NXP spots “early innings” of recovery

NXP is seeing the “early innings” of a cyclical recovery, CEO Kurt Sievers said at the JP Morgan Global Technology, Media and Communications conference last week in Boston. The chipmaker and peers saw an uptick in orders recently, but some industry observers have attributed these to pull-ins related to the instigation (and subsequent 90-day reprieve) of tariffs announced by the Trump administration. According to Sievers, this isn’t the case, although the uncertainty related to trade deals still permeates the supply chain and end-markets.

“The improvement in the order patterns and some early supply escalations, we really think is a sign of a cycle recovery,” Sievers said, adding that he’s not ready to start shouting the uptick from the rooftops. “We still believe that the uncertainty from the tariffs is such a massive crosscurrent that we try to be cautious. We got it wrong last year. We don’t want to get it wrong again.”

In August last year, NXP announced that it had “navigated the cyclical trough in our businesses,” only to backtrack in Q3. The unexpected malaise started in the Industrial & IoT markets, but Automotive soon joined in the misery.

Sievers’ optimism is backed by industry peers. “Against a backdrop of global trade volatility, our performance reflects the ongoing cyclical recovery and the strength and resiliency of our business model,” said Analog Devices CEO Vincent Roche, discussing Q2 results last week. Texas Instruments CEO Haviv Ilan sees “more and more evidence and signals that across all channels, all geographies, a recovery of the industrial market is here.”