NXP Semiconductors (NXPI) experienced a notable decline of over 5% in premarket trading following the release of its quarterly financial results, which did not meet the expectations of investors, particularly in its Automotive segment.
In its fourth quarter earnings report, NXP disclosed adjusted profits of $3.35 per share, which exceeded Wall Street’s forecast of $3.31 per share. The company reported total revenue of $3.34 billion, slightly above analyst expectations of $3.3 billion. Despite these positive earnings figures, the company’s Automotive revenue growth raised concerns among investors.
“Our execution throughout 2025 has been effective, despite a challenging first half. We maintained operational discipline while progressing in our strategic priorities related to software-defined vehicles and physical AI,” commented Rafael Sotomayor, NXP’s CEO.
The Automotive segment, which constitutes more than half of NXP’s overall revenue, posted growth of only 5% year-over-year. This marks a slowdown from the 6% growth reported in the previous quarter. The segment earned $1.8 billion in the fourth quarter, which fell short of market expectations that had anticipated revenue of $1.9 billion.
In contrast, other divisions within the company demonstrated robust performance. The Industrial and Internet of Things unit saw a significant increase with 24% annual revenue growth, amounting to $640 million. The Mobile segment also showed strong results, reporting a 22% revenue increase, bringing in $485 million. However, Communication Infrastructure faced challenges, experiencing an 18% decline in revenue on a yearly basis, totaling $334 million.
Looking ahead, NXP has provided a first-quarter revenue forecast of $3.15 billion at the midpoint, along with diluted earnings per share of $4.21. These projections are above analysts’ expectations of $3.09 billion in revenue and $2.95 per share earnings, as reported by S&P Global Market Intelligence.
