NXP Semiconductors (NXPI) Beats Q3 Revenue, Cites Cyclical Recovery Signs
Earnings Release Date: October 27, 2025
Key Points
Revenue: $3.17 billion (vs $3.25 billion Q3 FY24) — down 2% YoY, but up 8% QoQ, exceeding the midpoint of guidance.
GAAP EPS: $2.48 (vs $2.79 last year), down 11% YoY, but up 42% QoQ.
Non-GAAP EPS: $3.11 (vs $3.45), down 10% YoY, but up 14% QoQ.
Non-GAAP gross margin: 57.0% (vs 58.2% last year); Non-GAAP operating margin: 33.8% (vs 35.5% last year).
Cash flow from operations: $585 million.
Non-GAAP free cash flow (Q3): $509 million.
Capital return: $310 million in the quarter, representing 60.9% of non-GAAP free cash flow.
Against Street Expectations:
Revenue $3.17 B vs Guidance Midpoint (implied $2.92 B) → exceeded midpoint (Note: Guidance midpoint was based on Q2 2025 guidance from Q2 release, however the Q3 2025 actual revenue of $3.17B is compared to the $2.926B in Q2 2025, showing 8% sequential growth, and the press release explicitly states the revenue “exceeding the midpoint of our guidance.”).
Quarter Highlights
Automotive revenue: $1.837 B (flat YoY; +6% QoQ).
Industrial & IoT revenue: $579 M (+3% YoY; +6% QoQ).
Mobile revenue: $430 M (+6% YoY; +30% QoQ).
Comm. Infra. & Other revenue: $327 M (-27% YoY; +2% QoQ).
Capital Allocation: $310 million returned to shareholders via $54 million in share buybacks and $256 million in dividends. The board approved an interim dividend of $1.014 per ordinary share. An additional $100 million in share repurchases were executed via a 10b5-1 program after the end of the quarter, between September 29 and October 24, 2025.
Acquisitions/Divestitures: Closed the acquisition of Aviva Links for $243 million in cash, expanding NXP’s automotive networking solutions. Reached a definitive agreement to sell the MEMS sensors business line to STMicroelectronics for up to $950 million in cash. Received all regulatory approvals for the Kinara NPU acquisition.
Product: Announced the new 18-channel Li-ion battery cell controller BMx7318/7518 IC family for electric vehicle high-voltage battery management systems (HVBMS) and industrial energy storage systems (ESS).
CEO Statement
“NXP reported quarterly revenue of $3.17 billion, exceeding the midpoint of our guidance. We experienced broad-based sequential improvement across all regions and end markets. Our outlook reflects the strength of our company specific growth drivers and signs of a cyclical recovery. We remain focused on disciplined investment and portfolio enhancement to drive profitable growth, while maintaining control over the factors we can influence,” said Rafael Sotomayor, NXP President and incoming Chief Executive Officer.
Outlook and Guidance
Q4 FY25 Outlook (Midpoint):
Revenue: $3.300 B (Range: $3.200 B – $3.400 B), +4% QoQ at midpoint.
Non-GAAP gross margin: 57.5% (Range: 57.0% – 58.0%).
Non-GAAP operating margin: 34.6% (Range: 33.7% – 35.4%).
Non-GAAP EPS: $3.28 (Range: $3.07 – $3.49).
| Metric | Q3 FY25 | Q3 FY24 | YoY Change |
| Revenue | $3.173 B | $3.250 B | –2% |
| Gross Margin (Non-GAAP) | 57.0% | 58.2% | –120 bps |
| Operating Margin (Non-GAAP) | 33.8% | 35.5% | –170 bps |
| Net Income (Non-GAAP) | $790 M | $890 M | –11% |
| EPS (Non-GAAP) | $3.11 | $3.45 | –10% |
| Operating Cash Flow | $585 M | $779 M | –25% |
| Free Cash Flow (Q3) | $509 M | $593 M | –14% |
Capital Return
Financial Summary
Share repurchases: $54 M in Q3; $100 M additional repurchased post-quarter.
Dividend: $256 M in dividends paid in Q3; Q3 interim dividend of $1.014 per share approved.
About NXP Semiconductors N.V.
NXP Semiconductors N.V. (NASDAQ: NXPI) is a global provider of innovative solutions in the automotive, industrial & IoT, mobile, and communications infrastructure markets. The company, headquartered in Eindhoven, The Netherlands, posted revenue of $12.61 billion in 2024.
Key Takeaways
Cyclical Recovery: Strong sequential growth (QoQ) across all segments and regions suggests “signs of a cyclical recovery,” despite a minor YoY revenue decline.
Strategic Focus: Continued portfolio management through the sale of the MEMS sensors business and the acquisition of automotive connectivity expert Aviva Links.
Segment Performance: Mobile was the standout with 30% sequential growth, while Automotive remains NXP’s largest and most stable segment.
Robust Cash Flow & Capital Return: NXP generated $509 million in free cash flow and maintained its commitment to shareholders by returning over 60% of that FCF in the quarter.
Q4 Outlook: Guidance for Q4 projects revenue growth of up to 7% QoQ and Non-GAAP EPS of up to $3.49, indicating management confidence in continued sequential acceleration.