NXP Beats Third-Quarter Estimates, but a Soft Fourth-Quarter Guide Sends Shares Down

NXP Semiconductors beat third-quarter estimates on Oct. 27, but a fourth-quarter revenue guide below analyst tallies sent its shares down after hours.

NXP Semiconductors reported third-quarter 2026 results on Oct. 27, 2026, after the market close. The quarter ended Sept. 27, 2026.

Revenue was $3.786 billion, up 19.3% from $3.173 billion a year earlier. It rose 8% from the second quarter's $3.496 billion.

That revenue cleared the $3.77 billion consensus in StockStory's tally by a narrow margin. StockStory is the one consensus tally named in this article.

Profit rose on reported and adjusted measures

Reported net income attributable to stockholders was $884 million, or $3.48 a share. A year earlier it was $631 million, or $2.48 a share.

Adjusted earnings, which strip out items management does not treat as core, were $4.20 a share. StockStory's tally put the consensus at $4.12 a share.

Adjusted net income attributable to stockholders was $1.065 billion. Reported gross margin was 57.8%, and adjusted gross margin was 58.6%.

Reported operating income was $1.228 billion, on operating expenses of $958 million. Adjusted operating margin was 37.1%, against a reported 32.4%.

Adjusted EBITDA was $1.547 billion in the quarter. Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization, with adjustments.

"NXP delivered third-quarter revenue of $3.8 billion, up 19 percent year-on-year and 8 percent sequentially," President and Chief Executive Rafael Sotomayor said.

He credited company-specific growth drivers in automotive and industrial. He also cited continued momentum in data center infrastructure.

Automotive crossed two billion dollars

Automotive revenue was $2.07 billion, up 13% from a year earlier. It remains NXP's largest end market by a wide margin.

Industrial and IoT revenue was $802 million, up 39%. Communication Infrastructure and Other revenue was $503 million, up 54%.

Mobile revenue was $411 million, down 4%. It was the only end market that shrank in the quarter.

Software-defined vehicles shift more computing into each car, raising chip content per vehicle. Sotomayor pointed to that shift as a long-term demand driver.

Channel inventory sat at 11 weeks, unchanged from the second quarter. A year earlier it was nine weeks, the company said.

The fourth-quarter guide landed light

NXP guided fourth-quarter revenue to a range of $3.75 billion to $3.95 billion. The midpoint is $3.85 billion, a TickerGrove calculation from the range.

StockStory's tally put the fourth-quarter consensus at $3.87 billion, above that midpoint. The midpoint still implies growth of about 15% from a year earlier.

Adjusted earnings guidance is $4.14 to $4.58 a share. The midpoint of that range is $4.36 a share, a TickerGrove calculation.

That adjusted midpoint sits roughly in line with analyst expectations, StockStory said. Reported earnings guidance is $3.36 to $3.79 a share.

Adjusted gross margin guidance is 58.5% to 59.5% for the quarter. The guide, not the beat, set the after-hours tone.

Investors focused on the guide, not the beat. StockStory reported shares tumbled 9% to $232.08 in after-hours trading immediately after the report.

Cash flow funded a larger buyback

Cash flow from operations was $1.256 billion in the quarter. After $50 million of net capital spending, adjusted free cash flow was $1.206 billion.

Free cash flow here is operating cash flow minus capital spending, on the company's adjusted basis. It equaled 31.9% of the quarter's revenue.

Trailing twelve-month adjusted free cash flow was $3.504 billion. That cash generation is what funds both investment and capital returns.

NXP returned $359 million to shareholders in the quarter. That was $256 million of dividends and $103 million of share repurchases.

In October, after the quarter ended, the board authorized a new $5 billion repurchase program. It sits on top of $1.3 billion remaining under the prior authorization.

Cash and equivalents were $3.943 billion at quarter-end. Long-term debt was $9.979 billion, with $999 million of short-term debt.

What remains unknown

What remains unknown is whether the light guide reflects softer demand or a cautious starting point. The release gives no segment-level outlook for the fourth quarter.

Also unknown is when Mobile returns to growth, after its 4% decline. Management discussed the results on its Oct. 27 conference call, held after this release.

What to watch is fourth-quarter delivery against the guide, automotive content demand, and channel inventory. The verified record is clear: the quarter beat tallies, and the guide reset expectations lower.