NXP Semiconductors NXPI reported third-quarter 2024 non-GAAP earnings of $3.45 per share, beating the Zacks Consensus Estimate by 0.58%. The figure declined 7% year over year.
NXPI’s earnings beat the Zacks Consensus Estimate thrice and matched once, with the average surprise being 1.79%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
NXPI’s top line of $3.250 billion was in line with the midpoint of management’s guidance, down 5.4% year over year. The figure missed the Zacks Consensus Estimate of $3.251 billion by 0.04%.
NXPI’s better-than-expected figures in the Communication Infrastructure, Mobile and Automotive end markets were negated by increasing macroeconomic challenges in the Industrial & IoT market.
NXPI’s unimpressive top-line and bottom-line guidance for the fourth quarter, along with flat third-quarter performance, accompanied by a broader macro weakness is likely to affect the stock’s movement. NXPI shares were down more than 6% in pre-market trading following the results.
On a year-to-date basis, shares of NXPI have gained 3.2%, outperforming the Zacks Semiconductor - Analog and Mixed industry’s return of 2.6%.
NXPI’s Q3 2024 Details
Revenues from Automotive (56.3% of total revenues) in the third quarter were $1.829 billion, down 3.3% year over year. This figure surpassed the consensus mark of $1.812 billion.
Third-quarter revenues from Mobile (12.5% of total revenues) were $407 million, up 8% year over year. The figure surpassed the consensus mark of $396 million.
NXP Semiconductors N.V. Price, Consensus and EPS Surprise
NXP Semiconductors N.V. price-consensus-eps-surprise-chart | NXP Semiconductors N.V. Quote
Revenues from Communication Infrastructure & Others (13.9% of total revenues) in the third quarter were $451 million, down 19.3% from the year-ago reported figure. This figure surpassed the consensus mark of $417 million.
Revenues from Industrial & IoT (17.3% of total revenues) were $563 million, which declined 7.2% from the year-ago level and lagged the consensus mark of $627 million.
NXPI’s non-GAAP gross profit in the third quarter was $1.892 billion, down 6% year over year. The non-GAAP gross margin contracted 30 basis points (bps) on a year-over-year basis to 58.2%.
For the third quarter, non-GAAP operating income declined 4% year over year to $1.15 billion. However, operating margin expanded 50 bps to 35.5% from the year-ago quarter.
NXPI’s Balance Sheet & Cash Flow
As of Sept. 30, 2024, NXPI’s cash and cash equivalent, and short-term deposit balance was $3.12 billion, down from $3.26 billion as of June 30, 2024.
The long-term debt was $9.683 billion at the end of the quarter under review compared with $9.681 billion at the end of the last reported quarter.
Cash flow from operations was $779 million, up 2.4% from the previous quarter’s levels. The company’s capex investment was $186 million in the reported quarter. NXPI generated a free cash flow of $593 million in the third quarter.
In the third quarter, NXPI made dividend payments of $259 million and repurchased shares worth $305 million.
NXPI’s Q4 Guidance
For fourth-quarter 2024, NXPI expects revenues in the range of $3-$3.2 billion, indicating a decline of 6.9-14% year over year.
The Zacks Consensus Estimate is pegged at $3.39 billion, indicating a year-over-year decline of 1.01%.
NXPI expects adjusted earnings in the band of $2.93-$3.33 per share, suggesting a decline of 11.4-26.6% year over year.
The consensus mark for earnings is pinned at $3.66 per share, indicating a year-over-year decline of 1.35%.
Zacks Rank & Stocks to Consider
Currently, NXPI carries a Zacks Rank #4 (Sell) at present.
Shopify SHOP, Arista Networks ANET and Bilibili BILI are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector.
Shopify sports a Zacks Rank #1 (Strong Buy), while Arista Networks and Bilibili carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
SHOP’s shares have gained 0.7% year to date. It is set to report third-quarter 2024 results on Nov. 12.
ANET shares have gained 67.7% year to date. ANET is set to report its third-quarter 2024 results on Nov. 7.
BILI shares have surged 80.8% year to date. It is slated to release third-quarter 2024 results on Nov. 14.
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