NXP Sees Record Revenues in 2021; Automotive Segment Leads the Way

  • NXP’s automotive segment crossed $5.4 billion in revenues in 2021, surpassing the previous high of $4.5 billion in 2018. The segment will continue to gain traction as “chips per vehicle” increase along with electrification. NXP’s leadership in products related to sensing and processing applications will enable it to witness continuous momentum.
  • The semiconductor shortages are expected to ease from 2023 onwards, hence supply-demand mismatch will remain for the rest of this year. But NXP has taken steps to ensure additional capacity expansion is in place to future-proof its supply capabilities. Furthermore, the non-cancelable, non-returnable (NCNR) concept is proving to be helpful on this front. The capex will reach $1.03 billion to account for 8.3% of total revenues in 2022.
  • For 2022, the company is aiming for 12.7% YoY revenue growth to cross $12.4 billion. For the first quarter, the target is 21% YoY growth at $3.1 billion.

NXP, a leading player in secure connectivity solutions for embedded applications, had a stellar performance in 2021. The company’s revenues increased 28.5% YoY to reach a record $11.06 billion. This was possible due to strong customer demand and significant design wins across its end markets despite supply chain challenges. In particular, NXP’s automotive segment did well by catering to solutions revolving around in-vehicle networking, advanced driver assistance systems (ADAS), and battery management in EVs. Gross profit for 2021 stood at $6.06 billion, an increase of 37% YoY.

NPX division wise revenue (2017-2021)

Note: As of January 1, 2019, revenues and costs associated with Manufacturing Service Agreements were consolidated under “Other Income & Expense” and not reported as revenue.


NXP’s automotive segment revenue stood at $5.4 billion in 2021 with 43.6% YoY growth. It managed to capture 50% of the total revenue of the company, an increase of 5% share from the previous year. Products centered around the evolving needs of the automotive industry, such as domain and zonal processors, electrification, and radar systems are helping the company increase revenue and industry-wide collaborations. As the automotive segment is moving towards xEVs, electric and hybrid electric vehicles, the semiconductor content in cars is increasing. In addition to this, the Level 2 and Level 3 autonomy efforts are getting more traction. This will help NXP position itself in the radar and related networking processors space and drive long-term growth. For example, Ford will use NXP’s i.MX 8 series processors and S32G2 vehicle networking processors across its fleet globally to support new vehicle architecture and deliver upgraded services, experiences, and new data monetization avenues. Denso will use NXP’s 5th Generation Radar 1-Chip SoC which employs leading-edge technology nodes and state-of-the-art 77GHz RFCMOS performance.

Industrial & IoT 

The industrial and IoT segment is NXP’s second-largest revenue generator after automotive, accounting for 21.8% of the 2021 revenue. The segment grew 31.3% YoY to $2.4 billion in 2021. NXP is focused on solutions related to fast-growing segments such as smart homes and wearables within the IoT segment and factory automation, building and energy, and healthcare within the industrial segment.

Its leadership in longtail and large OEM partnerships along with a broad connectivity portfolio (MCU and application processors, BLE, Zigbee, Wi-Fi, etc.) for the intelligent edge is helping the company with client stickiness. Some customer examples include Schneider Electric in factory automation and ChargePoint in electric vehicle charging. Further, in Q4 2021, the company released its i.MX 93 applications processor and i.MX 8XLite SoC to cover a range of applications, including industrial and IoT.

Communication Infrastructure & Other 

The third highest revenue-generating segment accounted for a 15.8% share. It witnessed an increase of just 2.6% YoY to reach $1.7 billion. As the telecom industry embraces the 5G supercycle, NXP’s antenna-to-processor portfolio is in place to address its 5G configuration and infrastructure needs.

NXP’s infrastructure-focused portfolio includes the Layerscape Access family of software-defined baseband processors for applications operating in mmWave and sub-6GHz frequencies, AirFast family of RF power solutions/multi-chip modules for 5G cellular base stations, and the Layerscape scalable series of 64-bit ARM-based SoCs for FWA, small cells, premises, etc. These products, which are future-proof and scalable, help customers with fast time-to-market and optimized solutions.


NXP’s mobile segment, which holds the smallest revenue share at 12.8%, posted a YoY growth of 13.1% to cross $1.4 billion in revenues. The Q4 revenue, however, declined 8.6% YoY to reach $374 million. Specific areas where NXP has the expertise and industry-wide technical collaborations are mobile NFC Wallet, UWB technology, and ready-to-use systems solutions (i.e. end-to-end security and software).

UWB secure access solutions are gaining traction in smartphones, IoT devices, and automobiles. NXP is aiming to increase the UWB market share through its leadership in mobile wallet/car access and ecosystem knowledge.

CAPEX Overview and Expansion

The capex stood at 4.6% ($392 million) and 6.9% ($762 million) of 2020 and 2021 revenues respectively. Given the strong underlying demand, this share will increase in 2022. It is estimated to be at the higher end of NXP’s target of 6-8%, with the company planning to expand its internal back-end capacity and run its front-end fabs to the maximum to clear the order backlog and prepare for future orders. Furthermore, it is expanding its testing and packaging operations. It has also invested $4 billion in advance payments to ensure a steady production supply from foundries in the long term.

Future Guidance

Against the backdrop of strong customer demand, NXP, in 2022, aims to achieve a higher yearly revenue growth than its long-term target of 8-12%. It has also indicated strong guidance for the first quarter — 21% YoY growth at $3.1-billion revenue. However, the sequential growth will remain flat at around 2%. The automotive segment will lead with the highest growth in the mid-20s range YoY. This segment’s product demand is bolstered by the growing digitization and electrification of cars and is primarily driven by OEMs and Tier 1s that are focused on strengthening their supply chains and rebuilding inventory.

As the market reels under a supply-demand mismatch and inventory is lean across all end markets for NXP, the company is focused on minimizing the supply chain constraints by increasing capex and building more supply capabilities. Another concept that is proving helpful for the company by providing transparency and stability is the non-cancelable, non-returnable (NCNR) orders, especially relevant for the automotive segment. Having a direct and close relationship with OEMs provides a clear view of what products/equipment to focus on and prioritize in the short to medium term.

Future growth enablers which will lead to accelerated revenue growth for NXP include:

  • Proliferation of xEVs (BEVs/PHEVs) and higher-level autonomous cars (L2+)/radar systems, which require more semiconductor content per car.
  • UWB secure access solutions.
  • RF Power for 5G infrastructure.
  • Secure connected edge solutions.


Capitalizing on the aforementioned growth drivers will be the company’s focus in the near future. Specifically, the automotive segment will benefit the most as the industry moves towards software-oriented vehicles with OEMs adopting next-generation network architectures. This transformation within vehicles will help NXP with continuous orders for its flagship product, the S32G2 gateway chip, which the company is ramping up as well. Furthermore, continuous innovations in its portfolio, along with increased collaboration with auto players, will enable it to capture a larger share of the automotive semiconductor market. Another application that has the potential to see immense growth is Ultra-wideband technology. UWB is seeing increased use cases in mobiles, cars, IoT devices, and more, and the company is at the forefront to capitalize on that with its expertise in mobile NFC wallet and car access applications. NXP is bullish on revenues from the UWB segment, expecting ~80% CAGR during 2021-2024 and overall revenues of $15 billion, growing at a CAGR of 8-12% for the same period.

AMD in 2021: A Year of Great Profits, Market Gains

AMD, one of the world’s leading chip companies, has reported a 49% YoY growth in its Q4 2021 revenue to $4.8 billion while increasing its gross margin by 560 basis points from the same period in 2020. For 2021, its revenue grew 68% YoY to $16.4 billion and the gross margin increased by 370 basis points due to strong data center revenues and high-end processor sales. Data center business contributed to ~25% of AMD’s overall revenues for 2021.

Company Strategy for 2021
The revenues reflect the company’s strategy to focus on high-margin data center products and high-end Ryzen processors for 2021 as semiconductor shortages persisted throughout the year along with supply chain hiccups.

Counterpoint Research AMD Earnings
Source: Company Earnings, Counterpoint Estimates

Annual Segment Updates:

Computing and graphics

The segment’s revenues grew 45% YoY to $9.3 billion in 2021. A 57% increase in the average selling price (ASP) and a higher mix of the latest Ryzen processors along with high-end GPU cards drove the segment’s revenues and profitability to record levels since 2011.

Client launches in 2021

AMD launched the Ryzen 5000 series and Ryzen PRO 5000 series mobile processors powered by the Zen 3 core architecture for business laptops built on 7 nm.

AMD expanded its graphic cards portfolio by launching the Radeon RX 6700 XT built on 7 nm process technology and AMD RDNA 2 gaming architecture, as well as the Radeon RX 6600 XT graphics card that delivers a high frame rate, high fidelity and highly responsive 1080p gaming experience. In mobile graphics, Radeon RX 6000M series was launched for high-performance gaming laptops.

Enterprise, Embedded and Semi-Custom

The revenue grew 113% YoY to $7.1 billion due to EPYC processor and MI200 accelerator sales in HPC (high performance computing), and Cloud and Supercomputer wins. Besides, demand from gaming consoles, automotive and IoT contributed to the segment’s growth.

Data center launches in 2021

AMD launched the Instinct MI200 series accelerators based on the 2nd Gen AMD CDNA architecture, optimized for HPC and AI/ML (artificial intelligence/machine learning) workloads. Next-generation AMD EPYC processors – AMD EPYC 7003 series CPUs boasting 64 Zen 3 cores per processor for HPC, cloud and enterprise customers, were also launched.

Analyst takeaways and company outlook for 2022

  • AMD estimates a 31% YoY annual revenue growth for 2022 to ~$21.5 billion.
  • Data center revenues to be ~30% of overall revenues.
  • Xilinx acquisition creates synergies for its embedded portfolio for other industry segments including IoT, automotive and networking.

AMD will gain market share in the server segment due to the launch of Genoa, its next-generation EPYC processors that feature 96 Zen 4 cores and next-generation memory and I/O technologies. Besides, the ‘Infinity Fabric’, which provides greater efficiencies by connecting CPU and GPU, will play a pivotal role in AMD’s market share considering the accelerator portfolio has established itself as a catalyst in AMD’s data center segment.

The diversification through the successful acquisition of Xilinx has unlocked opportunities for AMD to capture the demand from the networking industry and create an end-to-end solution portfolio for specialized workloads.

For the client side, we see demand correction as the COVID-19 pandemic-led demand subsides in the PC market. However, the compute refresh cycles in enterprise and increased demand from premium ultrathin/thin laptops will offset some of the demand correction, as indicated by the launch of its processors and SKUs at CES 2022.

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