Dutch chipmaker NXP Semiconductors N.V. reported fourth-quarter revenue that beat expectations today, but its profit came in lower than expected, sending its stock down less than a percentage point in extended trading.

The company reported net income of $1.06 billion for the quarter, or $2.24 per share. Revenue for the period rose 21%, to $3.04 billion. Wall Street had been looking for a profit of $2.99 per share on revenue of $3 billion.

NXP Chief Executive Kurt Sievers (pictured) said in a statement the chipmaker had enjoyed an “excellent year” overall in its fiscal 2021.

“We experienced significant design win traction across the entire portfolio and especially within the areas of our strategic growth drivers,” he said. “We continue to see growing customer demand, outstripping supply, as inventory across all end markets remains very lean. Taken together, this underpins our continued confidence of robust growth throughout 2022.”

Sievers’ comments are justified, as NXP also reported full fiscal 2021 revenue of $11.06 billion, up 28% from a year ago.

NXP manufactures a broad portfolio of silicon but it’s best known for its automotive chips, which are used in everything from car infotainment systems to tire pressure monitoring systems and vehicle-to-vehicle communications. Notably, its chips are built with gateways that prevent communication with every network within a car independently, in order to protect vehicles from being hacked.

The company also manufactures chips used in identification, wired and wireless infrastructure, lighting, industrial, consumer, mobile and computing applications.

NXP said its automotive business unit pulled in $1.547 billion in revenue, up 30% from a year ago and up 6% sequentially from the previous quarter. Industrial & IoT sales added $661 million, up 29% year-over-year and 9% sequentially. Mobile revenue fell 9%, to $374 million, though that was up 8% sequentially.

Lastly, the communications infrastructure and other business sales rose 16% from last year and 1% sequentially, to $457 million.

Constellation Research Inc. analyst Holger Mueller told SiliconANGLE he believes NXP is operating at a strong level thanks to business growth that’s fueled by high global demand for the chips it makes. “NXP’s year-over-year growth is impressive, but on a quarterly basis there has been a slowdown so it will be key for the company to try and maintain growth at the 10% level at least, or better yet at the 20% mark,” he said.

However, the analyst warned that investors may not appreciate NXP’s reliance on the automotive industry.

“Across the various use cases it covers, automotive accounts for 50% of the company’s revenue,” Mueller said. “In the next quarters investors will be looking to see if NXP moves deeper into automotive or tries to balance out its customer portfolio again.”

Looking to the first quarter of 2022, NXP said it’s forecasting revenue in a range of $3.025 billion to $3.175 billion, which is well ahead of Wall Street’s forecast of $2.96 billion in sales.

Photo: NXP