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NXP Semiconductors Reports Third Quarter 2013 Results

EINDHOVEN, THE NETHERLANDS -- (Marketwired) -- Oct 23, 2013 -- NXP Semiconductors N.V. (NASDAQ: NXPI)

                                                                            
                                                              Q3 2013       
                                                        ------------------  
Revenue                                                 $    1,249 million  
GAAP Gross margin                                                     45.6% 
GAAP Operating margin                                                 13.5% 
GAAP Diluted earnings per share                         $             0.60  
                                                                            
Non-GAAP Gross margin                                                 46.8% 
Non-GAAP Operating margin                                             22.8% 
Non-GAAP Diluted earnings per share                     $             0.85  
                                                                            

NXP Semiconductors N.V. (NASDAQ: NXPI) today reported financial results for the third quarter of 2013, ended September 29, 2013, and provided guidance for the fourth quarter 2013.

"Our revenue results for the third quarter of 2013 came in essentially in-line with the mid-point of our guidance, as NXP delivered Product revenue of $1,213 million, approximately a five percent sequential increase, and an eight percent increase from the comparable prior year period. Total NXP revenue in the third quarter was $1,249 million, a five percent sequential increase, and nearly a seven percent increase from the comparable year ago period," said Richard Clemmer, NXP Chief Executive Officer.

"Our revenue performance during the quarter reflected record revenue across nearly all of our HPMS end-markets as segment growth achieved nearly 15% year-on-year growth. We experienced particularly strong growth in our Infrastructure & Industrial and our Portable & Computing businesses, a result of new design wins ramping into production. Our Automotive business delivered good sequential growth due to better than seasonal demand, combined record sales of our entertainment and keyless-entry products, along with strong sequential growth of in-vehicle networking products. Our Identification business delivered in-line performance, as we experienced the anticipated pause in banking and mobile transaction programs, offset by good demand for our secure identification products. The revenue performance of the Standard products segment was slightly below our expectations as a result of weaker than expected demand in mobile for both the Logic and Discrete businesses.

"From an earnings perspective, we exceeded guidance due to a combination of significantly improved sequential gross margin within our Standard Products segment, better HPMS gross margin, and good overall operating expense control. We are pleased to see the operational challenges in our Standard Products segment resolved, and the group making good progress toward our long-term model. Taken together, our above market growth and improving margin performance resulted in 20 percent non-GAAP free cash flow margin during the quarter, a new record for NXP. Our strategy of providing unique and differentiated product solutions continues to resonate with our customers, and should result in continued long-term growth in excess of the overall end market," said Clemmer.

Summary of Third Quarter 2013 Results ($ millions, except EPS, unaudited)

                                                                            
                         Q3 2013     Q2 2013     Q3 2012     Q - Q    Y - Y 
                        ---------   ---------   ---------   ------   ------ 
                                                                            
Product Revenue         $   1,213   $   1,159   $   1,120        5%       8%
Manufacturing                                                               
 Operations             $      36   $      29   $      49       24%     -27%
Corporate & Other       $       -   $       -   $       1       NM       NM 
                        ---------   ---------   ---------                   
Total Revenue           $   1,249   $   1,188   $   1,170        5%       7%
GAAP Gross Profit       $     570   $     535   $     536        7%       6%
  Gross Profit                                                              
   Adjustments (1)      $     (15)  $      (5)  $      (7)                  
Non-GAAP Gross Profit   $     585   $     540   $     543        8%       8%
  GAAP Gross Margin            46%         45%         46%                  
  Non-GAAP Gross Margin        47%         46%         46%                  
GAAP Operating Income   $     168   $     170   $     168       -1%       0%
  Operating Income                                                          
   Adjustments (1)           (117)        (86)        (76)                  
Non-GAAP Operating                                                          
 Income                 $     285   $     256   $     244       11%      17%
  GAAP Operating Margin        13%         14%         14%                  
  Non-GAAP Operating                                                        
   Margin                      23%         22%         21%                  
GAAP Net Income /                                                           
 (Loss)                 $     155   $     111   $     115       40%      35%
  Net Income                                                                
   Adjustments (1)            (64)        (71)        (39)                  
Non-GAAP Net Income /                                                       
 (Loss)                 $     219   $     182   $     154       20%      42%
GAAP EPS                $    0.60   $    0.43   $    0.45       40%      33%
  EPS Adjustments (1)   $   (0.25)  $   (0.28)  $   (0.16)                  
Non-GAAP EPS            $    0.85   $    0.71   $    0.61       20%      39%
                                                                            

1. Please see "Discussion of GAAP to non-GAAP Reconciliation" on page 3 of this release.

Supplemental Information ($ millions, unaudited)

                                                                            
                                                 Percent                    
                                                    Q3                      
                       Q3 2013  Q2 2013  Q3 2012  Total     Q - Q    Y - Y  
                      -------- -------- -------- -------   ------   ------  
  Automotive          $    261 $    253 $    239      21%       3%       9% 
  Identification      $    329 $    339 $    275      26%      -3%      20% 
  Infrastructure &                                                          
   Industrial         $    202 $    180 $    171      16%      12%      18% 
  Portable &                                                                
   Computing          $    130 $    106 $    119      10%      23%       9% 
                      -------- -------- -------- -------                    
High Performance                                                            
 Mixed Signal (HPMS)  $    922 $    878 $    804      74%       5%      15% 
Standard Products                                                           
 (STDP)               $    291 $    281 $    316      23%       4%      -8% 
                      -------- -------- -------- -------                    
Product Revenue       $  1,213 $  1,159 $  1,120      97%       5%       8% 
Manufacturing                                                               
 Operations           $     36 $     29 $     49       3%      24%     -27% 
Corporate & Other     $      - $      - $      1       0%      NM       NM  
                      -------- -------- -------- -------                    
Total Revenue         $  1,249 $  1,188 $  1,170     100%       5%       7% 
                                                                            

Product Revenue is the combination of revenue from the High Performance Mixed Signal (HPMS) and Standard Products (STDP) segments. Percent of quarterly total amounts may not add to 100 percent due to rounding.

Additional and Subsequent Information for the Third Quarter of 2013:

Guidance for the Fourth Quarter 2013: ($ millions, except share count and EPS) (1)

                                                                            
                                                 Guidance Range             
                                          Low          Mid         High     
                                      ----------   ----------   ----------  
                                                                            
Product Revenue                       $    1,189   $    1,231   $    1,256  
  Q-Q                                         -2%           1%           4% 
Mfg. & Other Revenue                  $       34   $       34   $       34  
                                      ----------   ----------   ----------  
Total Revenue                         $    1,223   $    1,265   $    1,290  
  Q-Q                                         -2%           1%           3% 
Non-GAAP Gross Profit                 $      594   $      624   $      645  
  Non-GAAP Gross Margin                       49%          49%          50% 
Non-GAAP Operating Income             $      288   $      312   $      332  
  Non-GAAP Operating Margin                   24%          25%          26% 
  Interest Expense                    $       40   $       40   $       40  
  Cash Taxes                          $       13   $       13   $       13  
  Non-controlling Interest            $       17   $       17   $       17  
                                      ----------   ----------   ----------  
Non-GAAP Net Income                   $      218   $      242   $      262  
Ave. Diluted Shares                          256          256          256  
  Non - GAAP EPS                      $     0.85   $     0.95   $     1.02  
                                                                            

Note (1): NXP has based the guidance included in this release on judgments and estimates that management believes are reasonable given its assessment of historical trends and other information reasonably available as of the date of this release. The guidance included in this release consists of predictions only, and is subject to a wide range of known and unknown risks and uncertainties, many of which are beyond NXP's control. The guidance included in this release should not be regarded as representations by NXP that the estimated results will be achieved. Actual results may vary materially from the guidance we provide today. In relation to the use of non-GAAP financial information see the note regarding "Use of Non-GAAP Financial Information" elsewhere in this release. For the factors, risks and uncertainties to which judgments, estimates and forward-looking statements generally are subject see the note regarding "Forward-looking Statements." We undertake no obligation to publicly update or revise any forward-looking statements, including the guidance set forth herein, to reflect future events or circumstances. Considering the uncertain magnitude and variability of the foreign exchange consequences upon "PPA effects", "restructuring costs", "other incidental items" and any interest expense or taxes in future periods, management believes that GAAP financial measures are not available for NXP without unreasonable efforts on a forward looking basis.

Discussion of GAAP to non-GAAP Reconciliations

In addition to providing financial information on a basis consistent with U.S. generally accepted accounting principles ("GAAP"), NXP also provides the following selected financial measures on a non-GAAP basis: (i) "non-GAAP gross profit," (ii) "non-GAAP gross margin," (iii) "non-GAAP Research and development," (iv) "non-GAAP Selling, general and administrative," (v) non-GAAP Other income," (vi) "non-GAAP operating income (loss)," (vii) "non-GAAP operating margin," (viii) "non-GAAP net income/ (loss)," (ix) "PPA effects," (x) "Restructuring costs," (xi) "Stock based compensation," (xii) "Other incidental items," (xiii) "non-GAAP Financial Income (expense)," (xiv) "non-GAAP Results relating to equity-accounted investees," (xv) "non-GAAP Cash tax (expense)," (xvi) "non-GAAP EPS," (xvii) "EBITDA," "adjusted EBITDA" and "trailing 12 month adjusted EBITDA," (xviii) "net debt" and (xix) "non-GAAP free cash flow."

In this release, references to:

Reconciliations of these non-GAAP measures to the most comparable measures calculated in accordance with GAAP are provided in the financial statements portion of this release in a schedule entitled "Financial Reconciliation of GAAP to non-GAAP Results (unaudited)."

NXP provides non-GAAP measures because management believes that they are helpful to understand the underlying operating and profit structure of NXP's operations, to provide additional insight as to how management assesses the performance and allocation of resources among its various segments and because the financial community uses them in its analysis of NXP's operating and/or financial performance, historical results and projections of NXP's future operating results. NXP presents "non-GAAP gross profit," "non-GAAP research and development," "non-GAAP Selling, general and administrative," "non-GAAP Other income," "non-GAAP operating income," "non-GAAP net income/ (loss)," "non-GAAP gross margin," "non-GAAP operating margin" and "non-GAAP EPS" because these financials measures are net of "PPA effects," "restructuring costs," "stock based compensation," "other incidental items," and "other adjustments" which have affected the comparability of NXP's results over the years. NXP presents "EBITDA," "adjusted EBITDA" and "trailing 12 month adjusted EBITDA" because these financials measures enhance an investor's understanding of NXP's financial performance.

Non-GAAP measures should not be considered a substitute for any information derived or calculated in accordance with GAAP, are not intended to be measures of financial performance or condition, liquidity, profitability or operating cash flows in accordance with GAAP, and should not be considered as alternatives to net income (loss), operating income or any other performance measures determined in accordance with GAAP. These non-GAAP measures can vary from other participants in the semiconductor industry. They have limitations as analytical tools and should not be considered in isolation for analysis of NXP's financial results as reported under GAAP.

Conference Call and Webcast Information

NXP will host a conference call on October 24, 2013 at 8:00 a.m. U.S. Eastern Daylight Time (2:00 p.m. Central European Central Time) to discuss its third quarter 2013 financial results and provide an outlook for the fourth quarter of 2013.

Interested parties may join the conference call by dialing 1 - 800 - 688 - 0836 (within the U.S.) or 1 - 617 - 614 - 4072 (outside the U.S.). The participant pass-code is 33604871. To listen to a webcast of the event, please visit the Investor Relations section of the NXP website at www.nxp.com/investor. The webcast will be recorded and available for replay shortly after the call concludes.

About NXP Semiconductors

NXP Semiconductors N.V. (NASDAQ: NXPI) creates solutions that enable secure connections for a smarter world. Building on its expertise in High Performance Mixed Signal electronics, NXP is driving innovation in the automotive, identification and mobile industries, and in application areas including wireless infrastructure, lighting, healthcare, industrial, consumer tech and computing. NXP has operations in more than 25 countries, and posted revenue of $4.36 billion in 2012. Find out more at www.nxp.com.

Forward-looking Statements

This document includes forward-looking statements which include statements regarding NXP's business strategy, financial condition, results of operations, and market data, as well as any other statements which are not historical facts. By their nature, forward-looking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. These factors, risks and uncertainties include the following: market demand and semiconductor industry conditions; the ability to successfully introduce new technologies and products; the end-market demand for the goods into which NXP's products are incorporated; the ability to generate sufficient cash, raise sufficient capital or refinance corporate debt at or before maturity; the ability to meet the combination of corporate debt service, research and development and capital investment requirements; the ability to accurately estimate demand and match manufacturing production capacity accordingly or obtain supplies from third-party producers; the access to production capacity from third-party outsourcing partners; any events that might affect third-party business partners or NXP's relationship with them; the ability to secure adequate and timely supply of equipment and materials from suppliers; the ability to avoid operational problems and product defects and, if such issues were to arise, to correct them quickly; the ability to form strategic partnerships and joint ventures and to successfully cooperate with alliance partners; the ability to win competitive bid selection processes to develop products for use in customers' equipment and products; the ability to successfully establish a brand identity; the ability to successfully hire and retain key management and senior product architects; and, the ability to maintain good relationships with our suppliers. In addition, this document contains information concerning the semiconductor industry and NXP's business segments generally, which is forward-looking in nature and is based on a variety of assumptions regarding the ways in which the semiconductor industry, NXP's market segments and product areas may develop. NXP has based these assumptions on information currently available, if any one or more of these assumptions turn out to be incorrect, actual market results may differ from those predicted. While NXP does not know what impact any such differences may have on its business, if there are such differences, its future results of operations and its financial condition could be materially adversely affected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak to results only as of the date the statements were made. Except for any ongoing obligation to disclose material information as required by the United States federal securities laws, NXP does not have any intention or obligation to publicly update or revise any forward-looking statements after we distribute this document, whether to reflect any future events or circumstances or otherwise. For a discussion of potential risks and uncertainties, please refer to the risk factors listed in our SEC filings. Copies of our SEC filings are available on our Investor Relations website, www.nxp.com/investor or from the SEC website, www.sec.gov.

                                                                            
NXP Semiconductors                                                          
Table 1: Condensed consolidated statement of operations (unaudited)         
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions except share data)                Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
                                                                            
Revenue                                  $    1,249  $    1,188  $    1,170 
                                                                            
Cost of revenue                                (679)       (653)       (634)
                                         ----------  ----------  ---------- 
                                                                            
Gross profit                                    570         535         536 
                                                                            
Research and development                       (163)       (155)       (153)
Selling, general and administrative            (239)       (211)       (236)
                                         ----------  ----------  ---------- 
Total operating expenses                       (402)       (366)       (389)
                                                                            
Other income (expense)                            -           1          21 
                                         ----------  ----------  ---------- 
                                                                            
Operating income (loss)                         168         170         168 
                                                                            
Financial income (expense):                                                 
  Interest income (expense) - net               (44)        (47)        (65)
  Foreign exchange gain (loss)                   52          32          48 
  Gain (loss) on extinguishment of long                                     
   term debt                                      -         (23)        (11)
  Other financial expense                        (5)         (8)         (5)
                                         ----------  ----------  ---------- 
                                                                            
Income (loss) before taxes                      171         124         135 
                                                                            
Benefit (provision) for income taxes             (1)          2          (6)
Results relating to equity-accounted                                        
 investees                                        2           3           2 
                                         ----------  ----------  ---------- 
                                                                            
Income (loss) from continuing operations        172         129         131 
Income (loss) on discontinued                                               
 operations, net of tax                           -           -           - 
                                         ----------  ----------  ---------- 
Net income (loss)                               172         129         131 
Net (income) loss attributable to non-                                      
 controlling interests                          (17)        (18)        (16)
                                         ----------  ----------  ---------- 
Net income (loss) attributable to                                           
 stockholders                                   155         111         115 
                                                                            
Earnings per share data:                                                    
Net income (loss) attributable to                                           
 stockholders per common share                                              
                                                                            
Basic earnings per common share in $     $     0.62  $     0.44  $     0.46 
Diluted earnings per common share in $   $     0.60  $     0.43  $     0.45 
                                                                            
Weighted average number of shares of                                        
 common stock (in thousands):                                               
Basic                                       248,794     249,449     247,498 
Diluted                                     256,777     255,265     253,060 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 2: Condensed consolidated balance sheet (unaudited)                   
                                                                            
----------------------------------------------------------------------------
                                                                            
($ in millions)                                         As of               
                                         -----------------------------------
                                          Sept. 29,    June 30,   Sept. 30, 
                                             2013        2013        2012   
                                         ----------- ----------- -----------
                                                                            
Current assets:                                                             
  Cash and cash equivalents              $       941 $       569 $       702
  Accounts receivable - net                      530         495         470
  Other receivables                               52          49          15
  Assets held for sale                             9          10           8
  Inventories                                    754         742         671
  Other current assets                           127         132         105
                                         ----------- ----------- -----------
Total current assets                           2,413       1,997       1,971
                                                                            
Non-current assets:                                                         
  Investments in equity-accounted                                           
   investees                                      50          47          42
  Other non-current assets                       139         128         144
  Property, plant and equipment                1,032       1,030       1,086
  Identified intangible assets                   792         841       1,017
  Goodwill                                     2,318       2,253       2,241
                                         ----------- ----------- -----------
Total non-current assets                       4,331       4,299       4,530
                                                                            
Total assets                                   6,744       6,296       6,501
                                                                            
Current liabilities:                                                        
  Accounts payable                               545         521         549
  Liabilities held for sale                        -           -           3
  Accrued liabilities                            595         610         513
  Short-term debt                                465          50         244
                                         ----------- ----------- -----------
Total current liabilities                      1,605       1,181       1,309
                                                                            
Non-current liabilities:                                                    
  Long-term debt                               3,232       3,331       3,338
  Other non-current liabilities                  469         451         450
                                         ----------- ----------- -----------
Total non-current liabilities                  3,701       3,782       3,788
                                                                            
Non-controlling interests                        236         219         217
Stockholders' equity                           1,202       1,114       1,187
                                         ----------- ----------- -----------
Total equity                                   1,438       1,333       1,404
                                                                            
Total liabilities and equity                   6,744       6,296       6,501
                                                                            
----------------------------------------------------------------------------
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 3: Condensed consolidated statement of cash flows (unaudited)         
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions)                                  Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
                                                                            
Cash Flows from operating activities                                        
Net income (loss)                        $      172  $      129  $      131 
Adjustments to reconcile net income                                         
 (loss):                                                                    
  Depreciation and amortization                 137         132         128 
  Stock-based compensation                       20          20          12 
  Net (gain) loss on sale of assets               -          (1)        (19)
  (Gain) loss on extinguishment of debt           -          23          11 
  Results relating to equity accounted                                      
   investees                                     (2)         (3)         (2)
Changes in operating assets and                                             
 liabilities:                                                               
  (Increase) decrease in trade                                              
   receivables                                  (20)        (26)         (8)
  (Increase) decrease in inventories             (5)        (10)        (20)
  Increase (decrease) in trade payables          17           6          19 
  (Increase) decrease in other                                              
   receivables                                    3          (4)          3 
  Increase (decrease) in other payables          29         (78)        (22)
  Changes in deferred taxes                       -           1           - 
Exchange differences                            (52)        (32)        (48)
Other items                                      (1)          3           7 
                                         ----------  ----------  ---------- 
Net cash provided by (used for)                                             
 operating activities                           298         160         192 
                                                                            
Cash flows from investing activities:                                       
  Purchase of identified intangible                                         
   assets                                       (10)        (11)         (7)
  Capital expenditures on property,                                         
   plant and equipment                          (54)        (49)        (92)
  Proceeds from disposals of property,                                      
   plant and equipment                            -           3           - 
  Proceeds from sale of interests in                                        
   businesses                                     -           -          27 
  Purchase of interests in businesses            (1)          -           - 
  Proceeds from return of equity                                            
   investment                                     -           1           - 
  Other                                          (1)          -           1 
                                         ----------  ----------  ---------- 
Net cash (used for) provided by                                             
 investing activities                           (66)        (56)        (71)
                                                                            
Cash flows from financing activities:                                       
  Net (repayments) borrowings of short-                                     
   term debt                                     (7)         (1)          4 
  Repayments under the revolving credit                                     
   facility                                    (175)       (155)       (200)
  Amounts drawn under the revolving                                         
   credit facility                                -         200           - 
  Repurchase of long-term debt                    -        (874)        (59)
  Principal payments on long-term debt           (2)         (5)         (5)
  Net proceeds from the issuance of                                         
   long-term debt                               495         742           - 
  Dividends paid to non-controlling                                         
   interests                                    (47)          -          (1)
  Cash proceeds from exercise of stock                                      
   options                                       29          10           6 
  Purchase of treasury shares                  (159)        (48)         (3)
                                         ----------  ----------  ---------- 
Net cash provided by (used for)                                             
 financing activities                           134        (131)       (258)
                                                                            
Net cash provided by (used for)                                             
 continuing operations                          366         (27)       (137)
                                                                            
Effect of changes in exchange rates on                                      
 cash positions                                   6           1           2 
                                         ----------  ----------  ---------- 
Increase (decrease) in cash and cash                                        
 equivalents                                    372         (26)       (135)
Cash and cash equivalents at beginning                                      
 of period                                      569         595         837 
                                         ----------  ----------  ---------- 
Cash and cash equivalents at end of                                         
 period                                         941         569         702 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 4: Reconciliation of GAAP to non-GAAP Segment Results (unaudited)     
                                                                            
--------------------------------------------------------------------------- 
                                                                            
($ in millions)                                  Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
                                                                            
High Performance Mixed Signal (HPMS)            922         878         804 
Standard Products                               291         281         316 
                                         ----------  ----------  ---------- 
  Product Revenue                             1,213       1,159       1,120 
    Manufacturing Operations                     36          29          49 
    Corporate and Other                           -           -           1 
                                         ----------  ----------  ---------- 
Total Revenue                            $    1,249  $    1,188  $    1,170 
                                         ==========  ==========  ========== 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
HPMS Revenue                             $      922  $      878  $      804 
  Percent of Total Revenue                     73.8%       73.9%       68.7%
  HPMS segment GAAP gross profit                493         472         433 
    PPA effects                                   -           -          (1)
    Restructuring                                (4)          3           - 
    Stock based compensation                     (1)         (2)         (1)
    Other incidentals                            (1)         (1)         (1)
    Other adjustments                             -           -           - 
                                         ----------  ----------  ---------- 
  HPMS segment non-GAAP gross profit     $      499  $      472  $      436 
                                         ==========  ==========  ========== 
                                                                            
    HPMS segment GAAP gross margin             53.5%       53.8%       53.9%
    HPMS segment non-GAAP gross margin         54.1%       53.8%       54.2%
                                                                            
  HPMS segment GAAP operating profit            184         178         157 
    PPA effects                                 (46)        (45)        (45)
    Restructuring                                (4)          3           1 
    Stock based compensation                    (16)        (16)         (9)
    Other incidentals                            (1)         (2)         16 
    Other adjustments                             -           -           - 
                                         ----------  ----------  ---------- 
  HPMS segment non-GAAP operating profit $      251  $      238  $      194 
                                         ==========  ==========  ========== 
                                                                            
    HPMS segment GAAP operating margin         20.0%       20.3%       19.5%
    HPMS segment non-GAAP operating                                         
     margin                                    27.2%       27.1%       24.1%
                                                                            
                                                                            
--------------------------------------------------------------------------- 
                                                                            
Standard Products Revenue                $      291  $      281  $      316 
  Percent of Total Revenue                     23.3%       23.7%       27.0%
  Standard Products segment GAAP gross                                      
   profit                                        81          68         107 
    PPA effects                                   -           -          (1)
    Restructuring                                (2)          5           1 
    Stock based compensation                      -          (1)          - 
    Other incidentals                            (2)         (3)          - 
                                         ----------  ----------  ---------- 
  Standard Products segment non-GAAP                                        
   gross profit                          $       85  $       67  $      107 
                                         ==========  ==========  ========== 
                                                                            
    Standard Products segment GAAP gross                                    
     margin                                    27.8%       24.2%       33.9%
    Standard Products segment non-GAAP                                      
     gross margin                              29.2%       23.8%       33.9%
                                                                            
  Standard Products segment GAAP                                            
   operating profit                              21           9          43 
    PPA effects                                 (14)        (15)        (15)
    Restructuring                                (2)          5           - 
    Stock based compensation                     (4)         (4)         (2)
    Other incidentals                            (2)         (3)          2 
                                         ----------  ----------  ---------- 
  Standard Products segment non-GAAP                                        
   operating profit                      $       43  $       26  $       58 
                                         ==========  ==========  ========== 
                                                                            
    Standard Products segment GAAP                                          
     operating margin                           7.2%        3.2%       13.6%
    Standard Products segment non-GAAP                                      
     operating margin                          14.8%        9.3%       18.4%
                                                                            
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 4: Reconciliation of GAAP to non-GAAP Segment Results (unaudited)     
 (con't)                                                                    
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions)                                  Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
Manufacturing Operations Revenue         $       36  $       29  $       49 
  Percent of Total Revenue                      2.9%        2.4%        4.2%
  Manufacturing Operations segment GAAP                                     
   gross profit                                  (4)         (6)         (2)
    PPA effects                                  (2)         (3)         (2)
    Restructuring                                (1)         (2)         (1)
    Stock based compensation                      -           -           - 
    Other incidentals                            (2)         (1)         (1)
                                         ----------  ----------  ---------- 
  Manufacturing Operations segment non-                                     
   GAAP gross profit                     $        1  $        -  $        2 
                                         ==========  ==========  ========== 
                                                                            
    Manufacturing Operations segment                                        
     GAAP gross margin                        -11.1%      -20.7%       -4.1%
    Manufacturing Operations segment                                        
     non-GAAP gross margin                      2.8%        0.0%        4.1%
                                                                            
  Manufacturing Operations segment GAAP                                     
   operating profit                              (9)        (10)         (6)
    PPA effects                                  (6)         (6)         (5)
    Restructuring                                (1)         (2)         (1)
    Stock based compensation                      -           -           - 
    Other incidentals                            (2)         (1)         (2)
                                         ----------  ----------  ---------- 
  Manufacturing Operations segment non-                                     
   GAAP operating profit                 $        -  $       (1) $        2 
                                         ==========  ==========  ========== 
                                                                            
    Manufacturing Operations segment                                        
     GAAP operating margin                    -25.0%      -34.5%      -12.2%
    Manufacturing Operations segment                                        
     non-GAAP operating margin                  0.0%       -3.4%        4.1%
                                                                            
                                                                            
--------------------------------------------------------------------------- 
                                                                            
Corporate and Other Revenue              $        -  $        -  $        1 
  Percent of Total Revenue                      0.0%        0.0%        0.1%
  Corporate and Other segment GAAP gross                                    
   profit                                         -           1          (2)
    PPA effects                                   -           -           - 
    Restructuring                                 -           -           - 
    Stock based compensation                      -           -           - 
    Other incidentals                             -           -           - 
                                         ----------  ----------  ---------- 
  Corporate and Other segment non-GAAP                                      
   gross profit                          $        -  $        1  $       (2)
                                         ==========  ==========  ========== 
                                                                            
  Corporate and Other segment GAAP gross                                    
   margin                                        NM          NM          NM 
  Corporate and Other segment non-GAAP                                      
   gross margin                                  NM          NM          NM 
                                                                            
  Corporate and Other segment GAAP                                          
   operating profit                             (28)         (7)        (26)
    PPA effects                                   -           -           - 
    Restructuring                               (16)          4          (4)
    Stock based compensation                      -           -          (1)
    Other incidentals                            (3)         (4)        (11)
                                         ----------  ----------  ---------- 
  Corporate and Other segment non-GAAP                                      
   operating profit                      $       (9) $       (7) $      (10)
                                         ==========  ==========  ========== 
                                                                            
  Corporate and Other segment GAAP                                          
   operating margin                              NM          NM          NM 
  Corporate and Other segment non-GAAP                                      
   operating margin                              NM          NM          NM 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 5: Financial Reconciliation of GAAP to non-GAAP Results (unaudited)   
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions except share data)               Three Months Ended          
                                       ------------------------------------ 
                                        Sept. 29,     June 30,    Sept. 30, 
                                          2013          2013        2012    
                                       ----------    ----------  ---------- 
                                                                            
Revenue                                $    1,249    $    1,188  $    1,170 
                                                                            
GAAP Gross profit                      $      570    $      535  $      536 
  PPA effects                                  (2)           (3)         (4)
  Restructuring                                (7)            6           - 
  Stock Based Compensation                     (1)           (3)         (1)
  Other incidentals                            (5)           (5)         (2)
  Other adjustments                             -             -           - 
                                       ----------    ----------  ---------- 
Non-GAAP Gross profit                  $      585    $      540  $      543 
                                       ==========    ==========  ========== 
                                                                            
GAAP Gross margin                            45.6%         45.0%       45.8%
                                                                            
Non-GAAP Gross margin                        46.8%         45.5%       46.4%
                                                                            
  GAAP Research and development        $     (163)   $     (155) $     (153)
    PPA effects                                 -             -           - 
    Restructuring                               -             -           - 
    Stock based compensation                   (3)           (2)         (1)
    Other incidentals                           -            (1)         (3)
                                       ----------    ----------  ---------- 
  Non-GAAP Research and development    $     (160)   $     (152) $     (149)
                                       ==========    ==========  ========== 
                                                                            
  GAAP Selling, general and                                                 
   administrative                      $     (239)   $     (211) $     (236)
    PPA effects                               (64)          (63)        (61)
    Restructuring                             (16)            4          (4)
    Stock based compensation                  (16)          (15)        (10)
    Other incidentals                          (3)           (4)        (10)
                                       ----------    ----------  ---------- 
  Non-GAAP Selling, general and                                             
   administrative                      $     (140)   $     (133) $     (151)
                                       ==========    ==========  ========== 
                                                                            
  GAAP Other income (expense)          $        -    $        1  $       21 
    PPA effects                                 -             -           - 
    Restructuring                               -             -           - 
    Other incidentals                           -             -          20 
                                       ----------    ----------  ---------- 
  Non-GAAP Other income (expense)      $        -    $        1  $        1 
                                       ==========    ==========  ========== 
                                                                            
GAAP Operating income (loss)           $      168    $      170  $      168 
  PPA effects                                 (66)          (66)        (65)
  Restructuring                               (23)           10          (4)
  Stock based compensation                    (20)          (20)        (12)
  Other incidentals                            (8)          (10)          5 
  Other adjustments                             -             -           - 
                                       ----------    ----------  ---------- 
Non-GAAP Operating income (loss)       $      285    $      256  $      244 
                                       ==========    ==========  ========== 
                                                                            
GAAP Operating margin                        13.5%         14.3%       14.4%
                                                                            
Non-GAAP Operating margin                    22.8%         21.5%       20.9%
                                                                            
GAAP Financial income (expense)        $        3    $      (46) $      (33)
  Foreign exchange gain (loss) on debt         52            32          48 
  Gain (loss) on extinguishment of                                          
   long term debt                               -           (23)        (11)
  Other financial expense                      (5)           (8)         (5)
                                       ----------    ----------  ---------- 
Non-GAAP Financial income (expense)    $      (44)   $      (47) $      (65)
                                       ==========    ==========  ========== 
                                                                            
GAAP Income tax benefit (provision)    $       (1)   $        2  $       (6)
  Other adjustments                             4            11           3 
                                       ----------    ----------  ---------- 
Non-GAAP Cash tax (expense)            $       (5)   $       (9) $       (9)
                                       ==========    ==========  ========== 
                                                                            
GAAP Results relating to equity-                                            
 accounted investees                   $        2    $        3  $        2 
  Other adjustments                             2             3           2 
                                       ----------    ----------  ---------- 
Non-GAAP Results relating to equity-                                        
 accounted investees                   $        -    $        -  $        - 
                                       ==========    ==========  ========== 
                                                                            
GAAP Income (loss) from continuing                                          
 operations                            $      172    $      129  $      131 
  PPA effects                                 (66)          (66)        (65)
  Restructuring                               (23)           10          (4)
  Stock based compensation                    (20)          (20)        (12)
  Other incidentals                            (8)          (10)          5 
  Other adjustments                            53 1)         15          37 
                                       ----------    ----------  ---------- 
Non-GAAP Income (loss) from continuing                                      
 operations                            $      236    $      200  $      170 
                                       ==========    ==========  ========== 
                                                                            
                                                                            
GAAP Net income (loss) attributable to                                      
 stockholders                          $      155    $      111  $      115 
  PPA effects                                 (66)          (66)        (65)
  Restructuring                               (23)           10          (4)
  Stock based compensation                    (20)          (20)        (12)
  Other incidentals                            (8)          (10)          5 
  Other adjustments                            53            15          37 
                                       ----------    ----------  ---------- 
Non-GAAP Net income (loss)                                                  
 attributable to stockholders          $      219    $      182  $      154 
                                       ==========    ==========  ========== 
                                                                            
GAAP Weighted average shares - diluted    256,777       255,265     253,060 
  Non-GAAP Adjustment                           -             -           - 
                                       ----------    ----------  ---------- 
Non-GAAP Weighted average shares -                                          
 diluted                                  256,777       255,265     253,060 
                                       ==========    ==========  ========== 
                                                                            
GAAP Diluted net income (loss)                                              
 attributable to stockholders per                                           
 share                                 $     0.60    $     0.43  $     0.45 
Non-GAAP Diluted net income (loss)                                          
 attributable to stockholders per                                           
 share                                 $     0.85    $     0.71  $     0.61 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
1)  Includes: During 3Q13: Foreign exchange gain on debt: $52 million; Other
    financial expense: ($5) million; Results relating to equity-accounted   
    investees: $2 million; and difference between book and cash income      
    taxes: $4 million.                                                      
                                                                            
                                                                            
                                                                            
NXP Semiconductors                                                          
Table 6: Adjusted EBITDA and Free Cash Flow (unaudited)                     
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions)                                  Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
                                                                            
Net Income                               $      172  $      129  $      131 
                                         ==========  ==========  ========== 
                                                                            
Reconciling items to EBITDA                                                 
  Financial (income) expense                     (3)         46          33 
  (Benefit) provision for income taxes            1          (2)          6 
  Depreciation                                   63          61          59 
  Amortization                                   74          71          69 
                                         ----------  ----------  ---------- 
EBITDA                                   $      307  $      305  $      298 
                                         ==========  ==========  ========== 
                                                                            
Reconciling items to adjusted EBITDA                                        
  Results of equity-accounted investees          (2)         (3)         (2)
  Restructuring 1)                               17         (11)          3 
  Stock based compensation                       20          20          12 
  Other incidental items 1)                       8           9          (5)
  Other adjustments                               -           -           - 
                                         ----------  ----------  ---------- 
Adjusted EBITDA                          $      350  $      320  $      306 
                                         ==========  ==========  ========== 
                                                                            
Trailing twelve month adjusted EBITDA    $    1,279  $    1,235  $    1,030 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
1) Excluding depreciation property,                                         
 plant and equipment and amortization                                       
 software related to:                                                       
                                                                            
    Restructuring                                 6           1           1 
    Other incidental items                        -           1           - 
                                                                            
                                                                            
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            
($ in millions)                                  Three Months Ended         
                                         ---------------------------------- 
                                          Sept. 29,   June 30,    Sept. 30, 
                                            2013        2013        2012    
                                         ----------  ----------  ---------- 
                                                                            
Net cash provided by (used for)                                             
 operating activities                    $      298  $      160  $      192 
                                         ==========  ==========  ========== 
Net capital expenditures on property,                                       
 plant and equipment                            (54)        (46)        (92)
                                         ----------  ----------  ---------- 
                                                                            
Non-GAAP free cash flow                  $      244  $      114  $      100 
Non-GAAP free cash flow as a percent of                                     
 Revenue                                         20%         10%          9%
                                                                            
--------------------------------------------------------------------------- 
                                                                            
                                                                            

For further information, please contact:

Investors: 
Jeff Palmer 

jeff.palmer@nxp.com 
+1 408 518 5411 

Media:
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joon.knapen@nxp.com
+31 619 303 857