NXP (NXPI) Q3 2026 Earnings Call: Record Revenue, SDV Growth and $5 Billion Buyback
Source Tradingkey
Key Takeaways
- NXP reported record Q3 2026 revenue of $3.79 billion, up 19% year over year and 8% sequentially. Excluding the MEMS Sensor business, revenue increased 22% year over year.
- Non-GAAP operating margin reached 37.1%, up 330 basis points year over year, while non-GAAP EPS rose 35% to $4.20.
- Automotive revenue exceeded $2 billion for the first time and increased 17% year over year excluding sensors. Management said software-defined vehicle, or SDV, revenue was running above a $1.5 billion annualized rate.
- Industrial and IoT revenue increased 39% to $802 million, led by data centers, factory automation and healthcare. Communication Infrastructure and Other revenue rose 54% to $503 million.
- NXP guided Q4 revenue to $3.85 billion at the midpoint and non-GAAP EPS to $4.36. Management also expects double-digit revenue growth and gross margin expansion to 60% during 2027.
- The board authorized an additional $5 billion for share repurchases, lifting total authorization to approximately $6.3 billion. NXP plans to accelerate buybacks beginning in Q4 and through 2027.
Core Financial Data
| Metric | Q3 2026 | Change / Commentary |
|---|---|---|
| Revenue | $3.79 billion | Up 19% YoY and 8% QoQ; up 22% YoY excluding MEMS sensors |
| Non-GAAP gross margin | 58.6% | Up 160 basis points YoY |
| Non-GAAP operating expenses | $810 million | 21.4% of revenue |
| Non-GAAP operating margin | 37.1% | Up 330 basis points YoY |
| Non-GAAP EPS | $4.20 | Up 35% YoY |
| Operating cash flow | $1.26 billion | Stronger cash generation supported investment and capital returns |
| Free cash flow | $1.21 billion | Approximately 32% of revenue |
| Cash | $3.94 billion | Quarter-end balance |
| Debt | $10.98 billion | Net leverage ratio of 1.3x |
| Inventory days | 148 days | Down from 156 days in Q2; includes about 13 days of prebuilt inventory |
Business and Operating Performance
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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