Nxp Semiconductors N.v. · NASDAQ:NXPI

Nxp Semiconductors — Investor Presentation (July 2020)

20 slides from Nxp Semiconductors's investor presentation, July 2020

  1. Slide 1: NXP Investor Presentation Second Quarter 2020

    NXP Investor Presentation Second Quarter 2020 July 2020 SECURE CONNECTIONS FOR A SMARTER WORLD

  2. Slide 2: Forward-Looking Statement

    Forward-Looking Statement This document includes forward-looking statements which include statements regarding NXP’s business strategy, financial condition, results of operations, and market data, as well as any other statements which are not historical facts. By their nature, forward-looking statem

  3. Slide 3: NXP Investment Thesis

    NXP Investment Thesis Market Leader in Focused on Strong Growing Markets Profitable Growth Shareholder All Excess Cash Friendly Returned to Shareholders 2

  4. Slide 4: Secure Connections for the Smarter World… has Evolved

    Secure Connections for the Smarter World… has Evolved Preprocessing Focus Verticals Cloud IoT Edge Enabling Infrastructure Technologies Automotive Home Gateway Industrial Machine Controller Learning Authentication Auto Smart Industrial & IoT Processing Gateway City Mobile Connectivity Services Data

  5. Slide 5: NXP Addresses 4 Major End Markets

    NXP Addresses 4 Major End Markets Automotive Industrial & IoT ADAS + Electrification Fragmented customer base System solutions innovation with OEMs Processing needs are transforming markets Increased content drives growth Scalable solutions as a differentiator Mobile Communication Large mobile and a

  6. Slide 6: Focused Leadership – End Markets

    Focused Leadership – End Markets 1 NXP 2019 Revenue by End-market Exposure 2 Broad end market exposure • Long product life cycles • High barriers to entry 47% • Application expertise Automotive Recognized leadership in • Automotive 18% • MCU and application processors Industrial & 13% • Mobile trans

  7. Slide 7: NXP End Market Relative Market Share (RMS)

    NXP End Market Relative Market Share (“RMS”) 1,2 '19 AUTOMOTIVE '19 MOBILE Focused Contender Leader <0.5x 1.0 - 1.5x '19 TOTAL NXP Competitive 0.5 - 1.0x Focused Contender <0.5x True Leader > 1.5x Leader True Leader 1.0 - 1.5x > 1.5x True Leader > 1.5x Competitive '19 INDUSTRIAL & IOT '19 COMM INFRA

  8. Slide 8: Growth Opportunity Driven by Focus End Markets

    Growth Opportunity Driven by Focus End Markets 1 Growth by End Market 5-7% Percent Normalized Period Normalized End Market 2019 3-Yr CAGR 3-yr. CAGR Revenue Automotive 47% Up 7 to 10% $8.9B Industrial & IoT 18% Up 8 to 11% Mobile 13% Up 4 to 6% Comm. Infra. & Other 21% 0 to up 2% Total Up 5 - 7% 201

  9. Slide 9: Diverse Customer Base - Top 20 Customers > 40% of Revenue

    Diverse Customer Base - Top 20 Customers > 40% of Revenue 1 >25,000 Total Customers Automotive Mobile Comm. Infra. 8 1. Reflects 2019 sales through all channels

  10. Slide 10: Driving Profitable Growth in Excess of Addressable Market

    Driving Profitable Growth in Excess of Addressable Market 1,2,3 2 As Reported Revenue Down 2% 3-yr. CAGR ($B) Non-GAAP Gross Profit flat 3-yr. CAGR ($B) $9.5 $9.3 $9.4 $8.9 $4.8 $4.9 $5.0 $4.7 2016 2017 2018 2019 2016 2017 2018 2019 2,3 Non-GAAP EBIT Profit up 1% 3-yr. CAGR ($B) 2 Non-GAAP Free Cash

  11. Slide 11: Recent Quarterly Business Trends

    Recent Quarterly Business Trends 1,2 As Reported Revenue ($M) Non-GAAP Gross Margin 2,094 2,217 2,265 2,301 2,021 1,817 52.7% 53.3% 53.7% 54.2% 51.8% 49.1% Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Non-GAAP Operating Margin Non-GAAP Adj. EBITDA Margin 26.7% 28.9% 30.3%

  12. Slide 12: Revenue by End Market Trend ($M)

    Revenue by End Market Trend($M) 1 Automotive Industrial & IoT (32%) Q-Q (35%) Y-Y 16% Q-Q 12% Y-Y $1,036 $1,031 $1,048 $1,097 $994 $674 $368 $390 $426 $415 $376 $435 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Mobile Communication Infrastructure & Other 12% Q-Q (9%) Y-Y 3

  13. Slide 13: Debt Summary End of 2Q20

    Debt Summary End of 2Q20 1 Sr. Sr. Sr. Sr. Sr. Sr. Sr. Sr. Sr. Sr. Sr. Sr. Revolving Debt Instrument Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Credit Facility Notes Notes Notes Notes Notes Notes Notes Notes Notes Notes Not

  14. Slide 14: Working Capital Ratios

    Working Capital Ratios 1,2 DSO DPO 35 32 32 26 28 24 74 67 74 81 83 71 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 DIO(2) Cash Conversion Cycle 113 100 98 102 113 120 74 65 56 47 58 73 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 DSO = (91.25 x

  15. Slide 15: Guidance for the Third Quarter of 2020

    Guidance for the Third Quarter of 2020 1 GAAP Reconciliation Non-GAAP Low Mid High Low Mid High Total Revenue 1,900 2,000 2,100 1,900 2,000 2,100 Q-Q 5% 10% 16% 5% 10% 16% Y-Y -16% -12% -7% -16% -12% -7% Gross Profit 882 950 1,019 (30) 912 980 1,049 Gross Margin 46.4% 47.5% 48.5% 48.0% 49.0% 50.0% O

  16. Slide 16: Financial Model

    Financial Model 1 2018A – 2021E Focused Market Growth(1) 3 - 5% NXP Growth(1) 5 - 7% Non-GAAP Gross Margin 53 - 57% Non-GAAP R&D 14 - 16% Non-GAAP SG&A 6 - 8% Non-GAAP Operating Margin 31 - 34% Non-GAAP Operating Income Growth ~8 - 14% 15 1. 3 Year CAGR from 2018 actuals through 2021E internal NXP e

  17. Slide 17: Quarterly Financial Reconciliation (GAAP to non-GAAP)

    Quarterly Financial Reconciliation (GAAP to non-GAAP) 1 Q2 Q1 Q2 Other Information for Q2 2020: ($ in millions, unless otherwise stated) 2020 2020 2019 • PPA effects: ($402M) Total Revenue 1,817 2,021 2,217 GAAP Gross Profit 860 997 1,151 • Restructuring: ($8M) Gross profit adjustments (32) (50) (30

  18. Slide 18: Quarterly Cash Flow Overview ($M)

    Quarterly Cash Flow Overview ($M) 1 Q2 Q1 Q2 ($ in millions, unless otherwise stated) 2020 2020 2019 Net cash provided by (used for) operating activities 414 512 517 Net cash provided by (used for) investing activities (113) (37) (144) Net cash provided by (used for) financing activities 1,885 (431)

  19. Slide 19: Quarterly Adjusted EBITDA ($M)

    Quarterly Adjusted EBITDA ($M) 1 Q2 Q1 Q2 ($ in millions, unless otherwise stated) 2020 2020 2019 Net income (loss) (209) (13) 46 Reconciling items to adjusted net income Financial (income) expense 96 78 89 (Benefit) provision for income taxes (33) 2 21 Depreciation 136 133 128 Amortization 407 407

  20. Slide 20: Value Proposition

    Value Proposition Driving RMS Multiple High Solutions World-class Leadership Growth Markets Core Competency Expertise & Team Focused on RMS Profitable growth Resolving customer Customer focused > 1.5X pain-points passion to win Maximize Shareholder Value Strong cash flow generation 19

NXP Semiconductors — Investor Presentation (July 2020) on 6ix