NXP Revenues Down Slighting but Company Optimistic About Product Portfolio Investments
NXP Semiconductors N.V. reported financial results for the second quarter of 2019, ended June 30, 2019. The company posted revenues of $2.2 billion slightly above the midpoint of its guidance and reported an improvement in operating profitability above the high-end of its guidance range. The revenue was down 3% year-on-year.
NXP's GAAP gross margin was 51.9%, and its GAAP operating margin was 7.1%. The company's non-GAAP gross margin was 53.3%, and its non-GAAP operating margin was 28.9%.
The largest portion of the revenue, $1.036 billion came from automotive. Industrial and IoT made up the next largest part of its revenue for the quarter at $390 million, mobile-related products contributed $297 million and sales of communications, infrastructure, & other added $499 million to the total revenue for the second quarter of 2019.
At the end of May 2019, NXP reported that it entered into a definitive agreement to acquire Marvell's Wireless Connectivity portfolio in an all-cash asset transaction valued at $1.76 billion.
"NXP delivered revenue of $2.2 billion during the second quarter. With sales slightly better than the midpoint of our guidance, and good expense control, we successfully delivered improved operating profitability above the high end of our guidance range. Additionally, during the quarter, we returned $716 million to our shareholders consistent with our long-term capital return policy," Richard Clemmer, NXP CEO said.
"Looking forward, we continue to be optimistic that our product portfolio investments are addressing our customers' long-term requirements, while in the short-term, the global demand environment has generally not improved," Clemmer said.
NXP expects revenues for the third quarter to stay the same or rise slightly above its second-quarter levels. The company's guidance for revenue in the third quarter of 2019 is from $2.21 billion to $2.27 billion for an increase of up to 2% compared to the previous quartered and a decrease of up to 10% compared to the second quarter of 2018. Gross profit is expected to be between $1.18 billion and $1.196 billion. Operating income is forecast to be from $167 million to $193 million.