Increase of Quarterly Dividend Announced!
NXP Semiconductors has reported financial results for the fourth quarter and full year ended December 31, 2022.
“NXP delivered full-year 2022 revenue of $13.21 billion, an increase of 19 percent year-on-year, with revenue increasing across all of our focus end-markets. In the fourth quarter, revenue was $3.31 billion, an increase of 9 percent year-on-year, in line with the mid-point of our guidance range. In review, 2022 was a very good year for NXP, with strong execution resulting in record revenue, solid profit growth, and healthy free cash flow generation,” said Kurt Sievers, NXP President and Chief Executive Officer.
“Additionally, we experienced unprecedented year-on-year design win traction across the entire portfolio. From an end-market perspective, our automotive business performed very well, while in our consumer IoT and mobile businesses we experienced a softening demand environment through the second half of 2022. Accordingly, we have adopted a vigilant operational stance, aiming to improve service to those customers who continue to experience material shortages while managing the distribution channel inventory levels well below our long-term targets.”
Key Highlights for the Fourth Quarter and Full-year 2022
- Fourth Quarter revenue was $3.31 billion, up 9.0 percent year-on-year. Full-year revenue was $13.21 billion, up 19.4 percent year-on-year;
- Fourth Quarter GAAP gross margin was 57.1 percent, and GAAP operating margin was 29.6 percent. Full-year GAAP gross margin was 56.9 percent, and GAAP operating margin was 28.8 percent;
- Fourth Quarter non-GAAP gross margin was 58.0 percent, and non-GAAP operating margin was 36.5 percent. Full-year non-GAAP gross margin was 57.9 percent, and non-GAAP operating margin was 36.3 percent;
- Fourth Quarter cash flow from operations was $1,076 million, with net capex investments of $233 million, resulting in non-GAAP free cash flow of $843 million. Full-year cash flow from operations was $3,895 million, with net capex investments of $1,061 million, resulting in non-GAAP free cash flow of $2,834 million;
- During the fourth quarter of 2022, NXP repurchased 3.16 million shares for a total cost of $475 million and paid cash dividends of $221 million, returning $696 million to shareholders. On a trailing twelve month basis capital return to shareholders represented $2.24 billion or 79 percent of non-GAAP free cash flow;
Key Highlights in November 2022
On November 14, 2022, NXP announced its new analog front-end (N-AFE) family for high-precision data acquisition and condition monitoring systems for factory automation. The new N-AFE family helps enable the software-defined factory, making it easier for operators to configure a smart factory and adjust settings based on shifting market needs. Combined with NXP’s MCU and power management portfolios, the N-AFE devices expand the industrial system solution offering, while helping customers to accelerate development time and reduce time to market.
On November 15, 2022, NXP announced the new S32K39 series of automotive microcontrollers (MCUs) optimized for electric vehicle (EV) control applications. The S32K39 series include networking, security and functional safety capabilities to address the needs of zonal vehicle xEV architectures and software-defined vehicles.
On November 16, 2022, the NXP Board of Directors approved the payment of an interim dividend for the fourth quarter 2022 of $0.845 per ordinary share. The interim dividend was paid in cash on January 6, 2022 to shareholders of record as of December 15, 2022.
On November 25, 2022, MSCI upgraded NXP's ESG rating to "AAA" from "AA", driven by improvements in NXP’s corporate governance and conflict mineral management programs. Further, MSCI believes NXP leads peers in practices to mitigate risks associated with conflict mineral use in chip manufacturing.
Key Highlights in December 2022
On December 14, 2022, NXP announced new devices to expand the portfolio of end-to-end Matter solutions to simplify the development of IoT and industrial IoT solutions. The RW612 is the industry’s first tri-radio wireless MCU with concurrent, multi-protocol support for Wi-Fi® 6, Bluetooth® Low Energy 5.3 and 802.15.4, capable of supporting Thread or Zigbee. The K32W148 wireless MCU offers multi-protocol enablement across Thread, Bluetooth Low Energy 5.3, and Zigbee for devices such as smart plugs, smart lighting, and low-power smart devices and sensors.
Key HIghlights in January 2023
Beginning with the first quarter 2023 financial guidance, NXP will begin to apply an estimated annual tax rate to its GAAP and non-GAAP profit before tax.
On January 30, 2023, the NXP Board of Directors approved a 20 percent increase in the quarterly cash dividend to $1.014 per ordinary share. The interim dividend will be paid in cash on April 5, 2023 to shareholders of record as of March 15, 2023.
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