(Reuters) -NXP Semiconductors NV forecast fourth-quarter revenue above Wall Street estimates on Monday, as it recovers from sluggish demand and sees a rebound in the automotive segment.
Shares of the Eindhoven, Netherlands-based company rose 2% in U.S. extended trading, having gained 6.6% so far this year.
The chipmaker is benefiting from momentum across automotive end markets due to demand for its scalable processing solutions.
Analysts say that the auto end market is improving following tariff-related pull-ins, benefiting companies like NXP.
NXP provides manufacturers with chips and other technology essential for high-speed digital processing utilized in sectors like automotive, manufacturing, telecommunications and the Internet of Things (IoT).
The company has made a string of acquisitions recently, having closed a $243 million cash deal for Aviva Links, an automotive networking company, last week. It completed its TTTech Auto purchase in June, looking to strengthen the automotive business.
NXP has also received regulatory approvals for its acquisition of Kinara, which makes high performance, energy-efficient and programmable discrete neural processing units, and is working to close the transaction.
The Dutch firm expects fourth-quarter revenue in the range of $3.20 billion to 3.40 billion, with the midpoint coming in above analysts’ average estimate of $3.24 billion, according to data compiled by LSEG.
“Our outlook reflects the strength of our company specific growth drivers and signs of a cyclical recovery,” incoming CEO Rafael Sotomayor said in a statement.
For the third quarter ended September 28, NXP posted revenue of $3.17 billion, ahead of an estimate of $3.16 billion.
Revenue from the automotive segment – NXP’s biggest – grew 6% sequentially in the quarter. Mobile revenue was up 30%.
(Reporting by Juby Babu in Mexico City; Editing by Maju Samuel)
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