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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One) 
  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 2, 2022
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             .
Commission File Number: 001-34841
NXP Semiconductors N.V.
(Exact name of registrant as specified in its charter)
 
Netherlands
98-1144352
(State or other jurisdiction
of incorporation or organization)
(I.R.S. employer identification number)
60 High Tech Campus
5656 AG
Eindhoven
Netherlands
(Address of principal executive offices)
(Zip code)
+31
40
2729999
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common shares, EUR 0.20 par value
NXPI
The Nasdaq Global Select Market
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes      No  
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).
Yes      No  
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company




If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes      No  

As of October 28, 2022, there were 259,134,862 shares of our common stock, €0.20 par value per share, issued and outstanding.



NXP Semiconductors N.V.
Form 10-Q
For the Fiscal Quarter Ended October 2, 2022
TABLE OF CONTENTS





PART I — FINANCIAL INFORMATION
Item 1.    Financial Statements

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
($ in millions, unless otherwise stated)
For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Revenue3,445 2,861 9,893 8,024 
Cost of revenue(1,478)(1,278)(4,267)(3,664)
Gross profit1,967 1,583 5,626 4,360 
Research and development(548)(492)(1,608)(1,429)
Selling, general and administrative(289)(243)(805)(699)
Amortization of acquisition-related intangible assets(131)(137)(400)(456)
Total operating expenses(968)(872)(2,813)(2,584)
Other income (expense)2  4  
Operating income (loss)1,001 711 2,817 1,776 
Financial income (expense):
Extinguishment of debt  (18) 
Other financial income (expense)(98)(93)(313)(280)
Income (loss) before income taxes903 618 2,486 1,496 
Benefit (provision) for income taxes(149)(95)(392)(200)
Results relating to equity-accounted investees(4)3 5  
Net income (loss)750 526 2,099 1,296 
Less: Net income (loss) attributable to non-controlling interests12 7 34 27 
Net income (loss) attributable to stockholders738 519 2,065 1,269 
Earnings per share data:
Net income (loss) per common share attributable to stockholders in $
Basic2.81 1.95 7.86 4.66 
Diluted2.79 1.91 7.80 4.57 
Weighted average number of shares of common stock outstanding during the period (in thousands):
Basic262,180 266,557 262,620 272,314 
Diluted264,705 271,359 264,838 277,886 

See accompanying notes to the Condensed Consolidated Financial Statements
1

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
($ in millions, unless otherwise stated)
For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Net income (loss)750 526 2,099 1,296 
Other comprehensive income (loss), net of tax:
Change in fair value cash flow hedges(13)(2)(25)(16)
Change in foreign currency translation adjustment(78)(23)(165)(56)
Change in net actuarial gain (loss)1    
Total other comprehensive income (loss)(90)(25)(190)(72)
Total comprehensive income (loss)660 501 1,909 1,224 
Less: Comprehensive income (loss) attributable to non-controlling interests12 7 34 27 
Total comprehensive income (loss) attributable to stockholders648 494 1,875 1,197 

See accompanying notes to the Condensed Consolidated Financial Statements
2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

($ in millions, unless otherwise stated)
October 2, 2022December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents3,759 2,830 
Accounts receivable, net1,012 923 
Inventories, net1,581 1,189 
Other current assets351 286 
Total current assets6,703 5,228 
Non-current assets:
Other non-current assets1,940 1,346 
Property, plant and equipment, net of accumulated depreciation of $5,055 and $4,676
2,971 2,635 
Identified intangible assets, net of accumulated amortization of $2,729 and $3,021
1,417 1,694 
Goodwill9,909 9,961 
Total non-current assets16,237 15,636 
Total assets22,940 20,864 
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable1,534 1,252 
Restructuring liabilities-current8 25 
Other current liabilities1,677 1,175 
Total current liabilities3,219 2,452 
Non-current liabilities:
Long-term debt11,162 10,572 
Restructuring liabilities12 12 
Deferred tax liabilities39 57 
Other non-current liabilities1,123 1,001 
Total non-current liabilities12,336 11,642 
Total liabilities15,555 14,094 
Equity:
Non-controlling interests279 242 
Stockholders’ equity:
Common stock, par value €0.20 per share:
56 56 
Capital in excess of par value13,996 13,727 
Treasury shares, at cost:
 14,130,857 shares (2021: 9,569,359 shares)
(2,765)(1,932)
Accumulated other comprehensive income (loss)(142)48 
Accumulated deficit(4,039)(5,371)
Total stockholders’ equity7,106 6,528 
Total equity7,385 6,770 
Total liabilities and equity22,940 20,864 

See accompanying notes to the Condensed Consolidated Financial Statements
3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

($ in millions, unless otherwise stated)

For the nine months ended
October 2, 2022October 3, 2021
Cash flows from operating activities:
Net income (loss)2,099 1,296 
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
Depreciation and amortization948 952 
Share-based compensation267 265 
Amortization of discount (premium) on debt, net2 1 
Amortization of debt issuance costs5 5 
Net (gain) loss on sale of assets(2) 
(Gain) loss on equity security, net6 (2)
(Gain) loss on extinguishment of debt18  
Results relating to equity-accounted investees(5) 
Deferred tax expense (benefit)(196)6 
Changes in operating assets and liabilities:
(Increase) decrease in receivables and other current assets(165)(214)
(Increase) decrease in inventories(392)(143)
Increase (decrease) in accounts payable and other liabilities545 242 
Decrease (increase) in other non-current assets(325)(106)
Exchange differences(2)(3)
Other items16 (7)
Net cash provided by (used for) operating activities2,819 2,292 
Cash flows from investing activities:
Purchase of identified intangible assets(122)(99)
Capital expenditures on property, plant and equipment(830)(501)
Purchase of equipment leased to others(5)(14)
Insurance recoveries received for equipment damage 7 
Proceeds from disposals of property, plant and equipment2 1 
Purchase of interests in businesses, net of cash acquired(27)(17)
Purchase of investments(9)(6)
Proceeds from sale of investments12 8 
Proceeds from return of equity investment2 3 
Net cash provided by (used for) investing activities(977)(618)
Cash flows from financing activities:
Repurchase of long-term debt(917) 
Proceeds from the issuance of long-term debt 1,496 2,000 
Cash paid for debt issuance costs(13)(22)
Dividends paid to common stockholders(594)(412)
Proceeds from issuance of common stock through stock plans58 60 
Purchase of treasury shares and restricted stock unit withholdings(920)(3,265)
Other, net(1)(1)
Net cash provided by (used for) financing activities(891)(1,640)
Effect of changes in exchange rates on cash positions(22)(6)
Increase (decrease) in cash and cash equivalents929 28 
Cash and cash equivalents at beginning of period2,830 2,275 
Cash and cash equivalents at end of period3,759 2,303 
Supplemental disclosures to the condensed consolidated cash flows
Net cash paid during the period for:
Interest217 216 
Income taxes, net of refunds432 250 
Net gain (loss) on sale of assets:
Cash proceeds from the sale of assets2  
Book value of these assets  
Non-cash investing activities:
Non-cash capital expenditures176 224 

See accompanying notes to the Condensed Consolidated Financial Statements
4

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited)

($ in millions, unless otherwise stated)

Outstanding
number of
shares (in
thousands)
Common
stock
Capital in
excess of
par value
Treasury
shares at
cost
Accumulated
other
comprehensive
income (loss)
Accumulated
deficit
Total
stock-
holders’
equity
Non-
controlling
interests
Total
equity
Balance as of December 31, 2021264,950 56 13,727 (1,932)48 (5,371)6,528 242 6,770 
Net income (loss)657 657 9 666 
Other comprehensive income(22)(22)(22)
Share-based compensation plans92 92 92 
Shares issued pursuant to stock awards256 51 (23)28 28 
Treasury shares repurchased and retired(2,653)(552)(552)(552)
Dividends common stock ($0.845 per share)
(222)(222)(222)
Balance as of April 3, 2022262,553 56 13,819 (2,433)26 (4,959)6,509 251 6,760 
Net income (loss)670 670 13 683 
Other comprehensive income(78)(78)(78)
Share-based compensation plans85 85 85 
Shares issued pursuant to stock awards57 11 (11)  
Treasury shares repurchased and retired(15)(2)(2)(2)
Dividends common stock ($0.845 per share)
(222)(222)(222)
Balance as of July 3, 2022262,595 56 13,904 (2,424)(52)(4,522)6,962 264 7,226 
Net income (loss)738 738 12 750 
Other comprehensive income(90)(90)(90)
Share-based compensation plans92 92 92 
Shares issued pursuant to stock awards295 60 (30)30 30 
Treasury shares and restricted stock unit withholdings(2,501)(401)(401)(401)
Change in participation(3)(3)3  
Dividends common stock ($0.845 per share)
(222)(222)(222)
Balance as of October 2, 2022260,389 56 13,996 (2,765)(142)(4,039)7,106 279 7,385 



5

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited)

($ in millions, unless otherwise stated)

Outstanding
number of
shares (in
thousands)
Common
stock
Capital in
excess of
par value
Treasury
shares at
cost
Accumulated
other
comprehensive
income (loss)
Accumulated
deficit
Total
stock-
holders’
equity
Non-
controlling
interests
Total
equity
Balance as of December 31, 2020280,475 59 14,133 (1,037)117 (4,328)8,944 207 9,151 
Net income (loss)353 353 11 364 
Other comprehensive income(56)(56)(56)
Share-based compensation plans91 91 91 
Shares issued pursuant to stock awards361 37 (6)31 31 
Treasury shares repurchased and retired
(5,087)(905)(905)(905)
Dividends common stock ($0.5625 per share)
(155)(155)(155)
Balance as of April 4, 2021275,749 59 14,224 (1,905)61 (4,136)8,303 218 8,521 
Net income (loss)397 397 9 406 
Other comprehensive income9 9 9 
Share-based compensation plans88 88 88 
Shares issued pursuant to stock awards64 6 (6)  
Treasury shares repurchased and retired(6,103)(1,203)(1,203)(1,203)
Dividends common stock ($0.5625 per share)
(152)(152)(152)
Balance as of July 4, 2021269,710 59 14,312 (3,102)70 (3,897)7,442 227 7,669 
Net income (loss)519 519 7 526 
Other comprehensive income(25)(25)(25)
Share-based compensation plans80 80 80 
Shares issued pursuant to stock awards2,430 231 (202)29 29 
Treasury shares and restricted stock unit withholdings
(5,800)(1,157)(1,157)(1,157)
Dividends common stock ($0.5625 per share)
(150)(150)(150)
Balance as of October 3, 2021266,340 59 14,392 (4,028)45 (3,730)6,738 234 6,972 

See accompanying notes to the Condensed Consolidated Financial Statements

6


NXP SEMICONDUCTORS N.V.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
All amounts in millions of $ unless otherwise stated

1 Basis of Presentation and Overview

We prepared our interim condensed consolidated financial statements that accompany these notes in conformity with U.S. generally accepted accounting principles, consistent in all material respects with those applied in our Annual Report on Form 10-K for the year ended December 31, 2021.

We have made estimates and judgments affecting the amounts reported in our condensed consolidated financial statements and the accompanying notes. The actual results that we experience may differ materially from our estimates. The interim financial information is unaudited, but reflects all normal adjustments that are, in our opinion, necessary to provide a fair statement of results for the interim periods presented. This interim information should be read in conjunction with the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2021.

2 Significant Accounting Policies and Recent Accounting Pronouncements

Significant Accounting Policies
For a discussion of our significant accounting policies see, “Part II – Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – “Significant Accounting Policies” of our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no changes to our significant accounting policies since our Annual Report on Form 10-K for the year ended December 31, 2021.

New accounting standards not yet adopted
In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations. ASU 2022-04, which require that a buyer in a supplier finance program to disclose sufficient information about the program, is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the implications of adoption on our Consolidated Financial Statements.

Accounting standards recently adopted
No new accounting pronouncements were issued or became effective in the period that had, or are expected to have, a material impact on our Consolidated Financial Statements.

3 Acquisitions and Divestments

2022
On July 19, 2022, we acquired PL Sense for a total consideration of $22.1 million, net of closing adjustments. There were no material divestments during the first nine months of 2022.

2021
On July 6, 2021, we acquired Retune DSP for a total consideration of $15.7 million, net of closing adjustments.


4 Supplemental Financial Information

Statement of Operations Information:

Disaggregation of revenue

The following table presents revenue disaggregated by sales channel:
For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Distributors1,876 1,631 5,385 4,617 
Original Equipment Manufacturers and Electronic Manufacturing Services1,525 1,191 4,378 3,295 
Other
44 39 130 112 
Total3,445 2,861 9,893 8,024 
7



Depreciation, amortization and impairment

For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Depreciation of property, plant and equipment156 139 447 406 
Amortization of internal use software3 1 9 5 
Amortization of other identified intangible assets 1)
162 166 492 541 
Total - Depreciation, amortization and impairment321 306 948 952 
1) For the nine month period ending October 3, 2021, the amount includes an impairment charge as a result of the discontinuation of an IPR&D project for an amount of $36 million.


Financial income and expense

For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Interest income21 1 29 3 
Interest expense(109)(96)(319)(273)
Total interest expense, net(88)(95)(290)(270)
Extinguishment of debt  (18) 
Foreign exchange rate results(1)3 2 3 
Miscellaneous financing costs/income and other, net(9)(1)(25)(13)
Total other financial income/ (expense)(10)2 (41)(10)
Total - Financial income and expenses(98)(93)(331)(280)

Earnings per share

The computation of earnings per share (EPS) is presented in the following table:
For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Net income (loss)750 526 2,099 1,296 
Less: net income (loss) attributable to non-controlling interests12 7 34 27 
Net income (loss) attributable to stockholders738 519 2,065 1,269 
Weighted average number of shares outstanding (after deduction of treasury shares) during the year (in thousands)262,180 266,557 262,620 272,314 
Plus incremental shares from assumed conversion of:
Options 1)
275 378 297 397 
Restricted Share Units, Performance Share Units and Equity Rights 2)
2,250 4,424 1,921 5,175 
Dilutive potential common shares2,525 4,802 2,218 5,572 
Adjusted weighted average number of shares outstanding (after deduction of treasury shares) during the year (in thousands)264,705 271,359 264,838 277,886 
EPS attributable to stockholders in $:
Basic net income (loss)2.81 1.95 7.86 4.66 
Diluted net income (loss)2.79 1.91 7.80 4.57 
1)    There were no stock options to purchase shares of NXP’s common stock that were outstanding in Q3 2022 and YTD 2022 (Q3 2021 and YTD 2021: no shares) that were anti-dilutive and were not included in the computation of diluted EPS because the exercise price was greater than the average fair market value of the common stock or the number of shares assumed to be repurchased using the proceeds of unrecognized compensation expense and exercise prices were greater than the weighted average number of shares underlying outstanding stock options.
8


2)    There were 0.3 million unvested RSUs, PSUs and equity rights that were outstanding in Q3 2022 and 0.3 million outstanding YTD 2022 (Q3 2021 and YTD 2021: no shares) that were anti-dilutive and were not included in the computation of diluted EPS because the number of shares assumed to be repurchased using the proceeds of unrecognized compensation expense were greater than the weighted average number of outstanding unvested RSUs, PSUs and equity rights or the performance goal has not been met yet.

Balance Sheet Information

Cash and cash equivalents

At October 2, 2022 and December 31, 2021, our cash balance was $3,759 million and $2,830 million, respectively, of which $215 million and $208 million was held by SSMC, our consolidated joint venture company with TSMC. Under the terms of our joint venture agreement with TSMC, a portion of this cash can be distributed by way of a dividend to us, but 38.8% of the dividend will be paid to our joint venture partner. During both first nine months of 2022 and 2021, no dividends were declared by SSMC.

Inventories

The portion of finished goods stored at customer locations under consignment amounted to $9 million as of October 2, 2022 (December 31, 2021: $12 million).

Inventories are summarized as follows:
October 2, 2022December 31, 2021
Raw materials140 107 
Work in process1,133 846 
Finished goods308 236 
1,581 1,189 
The amounts recorded above are net of allowance for obsolescence of $129 million as of October 2, 2022 (December 31, 2021: $120 million).

Equity Investments

At October 2, 2022 and December 31, 2021, the total carrying value of investments in equity securities is summarized as follows:
October 2, 2022December 31, 2021
Marketable equity securities7 18 
Non-marketable equity securities14 19 
Equity-accounted investments81 75 
102 112 

The total carrying value of investments in equity-accounted investees is summarized as follows:
October 2, 2022December 31, 2021
Shareholding %AmountShareholding %Amount
SMART Growth Fund, L.P.1)
8.41 %44 8.41 %31 
Others 37  44 
81 75 
1) Previously named “Wise Road Industry Investment Fund I, L.P.”

Results related to equity-accounted investees at the end of each period were as follows:
For the three months endedFor the nine months ended
October 2, 2022October 3, 2021October 2, 2022October 3, 2021
Company's share in income (loss)(5)4 3 1 
Other results1 (1)2 (1)
(4)3 5  



9


Other current liabilities

Other current liabilities at October 2, 2022 and December 31, 2021 consisted of the following:
October 2, 2022December 31, 2021
Accrued compensation and benefits508 476 
Income taxes payable232 82 
Dividend payable221 149 
Other716 468 
1,677 1,175 

Accumulated other comprehensive income (loss)

Total comprehensive income (loss) represents net income (loss) plus the results of certain equity changes not reflected in the condensed consolidated statements of operations. The after-tax components of accumulated other comprehensive income (loss) and their corresponding changes are shown below:
Currency 
translation
differences
Change in fair 
value
cash flow hedges
Net actuarial
gain/(losses)
Accumulated 
Other
Comprehensive
Income (loss)
As of December 31, 2021207  (159)48 
Other comprehensive income (loss) before
   reclassifications
(165)(53) (218)
Amounts reclassified out of accumulated other
   comprehensive income (loss)
 19  19 
Tax effects 9  9 
Other comprehensive income (loss)(165)(25) (190)
As of October 2, 202242 (25)(159)(142)

Cash dividends

The following dividends were declared during the first three quarters of 2022 and 2021 under NXP’s quarterly dividend program:

Fiscal year 2022Fiscal year 2021
Dividend per shareAmountDividend per share