NXP Semiconductors N.V. NXPI delivered first-quarter 2024 non-GAAP earnings of $3.24 per share, which outpaced the Zacks Consensus Estimate by 1.9%. The figure increased 1.6% year over year.
Revenues of $3.13 billion missed the Zacks Consensus Estimate by 0.02%. The figure rose 0.2% from the year-ago level.
Strong momentum across the Industrial & IoT, and Mobile end markets contributed well.
NXPI has gained 10.9% in the year-to-date period, outperforming the industry’s growth of 3%.
However, the company witnessed sluggishness in the Automotive, and Communication Infrastructure & Others markets.
NXP Semiconductors N.V. Price, Consensus and EPS Surprise
NXP Semiconductors N.V. price-consensus-eps-surprise-chart | NXP Semiconductors N.V. Quote
End-Market Detail
Automotive generated $1.804 billion in revenues (58% of the total revenues), reflecting a year-over-year decrease of 1%. The figure surpassed the Zacks Consensus Estimate of $1.803 billion.
Revenues from Industrial & IoT were $574 million (18% of the total revenues), up 14% from the prior-year quarter. The reported figure lagged the consensus mark of $582 million.
Revenues from Mobile were $349 million (11% of the total revenues), up 34% from the year-ago period. The figure beat the Zacks Consensus Estimate of $344 million.
Communication Infrastructure & Others generated $399 million in revenues (13% of the total revenues), down 25% year over year. The reported figure was in line with the consensus mark.
Operating Results
The non-GAAP gross margin was 58.2%, which was flat year over year.
Research and development (R&D) expenses were $564 million, down 2.2% year over year. Selling, general and administrative (SG&A) expenses increased 9.3% year over year to $306 million. As a percentage of revenues, R&D expenses contracted 50 basis points (bps) year over year to 18%, while SG&A expenses expanded 80 bps year over year to 9.8%.
The non-GAAP operating margin of 34.5% for the reported quarter contracted 30 bps from the prior-year period.
Balance Sheet & Cash Flow
As of Mar 31, 2024, the cash and cash equivalent, and short-term deposits balance was $3.3 billion, down from $4.27 billion as of Dec 31, 2023.
The long-term debt was $10.178 billion at the end of the quarter under review compared with $10.175 billion at the end of the last reported quarter.
NXPI generated a cash flow of $851 million in the first quarter of 2024, down from $1.14 billion in the previous quarter.
The company’s capex investment was $224 million in the reported quarter. NXPI generated a free cash flow of $627 million in the quarter.
During the first quarter, the company made dividend payments of $261 million and repurchased shares worth $303 million.
Guidance
For second-quarter 2024, NXP Semiconductors expects revenues of $3.025-$3.225 billion, indicating a year-over-year fall of 5% at the mid-point. The Zacks Consensus Estimate for revenues is pegged at $3.12 billion.
It expects the non-GAAP gross margin between 58% and 59%. The non-GAAP operating margin is anticipated between 33.1% and 35%.
The company anticipates non-GAAP earnings of $3.00-$3.41 per share. The consensus estimate for the same is pegged at $3.15.
Zacks Rank & Stocks to Consider
NXP Semiconductors currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader technology sector are Arista Networks ANET, Dell Technologies DELL and Badger Meter BMI, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Arista Networks have gained 4.2% in the year-to-date period. The long-term earnings growth rate for ANET is 17.48%.
Shares of Dell Technologies have gained 52.3% in the year-to-date period. The long-term earnings growth rate for DELL is projected at 12%.
Shares of Badger Meter have gained 17.5% in the year-to-date period. The long-term earnings growth rate for BMI is 15.57%.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s an American AI company that’s riding low right now, but it has rounded up clients like BMW, GE, Dell Computer, and Bosch. It has prospects for not just doubling but quadrupling in the year to come. Of course, all our picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock And 4 Runners Up
Badger Meter, Inc. (BMI) : Free Stock Analysis Report
Dell Technologies Inc. (DELL) : Free Stock Analysis Report
NXP Semiconductors N.V. (NXPI) : Free Stock Analysis Report
Arista Networks, Inc. (ANET) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
