3.25 billion, aligning with analysts’ expectations but representing a decrease from the $3.43 billion reported in the same period last year. Despite the revenue dip, the company demonstrated strong profitability, reporting a non-GAAP gross margin of 58.2% and a non-GAAP operating margin of 35.5%. Cash flow from operations remained robust at $779 million, resulting in non-GAAP free cash flow of $593 million after deducting net capex investments of $186 million.
However, NXP’s outlook for the fourth quarter revealed concerns about the broader macroeconomic environment. The company anticipates revenue in the range of $3 billion to $3.2 billion, falling short of the $3.35 billion consensus estimate. Earnings are projected to be between $2.93 and $3.33 per share, also lagging behind the $3.64 estimate.
“NXP delivered quarterly revenue of $3.25 billion, in-line with our overall guidance. While we experienced some strength against our expectations in the Communication Infrastructure, Mobile and Automotive end markets, we were confronted with increasing macro-related weakness in the Industrial & IoT market. Our guidance for the fourth quarter reflects broader macro weakness especially in Europe and the Americas,” stated Kurt Sievers, NXP’s President and CEO.
The company’s cautious outlook, driven by macroeconomic headwinds, particularly in Europe and the Americas, contributed to a decline in NXP’s share price after hours. According to Benzinga Pro, NXPI shares were down 5.02% at $225 at the time of publication. Investors will be closely watching NXP’s conference call on Tuesday at 8:00 AM EST, where management will provide further details on the company’s performance and outlook.
