NXP Semiconductors NV at Nasdaq Investor Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Blayne Curtis - Jefferies - Analyst : And I think having just initiated, when I'm not talking about NVIDIA, the question is definitely analog. We've been very positive on that area. So I thought maybe just a way to start off, just kind of your perspective, where we are, because I get that question asked all the time, where we are in the cycle. You definitely have had some comments. Every company's a bit different, but kind of where are you seeing it for NXP in the industry? Then we'll get into some more of the questions.

Question: Blayne Curtis - Jefferies - Analyst : Perfect. I do want to ask you about the actual auto market. So you're now shipping below demand. I think I get this a lot for investors. During the pandemic, I think people were cash flush. They bought loaded cars, that's all that was on the lots. So it's kind of the question is just, are people's wallets smaller, or are you worried about just sales of autos? And then in terms of the mix of cars, semicontent's rising, but I think maybe there was a mix of certain features that maybe was overexaggerated during the pandemic. Kind of just your perspective on both of those.

Question: Blayne Curtis - Jefferies - Analyst : I'm curious, being an analyst in the US, Chinese auto OEMs are not in the US, but marketing around now that I've initiated, and you're even seeing some in Canada, in Europe, meeting investors. That's actually a big thing, where they see these cars. They're actually quite feature heavy and good price point. I'm kind of just curious in terms of the success of Chinese EVs globally, what's your perspective? And then from NXP, your content in those cars versus global.

Question: Blayne Curtis - Jefferies - Analyst : Right. And I guess the natural follow on, and I get this is probably the number-one pushback to the whole analog group, is the concept of Chinese localization. So it's an auto question, but actually broader as well. It does focus -- you're not in the silicon carbide market, which is one hot area of it. But there are areas, microcontrollers and such, where you might see it. What are you seeing in terms of Chinese competition?

Question: Blayne Curtis - Jefferies - Analyst : And I want to ask you, we're going to run out of time. So in terms of growth, there's a lot to talk about, but the growth drivers within auto, I mean, you've done a good job highlighting these at the end of the day, radar, domain zonal controllers. So people might not fully understand what that is, but it was a big $1 billion plus opportunity for yourself. And maybe you could just update us in terms of the progress there and the multiple growth drivers.

Question: Blayne Curtis - Jefferies - Analyst : This question is for either you or Bill, but just in terms of going back to the cycle, you navigate the cycle, I would say, better than anybody in terms of you're not really even down. Most are down 20%, 30%. So you mentioned how you kept the supply chain lean. I'm kind of curious, in terms of your view coming out of it, you've talked about adding back to the disty channel. What are you looking for? I mean, it sounds like you're through it, you didn't even see a decline, and you're talking about hopefully autos cleaned up by Q2. So what else are you looking for for the rest of the year to kind of add back that inventory disties?

Question: Blayne Curtis - Jefferies - Analyst : That's actually a perfect leading, because I was going to ask Bill on the gross margin. So you are trying to bring down your own inventories, but you're actually starting to see your volumes take off. So in terms of the gross margin for the rest of the year, are you going to be able to show some improvement? I mean, obviously, overall volumes help. But kind of the counterbalancing is to bring down the inventories.

Question: Blayne Curtis - Jefferies - Analyst : Perfect. With that, we're out of time. Went by quick. Thank you.