HomeMost PopularNXPI Q3 Earnings Preview: What Investors Should Expect for the Stock Performance

NXPI Q3 Earnings Preview: What Investors Should Expect for the Stock Performance

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NXP Semiconductors Set to Reveal Q3 2024 Earnings—What to Expect

NXP Semiconductors NXPI is set to announce its third-quarter 2024 financial results after the market closes on November 4.

For this quarter, NXPI projects revenues between $3.15 billion and $3.35 billion. The Zacks Consensus Estimate for revenues stands at $3.25 billion, showing a predicted decline of 5.3% year-over-year.

In terms of earnings, NXP Semiconductors expects non-GAAP earnings per share (EPS) in a range of $3.21 to $3.63. The consensus estimate for EPS is currently $3.43, which has remained unchanged over the past two months and suggests a 7.3% decrease from the prior year.

Looking at NXP’s recent performance, the company beat the Zacks Consensus Estimate in three out of the last four quarters, with an average surprise rate of 1.8%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Key Factors Influencing NXPI’s Performance

NXP Semiconductors’ upcoming results may reflect strong demand in its Industrial and Internet of Things (IoT) sectors, particularly driven by activity in China and across the Asia Pacific region. Additionally, robust sales in the Mobile market are anticipated to positively impact revenues.

The introduction of the Trimension SR250—a unique single-chip solution for the Industrial and IoT markets—might also contribute to better sales this quarter due to its advanced processing capabilities combined with secure ranging features.

Our model estimates that NXPI’s Industrial and IoT revenues will reach $620 million, representing a modest 2.1% increase compared to last year. For the Mobile market, we project revenues of $394 million, reflecting a growth of 4.5% year-over-year.

NXP Semiconductors N.V. Price and EPS Surprise

NXP Semiconductors N.V. Price and EPS Surprise

NXP Semiconductors N.V. price-eps-surprise | NXP Semiconductors N.V. Quote

However, challenges loom for NXPI as continued issues in the Automobile and Communications Infrastructure sectors may dampen performance. Ongoing inventory corrections at select Tier 1 auto customers are likely to have negatively impacted sales this quarter.

The communications infrastructure market is also grappling with reduced base station deployments worldwide and a rapid shift towards gallium nitride products, which have added pressure on NXPI. Compounding these issues are broader economic pressures, geopolitical tensions, and high inflation, all of which are expected to affect customer IT spending.

Our projections indicate that Automotive revenues will be about $1.82 billion, marking a 3.6% decline from the previous year. For the Communications Infrastructure and Other segments, we anticipate revenues of $414.3 million, down 25.9% year-over-year.

Earnings Expectations for NXPI

The Zacks model suggests that a positive Earnings ESP combined with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) generally boosts the likelihood of beating earnings estimates. Unfortunately, NXPI is currently not in that position.

NXPI has an Earnings ESP of 0.00% and holds a Zacks Rank of 4 (Sell). To find stocks with better prospects, you can utilize the Earnings ESP Filter.

Promising Stocks to Watch

Here are some stocks that may have the right setup to surpass earnings expectations in this reporting cycle:

Arista Networks ANET shows an Earnings ESP of +0.72% and carries a Zacks Rank of 1. Its shares have increased by 70.6% year to date and are expected to announce their third-quarter 2024 results on November 7.

The consensus estimate for ANET’s third-quarter earnings is $2.09 per share, which is up a penny from two months ago and indicates a 14.2% improvement from the same quarter last year.

Lyft LYFT, meanwhile, has an Earnings ESP of +5.00% and is rated as a Zacks Rank 2 stock.

Despite a 7.2% year-to-date decline, LYFT is set to release its third-quarter 2024 results on November 6. The current consensus estimate for LYFT’s earnings stands at 20 cents per share, a slight increase but a drop of 16.7% compared to last year.

Meta Platforms META also has a positive outlook with an Earnings ESP of +1.97% and a Zacks Rank of 2. META shares have appreciated by 67.7% this year, and they will report their third-quarter results on October 30.

The expectation for META’s third-quarter earnings is $5.19 per share, slightly higher than two months ago, suggesting an 18.2% jump compared to last year’s earnings.

Zacks Highlights the Top Semiconductor Stock

A standout in the semiconductor sector, this company is considerably smaller than NVIDIA, which surged over 800% since our recommendation. However, it possesses significant potential for future growth.

With strong earnings potential and a growing consumer base, it is well-positioned to meet the soaring demand in Artificial Intelligence, Machine Learning, and the Internet of Things. Global semiconductor manufacturing is forecasted to rise from $452 billion in 2021 to $803 billion by 2028.

Want the latest recommendations from Zacks Investment Research? Download our free report titled “5 Stocks Set to Double” for insights.

NXP Semiconductors N.V. (NXPI) : Free Stock Analysis Report

Arista Networks, Inc. (ANET) : Free Stock Analysis Report

Lyft, Inc. (LYFT) : Free Stock Analysis Report

Meta Platforms, Inc. (META) : Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.

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