01—Abstract
Summary
Summary of the 10-K filed February 24, 2022. Cited figures are marked; the original filing is the authoritative source.
NXP Semiconductors N.V.
(NXPI) reported strong revenue growth of 28.5% to $11,063 milliona for the fiscal year ended December 31, 2021, driven by robust demand across its key automotive and industrial & IoT segments. This performance reflects a significant rebound from the COVID-19 impacts in 2020 and the successful adoption of the company's innovative product portfolio. Gross profit increased substantially, with margins improving to 54.8% from 49.2% in the prior year, benefiting from higher volumes and improved pricing.
The company also generated strong operating cash flows of $3,077 millionb and returned $4,577 million to shareholders through dividends and share repurchases. Despite the positive financial results, investors should note the identification of a material weakness in internal controls related to information technology general controls (ITGCs).
While remediation plans are in place and expected to be completed in fiscal year 2022, this remains a point of vigilance. The company's outlook for 2022 remains positive, anticipating continued demand to outpace supply, although managing supply chain constraints remains a key operational focus.
02—Key points
Key Highlights
- Revenue surged by 28.5% to $11,063 million in 2021, driven by strong performance in Automotive and Industrial & IoT segments.
- Gross profit margin improved significantly to 54.8% from 49.2% in 2020, reflecting higher volumes and improved pricing.
- Operating income saw a substantial increase, reaching $2,583 million in 2021 compared to $418 million in 2020.
- The company generated strong operating cash flow of $3,077 million in 2021.
- NXP returned $4,577 million to shareholders through dividends and share repurchases in 2021.
- A material weakness in internal IT general controls was identified, impacting financial reporting; remediation is underway.
- Total debt increased to $10,572 million by year-end 2021, primarily due to new senior unsecured note issuances.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, NXP Semiconductors N.V. kept $0.17.
- Revenue$11.06B100.0%
- Cost of revenue−$5.00B45.2%
- Gross profit$6.07B54.8%
- Operating costs−$3.48B31.5%
- Operating income$2.58B23.3%
- Interest, other & tax−$712.0M6.4%
- Net income$1.87B16.9%
Where FY2021 revenue went
$11.06B- Cost of revenue: $5.00B, 45% of revenue
- R&D: $1.94B, 17% of revenue
- Net income: $1.87B, 17% of revenue
- SG&A: $956.0M, 8.6% of revenue
- Other operating costs: $592.0M, 5.4% of revenue
- Interest, other & tax: $712.0M, 6.4% of revenue
Kept 17% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 24, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $11.06B$8.61B | +28.5% |
| Cost of Revenue | $5.00B$4.38B | +14.1% |
| Gross Profit | $6.07B$4.24B | +43.3% |
| R&D Expenses | $1.94B$1.73B | +12.2% |
| SG&A Expenses | $956.00M$879.00M | +8.8% |
| Operating Expenses | $3.48B$3.93B | −11.4% |
| Operating Income | $2.58B$418.00M | +517.9% |
| Interest Expense | $369.00M$362.00M | +1.9% |
| Net Income | $1.87B$52.00M | +3498.1% |
| EPS (Basic) | $6.91$0.19 | +3536.8% |
| EPS (Diluted) | $6.79$0.18 | +3672.2% |
| Shares Outstanding (Basic) | 270.69M279.76M | −3.2% |
| Shares Outstanding (Diluted) | 275.65M283.81M | −2.9% |
05—Questions
Frequently Asked Questions
What was NXP's revenue performance in 2021?
NXP Semiconductors N.V. reported a significant increase in revenue, reaching $11,063 million for the year ended December 31, 2021, a 28.5% increase compared to $8,612 million in 2020. This growth was attributed to strong demand across its automotive, industrial & IoT, mobile, and communication infrastructure end markets, with particular strength in Automotive and Industrial & IoT.
What is the company's financial health regarding debt and cash flow?
NXP generated robust operating cash flow of $3,077 million in 2021. However, total debt increased to $10,572 million as of December 31, 2021, mainly due to the issuance of new senior unsecured notes. The company's cash position increased to $2,830 million, providing substantial liquidity.
What are the key concerns or risks highlighted in the filing for investors?
A primary concern highlighted is the material weakness identified in the company's internal control over financial reporting, specifically related to information technology general controls (ITGCs). While NXP is implementing remediation plans, this indicates a potential risk to the accuracy and reliability of financial reporting. The company also faces risks inherent to the semiconductor industry, such as cyclicality, intense competition, and supply chain disruptions.
How is NXP returning value to shareholders?
In 2021, NXP returned approximately $4,577 million to shareholders through a combination of dividends ($606 million) and share repurchases ($4,015 million). The company also increased its quarterly cash dividend by 50% in January 2022.
06—Continue