NXP says revenues dipped 3% in 1Q on COVID-19 impact

NXP
NXP saw a 3% revenue decline in the first quarter with CEO Richard Clemmer noting the need to watch auto and industrial chip demand. (NXP)

Netherlands-based NXP Semiconductors announced first quarter revenues of $2 billion on Monday, 3% less than the year ago quarter.

Uncertainties caused by COVID-19 on both demand and supply have been a constant refrain for semi makers during the first quarter earnings season, and NXP Semiconductors was no exception.

 However, some companies have reported a revenue boost, including Intel, which last week said it had a 23% revenue boost largely from data center and PC chip sales during the quarter.

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NXP revenues were in line with its April 7 projection, according to NXP CEO Richard Clemmer.  Income was down by 10% over the year ago quarter, reaching $502 million.  In early April, the company had revised estimates downward saying they reflected “a worse than anticipated impact from the COVID-19 pandemic.”

On Monday, Clemmer offered a short written statement prior to an earning call with analysts on Tuesday morning.

“We currently find ourselves navigating a challenging and very fluid environment,” Clemmer said. “We are working diligently with our direct and distribution partners to determine accurate projections of customer demand, especially within the global automotive and industrial markets,” he added. 

“Notwithstanding the current challenges, NXP continues to have the financial strength, the product portfolio and customer engagements to emerge strong from the current unpredictable environment.”

For the first quarter, NXP said auto and communications revenues were down 4% and 10% respectively compared to a year earlier. Mobile and industrial and IoT revenues were both up 2%.

For all of 2019, NXP had nearly $8.9 billion in revenue, almost tying for 10th place with Infineon Technologies. Last year’s revenues were 6% below revenues in 2018. The company reported 31,000 employees in 2017.

NXP launched in 2006 after Philips Semiconductors sold of an 80% stake to several private equity investors.  The name NXP derives from Next eXPerience.

In 2019, NXP acquired wireless connectivity products from Marvell.  Among its products, it makes near-field communications chipsets used in smartphones. Its chips are used in RFID tags and electronic passports and contactless cards used on transit systems.

The stock rose nearly 3% at market close on Monday, reaching $97.13. At its year high, it reached 137.83 on Feb. 12.

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