NXPI earnings analysis
What we found in NXPI's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
NXP delivered a strong Q2 recovery, with revenue of $3.496 billion up 19.5% year over year and 9.9% sequentially, while GAAP gross margin expanded to 57.3% and operating margin improved to 30.6% from 23.5% a year earlier. Growth was broad based across all four end markets, led by Communication Infrastructure & Other and Industrial & IoT, and Q2 free cash flow was $791 million. Sequential GAAP earnings comparisons are less favorable because Q1 included a $627 million MEMS divestiture gain, but underlying non-GAAP operating margin increased to 35.1% from 33.1% in Q1, alongside meaningful net-debt reduction.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue accelerated sequentially and year over year
- Q2 revenue rose $570 million, or 19.5% year over year, to $3.496 billion and increased $315 million, or 9.9%, from $3.181 billion in Q1 2026.
- Gross margin expanded 3.9 points year over year
- GAAP gross margin expanded to 57.3% from 53.4% a year ago and 56.2% sequentially, driven by higher volume, improved factory utilization and manufacturing-cost efficiency initiatives.
- Year-over-year profitability improved sharply
- GAAP operating margin reached 30.6%, up from 23.5% in Q2 2025. GAAP diluted EPS was $3.02, up from $1.75 a year ago.
- Broad-based end-market growth
- All end markets grew year over year: Communication Infrastructure & Other rose 41.3% to $452 million, Industrial & IoT rose 38.3% to $755 million, Automotive rose 12.1% to $1.938 billion, and Mobile rose 6.0% to $351 million.
- Strong cash conversion with low capex intensity
- Q2 operating cash flow was $860 million and net capex was $69 million, producing $791 million of free cash flow; capex represented 2.0% of quarterly revenue.
- Balance sheet deleveraging continued
- Total debt declined $1.246 billion from December 31, 2025 to $10.976 billion, while net debt decreased $1.201 billion to $7.754 billion after repayment of $750 million of senior notes.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Sequential GAAP earnings fell after divestiture gain
- GAAP operating income fell $434 million, or 28.8% sequentially, to $1.071 billion and GAAP diluted EPS declined from $4.43 in Q1 2026 to $3.02, principally because Q1 included a $627 million gain on the MEMS Sensors divestiture.
- Cash declined while near-term maturities remain
- Cash and equivalents declined $486 million sequentially to $3.222 billion at June 28, 2026, while total debt remained substantial at $10.976 billion; $999 million of notes principal is payable within 12 months.
- Receivables and capacity commitments used cash
- Working-capital and supply-support uses pressured operating cash flow in the first half: receivables and other current assets increased $101 million and payments securing production supply increased other non-current assets by $230 million, including $243 million for VSMC capacity infrastructure.
- Mobile demand declined sequentially
- Mobile revenue was the only end market to decline sequentially, falling $40 million, or 10.2%, to $351 million in Q2 2026.
- No risk-factor updates; interest burden persists
- Item 1A states there were no material changes to risk factors from the 2025 Form 10-K; nevertheless, the company has $2.655 billion of future interest payments associated with its fixed-rate notes, including $381 million within 12 months.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $3.02
- Gross margin
- 57.3%
- Operating margin
- 30.6%
- Segment
- Automotive: $1.938 billion, +12.1% year over year; +8.8% sequentially
- Segment
- Industrial & IoT: $755 million, +38.3% year over year; +20.2% sequentially
- Segment
- Mobile: $351 million, +6.0% year over year; -10.2% sequentially
- Segment
- Communication Infrastructure & Other: $452 million, +41.3% year over year; +18.9% sequentially
What they said about what is next.
The 10-Q MD&A does not provide quantitative forward revenue or EPS guidance; outlook is deferred to the earnings release/call.
The filing reads better than the one before it.
What came before.
- 10-Q · April 28, 2026
- NXP reported Q1 2026 revenue of $3,181 million, up 12.2% year‑over‑year, with GAAP diluted EPS of $4.43. Gross margin improved to 56.2% and operating margin expanded to 47.3%, driven largely by a $627 million gain on…
- 10-K · February 19, 2026
- NXP reported full-year 2025 revenue of $12,269 million, down from $12,614 million in 2024, while continuing to execute M&A to bolster automotive, AI-edge and in-vehicle networking capabilities. The company presents a…
- 10-Q · April 29, 2025
- NXP Semiconductors reported revenue of $2.84 billion for Q1 2025, a decrease from $3.13 billion in Q1 2024. Although there was an EPS beat at $1.92 against estimates of $2.58, the overall financial performance showed…
- 10-Q · November 5, 2024
- NXP reported Q3 revenue of $3,250,000,000 (down $184,000,000 YoY) with gross profit of $1,866,000,000 and operating income of $990,000,000. Gross margin was steady at ~57.4% while operating margin expanded to ~30.5%;…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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