(Reuters) – Chipmaker NXP Semiconductors said on Monday it expected first-quarter profit to beat its target and sales for the previous quarter also beat expectations, boosted by strength in the auto market, a major consumer of its technology. announced that it had surpassed
Netherlands-based NXP supplies chips and other technologies to the automotive, manufacturing, communications and connected devices sectors that increasingly rely on high-speed digital processing.
Light vehicle manufacturing increased 9% globally last year, reaching pre-pandemic production levels, according to an S&P Global report. Meanwhile, growth in the U.S. auto market last year was the highest since 2019.
The automotive consumer segment grew 5% in the fourth quarter and accounted for 56% of NXP's overall revenue in 2023.
NXP expects adjusted earnings per share in the range of $2.97 to $3.38 for the March quarter. The midpoint of the range is higher than the consensus estimate of $3.15 from three analysts, according to LSEG data.
However, due to expected weakness in the electric vehicle sector and the Chinese electronics market, the company's sales forecast was at the midpoint of $3.13 billion, lower than the forecast of $3.16 billion.
“We are navigating a soft landing by managing what is under our control, especially by limiting the overshipment of product to our customers,” said Kurt Sievers, NXP's president and chief executive officer. “I am doing so,” he said.
Revenue for the fourth quarter ended Dec. 31 was $3.42 billion, beating consensus estimates of $3.4 billion.
Nasdaq-listed NXP shares rose nearly 3% in after-bell trading. The stock closed up 2.8% on Monday.
