NXP adjusts strategy: Reduce shipments in Q3, focus on high value-added markets

Chipmaker NXP recently released third-quarter results that beat expectations. In addition, they provided fourth-quarter profit guidance that was also higher than Wall Street's expectations, mainly due to the resilience of the automotive market and stable industrial demand, which

According to financial report data, revenue in the third quarter reached $3.43 billion, slightly higher than analysts' expectations, which had been expected to be $3.41 billion. However, adjusted free cash flow (FCF) in the third quarter was $788 million.

From a business segment perspective, NXP's automotive business achieved revenue of US$18.9 billion in the third quarter, a year-on-year increase of 5%. However, the industrial and IoT business revenue was US$607 million, a year-on-year decrease of 15%

NXP has previously stated that demand for its automotive products is very strong in various markets around the world, and the high demand for Apple's iPhone has also played a positive role in the company's performance. The communication chips produced by the company are widely used in smartphones, supporting mobile payments, etc.

Although the current demand for chips in the automotive industry is still strong, this is a good opportunity for the semiconductor industry, but it also brings some challenges. Sources say that although the current demand for chips in the automotive industry is still strong, chip manufacturers

NXP CEO Kurt Sievers said on the earnings call that the company is intentionally reducing shipments of automotive business products to mitigate the risk of inventory inflation. NXP is working with customers to help them reduce inventory rather than blindly execute

Looking ahead, the company expects fourth-quarter non-GAAP revenue in the range of $3.3 billion to $3.5 billion, compared with analysts' expectations of $3.43 billion. Adjusted profit per share will be in the range of $3.44 to $3.86.

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