NXP Semiconductors (NXPI, Financial) reported a challenging quarter with a 9% decline in revenue to $2.84 billion, slightly surpassing analyst expectations of $2.83 billion. Adjusted earnings per share were $2.64, beating the anticipated $2.60. The company announced that CEO Kurt Sievers will retire later this year, with Rafael Sotomayor taking over as President immediately and as CEO by October 28. NXP cited Sievers' departure as a personal decision, unrelated to any board disagreements.
The company forecasts second-quarter revenue between $2.8 billion and $3 billion, slightly above analyst expectations. However, shares dropped over 8% in late trading as the company expressed concerns over a "very uncertain environment" due to tariffs. This uncertainty is compounded by weak demand for chips used in electric vehicles and smartphones, as customers work through pandemic-era inventories.
Despite signs of industry recovery, tariffs announced by former President Trump could disrupt the sector further. NXP remains cautiously optimistic about navigating these challenges. The company continues to invest in strategic acquisitions, including the purchase of TTTech Auto for $625 million and Kinara for $307 million, to enhance its software-defined automotive solutions.
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