NXP raised its guidance for the third quarter based on better-than-expected performance, particularly in its automotive and mobile end markets.
“Today, based on preliminary financial information, we are pleased to announce a significant improvement in our outlook for the third quarter of 2020. Relative to the mid-point of our guidance, we experienced material improvement in demand across all end markets, but particularly in the Automotive and Mobile end markets,” Kurt Sievers, NXP president and CEO, said in a statement.
The company said it sees revenue for the quarter coming in even with a year ago, at $2.267 billion, vs. previous expectations of a 12% decline. It said non-GAAP operating income for the period will be $586 million compared with previous expectations of $444 million.
"Additionally, demand improved in both our direct and distribution channels. The business environment has improved at a faster than anticipated pace, driving a broad-based increase in revenue, which also enabled higher gross margin. Given the improved outlook, we increased operating expenses in relation to non-executive variable incentive compensation, which taken together, resulted in operating profit margin substantially above guidance," Sievers said.
However, Jim Cramer said that he still prefers Marvell over NXP.
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