NXP partners with Amazon’s cloud unit as it sees improving revenue

NXP forecasts revenue in the range of $2.375bn to 2.525bn in the fourth quarter

Following its strong quarterly results, Dutch chipmaker NXP Semiconductors has entered into a strategic relationship with Amazon’s cloud computing business focussing on connecting cars with data centres.

The collaboration will involve making a new NXP chip designed to aggregate data from a car’s systems and send it over the internet to work better with Amazon’s data centres.

It comes as NXP pre-announced its quarterly results in October where automotive accounted for 47 per cent of NXP’s revenue in 2019, while mobile contributed the least, at 13 per cent.

In mobile, the company launched new products for specific customers raising NXP’s total revenue to $2.27bn (£1.71bn, €1.91bn), $267m above the midpoint of its original forecast range.

For example, Samsung will use NXP’s secure ultra-wideband and mobile wallet on the Galaxy Fold and Note 20 Ultra. If Samsung uses NXP for other products investors think the mobile division will grow rapidly in 2021

Mobile revenue grew by five per cent year on year to $337m but did not benefit from any shipment ban associated with Huawei.

NXP posted an improving revenue trend in the third quarter from the downtrend in the first quarter of the year.

The company forecasts revenue in the range of $2.375bn to 2.525bn in the fourth quarter. 

Net income will be in the range of $425m to $499m. 

This guidance already excludes the impact of Huawei. If the US government grants it licences, then it may include shipments to Huawei in the next year.

More details about NXP’s partnership with Amazon will be presented online on November 19.

FURTHER READING: Honda takes self-driving car to next Level

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