Nxp Semiconductors N.v. · NASDAQ:NXPI
Nxp Semiconductors — Q1 2022 Earnings Presentation
25 slides from Nxp Semiconductors's earnings presentation, May 2022
Slide 1: NXP Investor Presentation First Quarter 2022
NXP Investor Presentation First Quarter 2022 May 2022 SECURE CONNECTIONS FOR A SMARTER WORLD
Slide 2: Forward Looking Statements
F O RWAR D L O O K I N G S TAT E M E N T S This presentation or the subsequent discussion period includes forward-looking statements which include statements regarding NXP’s business strategy, financial condition, results of operations, market data and expectations, outlooks, projections, estimates,
Slide 3: NXP Investment Thesis
NXP Investment Thesis Market leader with Proven financial model with Reliable capital return policy of strong revenue growth resilient profitability robust free cash flow 2
Slide 4: NXP's Unrivaled Technology Portfolio for the Secure Edge
NXP’s Unrivaled Technology Portfolio for the Secure Edge SENSE THINK CONNECT ACT Everything Everything Everything Everything Aware Smart Connected Efficient Everything safe and secure Easy to implement scalable system solutions 3
Slide 5: NXP Addresses Major End Markets
NXP Addresses 4 Major End Markets Automotive Industrial & IoT Safety, Electrification and Driver Interaction Edge Processing, Connectivity and Security System solutions innovation with OEMs Processing needs are transforming markets Increased content drives revenue growth Scalable solutions as a diff
Slide 6: Accelerating Profitable Growth to 8-12% CAGR
Accelerating Profitable Growth to 8-12% CAGR 1.2,3,4 Communication Automotive Industrial & IoT Mobile Infrastructure 50% of Total 22% of Total 13% of Total 16% of Total +9 to 14% 3–yr. CAGR +9 to 14% 3–yr. CAGR +8 to 10% 3–yr. CAGR +2 to 6% 3–yr. CAGR Leader in sensing, processing Leader in connecte
Slide 7: Secular Growth Drivers Expected to Scale Rapidly
Secular Growth Drivers Expected to Scale Rapidly 1,2,3,4 NXP 2021 Revenue NXP Revenue Growth by End-market Exposure by Business Type ~$15.0B Accelerated 50% ~$6.0B Growth Drivers $11.1B Automotive 20-25% $9.4B 2021-24 CAGR ~$3.0B $1.6B ~$9.0B High RMS Core $7.8B ~$8.0B ~5% 2021-24 CAGR 13% Mobile 22
Slide 8: Accelerating Secular Profitable Revenue Growth
Accelerating Secular Profitable Revenue Growth 1,2,3,4 Automotive Industrial & IoT 9 - 14% CAGR 9 – 14% CAGR ~$7.7B $5.5B ~20% CAGR ~$3.3B $2.4B ~25% CAGR ~6% CAGR ~5% CAGR 2021 2024E 2021 2024E Mobile Comm. Infrastructure 8 - 10% CAGR 2 - 6% CAGR ~$1.8B ~$2.0B $1.4B $1.8B ~70% CAGR ~15% CAGR ~4% CA
Slide 9: NXP End Market Relative Market Share
NXP End Market Relative Market Share (“RMS”) 1,2 '21 AUTOMOTIVE '21 INDUSTRIAL & IOT True Leader Competitive '21 TOTAL NXP > 1.5x True Leader > 1.5x 0.5 - 1.0x Focused Leader 1.0 - Contender 1.5x <0.5x True Leader Focused Leader 1.0 - 1.5x Competitive Contender > 1.5x 0.5 - 1.0x <0.5x '21 MOBILE '21
Slide 10: Diverse End-Customer Base with High Barriers to Entry
Diverse End-Customer Base with High Barriers to Entry 1,2 1. Reflects 2021 sales through all channels 2. Reflects spin out of Vitesco Technologies from Continental AG 9
Slide 11: Driving Profitable Growth in Excess of Addressable Market
Driving Profitable Growth in Excess of Addressable Market 1,2,3 As Reported Revenue Non-GAAP Gross Profit / Non-GAAP Gross Margin Up 6% 3-yr. CAGR ($B) Up 8% 3-yr. CAGR ($B) 56.1% 52.9% 53.5% 51.1% $9.4 $8.9 $8.6 $11.1 $5.0 $4.7 $4.4 $6.2 2018 2019 2020 2021 2018 2019 2020 2021 Non-GAAP Operating Pr
Slide 12: Annual Revenue by End Market ($B)
Annual Revenue by End Market ($B) 1 Automotive Up 7% 3-yr. CAGR ($B) Industrial & IoT Up 10% 3-yr. CAGR ($B) $4.5 $4.2 $3.8 $5.5 $1.8 $1.6 $1.8 $2.4 2018 2019 2020 2021 2018 2019 2020 2021 Mobile Up 7% 3-yr. CAGR ($B) Communication Infrastructure & Other Down 1% 3-yr. CAGR ($B) $1.2 $1.2 $1.2 $1.4 $
Slide 13: Recent Quarterly Business Trends
Recent Quarterly Business Trends 1,2 As Reported Revenue ($M) Non-GAAP Gross Profit / Non-GAAP Gross Margin 57.6% 56.5% 57.3% 54.2% 56.1% 2,567 2,596 2,861 3,039 3,136 1,392 1,456 1,617 1,740 1,807 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Non-GAAP Operating Profit / Non-GAAP Opera
Slide 14: Quarterly Revenue by End Market ($M)
Quarterly Revenue by End Market ($M) 1 Automotive 1% Q-Q Industrial & IoT 27% Y-Y 3% Q-Q 19% Y-Y $1,229 $1,262 $1,455 $1,547 $1,557 $571 $571 $607 $661 $682 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Mobile Communication Infrastructure & Other 9% Q-Q 7% Q-Q 18% Y-Y 16% Y-Y $346 $347
Slide 15: Debt Summary End of 1Q22
Debt Summary End of 1Q22 1,2 Sr. Sr. 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 Unsecured Unsecured Credit Facility Notes Notes Notes Notes Notes Not
Slide 16: Working Capital Ratios
Working Capital Ratios 1,2 DSO DPO 30 35 31 28 27 79 92 83 87 93 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 DIO Cash Conversion Cycle 81 88 85 83 89 32 31 33 24 23 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 DSO = (91.25 x AR) / Revenue DIO = (91.25 x Inventory) / CO
Slide 17: Guidance for the Second Quarter of 2022
Guidance for the Second Quarter of 2022 1-6 GAAP Reconciliation Non-GAAP Low Mid High Low Mid High Total Revenue 3,175 3,275 3,375 3,175 3,275 3,375 Q-Q 1% 4% 8% 1% 4% 8% Y-Y 22% 26% 30% 22% 26% 30% Gross Profit 1,776 1,850 1,924 (38) 1,814 1,888 1,962 Gross Margin 55.9% 56.5% 57.0% 57.1% 57.6% 58.1
Slide 18: Updated Financial Model
Updated Financial Model (1,2,3) 2021 – 2024E NXP growth +8 to 12% Non-GAAP gross margin 55 to 58% Non-GAAP R&D ~16% Non-GAAP SG&A ~7% Non-GAAP operating margin 32 to 36% Non-GAAP cash taxes ‘22:~15%; ’23; ~18%; ’24; ~18% Non-controlling interest $35M to $45M Net capex 6 to 8% Stock based compensatio
Slide 19: Annual Financial Reconciliation (GAAP to non-GAAP)
Annual Financial Reconciliation (GAAP to non-GAAP) 1 ($ in millions, unless otherwise stated) 2018 2019 2020 2021 Total Revenue 9,407 8,877 8,612 11,063 GAAP Gross Profit 4,851 4,618 4,235 6,067 Gross profit adjustments (129) (131) (165) (138) Non - GAAP Gross Profit 4,980 4,749 4,400 6,205 GAAP Gro
Slide 20: Annual Cash Flow Overview ($M)
Annual Cash Flow Overview ($M) 1 ($ in millions, unless otherwise stated) 2018 2019 2020 2021 Net cash provided by (used for) operating activities 4,369 2,373 2,482 3,077 Net cash provided by (used for) investing activities (522) (2,284) (418) (934) Net cash provided by (used for) financing activiti
Slide 21: Annual Adjusted EBITDA ($M)
Annual Adjusted EBITDA ($M) 1 ($ in millions, unless otherwise stated) 2018 2019 2020 2021 Net income (loss) 2,258 272 80 1,906 Reconciling items to adjusted net income Financial (income) expense 335 350 417 403 (Benefit) provision for income taxes 176 20 (83) 272 Depreciation 478 518 547 551 Amorti
Slide 22: Quarterly Financial Reconciliation (GAAP to non-GAAP)
Quarterly Financial Reconciliation (GAAP to non-GAAP) 1 Q1 Q2 Q3 Q4 Q1 Other Information for Q1 2022: ($ in millions, unless otherwise stated) 2021 2021 2021 2021 2022 • PPA effects: ($150M) Total Revenue 2,567 2,596 2,861 3,039 3,136 GAAP Gross Profit 1,355 1,422 1,583 1,707 1,777 • Restructuring:
Slide 23: Quarterly Cash Flow Overview ($M)
Quarterly Cash Flow Overview ($M) 1 Q1 Q2 Q3 Q4 Q1 ($ in millions, unless otherwise stated) 2021 2021 2021 2021 2022 Net cash provided by (used for) operating activities 732 636 924 785 856 Net cash provided by (used for) investing activities (181) (189) (248) (316) (329) Net cash provided by (used
Slide 24: Quarterly Adjusted EBITDA ($M)
Quarterly Adjusted EBITDA ($M) 1 Q1 Q2 Q3 Q4 Q1 ($ in millions, unless otherwise stated) 2021 2021 2021 2021 2022 Net income (loss) 364 406 526 610 666 Reconciling items to adjusted net income Financial (income) expense 87 100 93 123 105 (Benefit) provision for income taxes 40 65 95 72 114 Depreciat
Slide 25: NXP Investment Thesis
NXP Investment Thesis Market leader with Proven financial model with Reliable capital return policy of strong revenue growth resilient profitability robust free cash flow 24