NXP Semiconductors experienced a 7% drop in its stock price following the announcement that CEO Kurt Sievers will retire at the end of the year. Rafael Sotomayor, who will take over as president, is set to assume the role on April 28, 2025. Despite the leadership change, NXP reported first-quarter results for fiscal 2025 that slightly surpassed analysts’ expectations.
The company posted adjusted earnings per share (EPS) of $2.64, which beat the forecast of $2.58. Revenues for the quarter were $2.84 billion, exceeding the anticipated $2.83 billion. However, the company faced challenges moving forward, as Sievers pointed to a “challenging set of market conditions,” particularly due to tariffs and their unpredictable impacts.
In terms of sales, NXP saw a 9% decline in revenue compared to the previous year. Auto sales, a key segment for the company, amounted to $1.67 billion, which was slightly below the expected $1.69 billion. The first-quarter net income for the company dropped by 23%, coming in at $490 million, compared to $639 million in the same period last year. Additionally, net income per share for the quarter fell 22%, from $2.47 to $1.92.
Looking ahead, NXP forecasted second-quarter sales to reach a midpoint of $2.9 billion, surpassing analysts’ expectations of $2.87 billion. Adjusted EPS for the second quarter is expected to be $2.66, which aligns with forecasts. While the company’s outlook remains somewhat optimistic, Sievers acknowledged the ongoing uncertainties in the market, particularly related to global trade tariffs.
NXP emphasized that Sievers’ decision to retire was personal and unrelated to any board issues or company performance. The announcement marks the end of an era for the semiconductor company, which has seen significant growth under his leadership. As the company transitions to new leadership, investors and analysts will be closely watching how NXP navigates the challenges ahead.
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