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Freescale Semiconductor Inc. (FSL)

  • Thu, Sep. 17, 1:10 PM
    • As expected, the EU has signed off on NXP's (NXPI +0.6%) pending cash/stock merger with Freescale (FSL +0.6%). Shares of both companies have risen slightly in response.
    • Regulators note the $1.8B sale of NXP's base station power amplifier unit to China's JAC Capital addresses antitrust concerns related to NXP/Freescale's combined base station amplifier share. The deal will still create a huge player in the microcontroller market - Gartner estimates Freescale and NXP were the market's #2 and #5 players in 2014 - but plenty of competition exists.
    | Thu, Sep. 17, 1:10 PM | 2 Comments
  • Tue, Sep. 8, 3:25 PM
    • The Philadelphia Semi Index (SOXX +3.9%) has risen to its highest levels since mid-August on a day the Nasdaq is posting a 2.3% gain.
    • Likely helping out: Microchip (MCHP +8.4%), still often seen as an industry bellwether (though its commentary accompanying last fall's warning sparked criticism), has adjusted its FQ2 (calendar Q3) revenue and EPS guidance to $545M-$563M ($554M midpoint) and $0.60-$0.66 from a prior $$532M-$569M ($550.5M midpoint) and $0.58-$0.66. The outlook comes after many chipmakers (Microchip included) offered below-consensus calendar Q3 guidance amid an inventory correction, weak PC demand, and slowing Chinese smartphone growth.
    • Microchip's core ops are said to be tracking in-line with prior expectations, and recently-acquired Micrel's above expectations. The 8.6M shares issued in the Micrel deal have been repurchased.
    • Also: Various Taiwanese chipmakers and supply chain firms have reported August sales. Chip packaging/testing firms ASE (ASX +5.9%) and Siliconware (SPIL +4.1%) respectively reported sales were up 5.8% and 5.7% M/M, and up 9.5% and down 4.2% Y/Y.
    • Big gainers include Microchip peers NXP (NXPI +6.8%), Freescale (FSL +5.8%), Silicon Labs (SLAB +4.4%), and Cypress (CY +4.4%). Others include Avago (AVGO +5.8%), Xilinx (XLNX +5.7%), Cavium (CAVM +5.5%), Analog Devices (ADI +6.3%), Synaptics (SYNA +5.4%), Linear (LLTC +4.6%), Cirrus Logic (CRUS +4.7%), IDT (IDTI +4.6%), Sigma Designs (SIGM +4.9%), and chip equipment maker Axcelis (ACLS +8%).
    • SanDisk, ON Semi, and Silicon Motion are benefiting from upgrades/bullish coverage. Apple holds its iPhone event at 1PM ET tomorrow.
    | Tue, Sep. 8, 3:25 PM | 1 Comment
  • Tue, Aug. 4, 2:33 PM
    • Apple is down 2.6% on strong volume (adding to recent post-earnings declines), and a slew of iPhone/iPad chip suppliers are also seeing major losses today. The Nasdaq is down just 0.3%, while the Philadelphia Semi Index is down 1.5%.
    • RF chipmakers Skyworks (SWKS -5.4%), Qorvo (QRVO -3.8%), and Avago (AVGO -3%) are among the decliners, as are audio codec supplier Cirrus Logic (CRUS -5.5%), motion sensor supplier InvenSense (INVN -5.7%), NFC/motion co-processor supplier NXP (NXPI -3.3%), and LCD driver supplier Synaptics (SYNA -3.8%). The selloff has occurred in the absence of major news
    • NXP merger partner Freescale (FSL -2.8%) is also off, as is chip packaging/testing firm Amkor (AMKR -4.2%), which has strong iPhone exposure. Earlier today, the EC announced NXP has offered concessions to win regulatory approval for the Freescale deal, which has a review deadline of Sep. 4. NXP has already agreed to sell its base station power amplifier unit for $1.8B to appease regulators.
    • InvenSense reports after the close. The other aforementioned names have already posted their calendar Q2 results.
    | Tue, Aug. 4, 2:33 PM | 48 Comments
  • Thu, Jul. 30, 1:40 PM
    • With many other chipmakers (including microcontroller rivals such as TI and Atmel) having already provided soft Q3 outlooks, NXP (NASDAQ:NXPI) is rallying in spite of providing light Q3 revenue guidance with its Q2 EPS beat and in-line sales. Merger partner Freescale (NYSE:FSL) is naturally along for the ride.
    • Cost controls helped NXP beat Q2 EPS estimates: GAAP operating expenses fell 1% Y/Y to $393M - R&D totaled $195M and SG&A $198M. Also: $162M was spent on buybacks, and gross margin (non-GAAP) rose 20 bps Q/Q and 10 bps Y/Y to 48.7% (above guidance of 48.5%). Q3 GM guidance is at 48.5%-49%.
    • iPhone NFC chip sales fueled a 39% Y/Y increase in Secure Connected Devices revenue to $276M. Apple M8 motion co-processor sales drove a 29% increase in secure interfaces/power revenue to $303M. Secure ID solutions (smart cards/EMV) revenue fell 4% to $257M, automotive rose 8% to $310M, and standard products (power management and logic ICs) rose 2% to $322M.
    • Q2 results/Q3 guidance, PR
    | Thu, Jul. 30, 1:40 PM | 3 Comments
  • Thu, Jul. 23, 4:18 PM
    • Freescale Semiconductor (NYSE:FSL): Q2 EPS of $0.57 beats by $0.07.
    • Revenue of $1.2B (+2.6% Y/Y) beats by $20M.
    • Press Release
    | Thu, Jul. 23, 4:18 PM | Comment!
  • Wed, Jul. 22, 5:35 PM
  • Wed, Jul. 22, 11:11 AM
    • The Philadelphia Semi Index (SOXX -3.2%) has fallen to its lowest levels since February after Apple, ARM, and Linear Technology posted their calendar Q2 reports yesterday afternoon.
    • Apple (down 4.8%) beat estimates, but offered soft guidance and reported slightly below-consensus iPhone sales. ARM (down 3.8%) reported roughly in-line Q2 results and a 26% Y/Y increase in ARM-based chip shipments, while stating it expects 2015 results to be in-line with expectations.
    • Linear (down 7.8%) missed FQ4 estimates and provided weak FQ1 guidance. Notably, the analog/mixed-signal chipmaker added it saw bookings slow "considerably" towards the end of Q2, with industrial and PC demand particularly weak. Bookings have improved in July, but Linear is still "preparing for a difficult [Q3]." The company expresses optimism the downturn will be short.
    • Apple suppliers are seeing big losses (previous). As are Linear peers Texas Instruments (TXN -3.7%), ON Semi (ON -5.1%), Maxim (MXIM -3.5%), IDT (IDTI -6.5%, Apple Watch supplier), InPhi (IPHI -4%), Exar (EXAR -4.2%), and Analog Devices (downgraded by Drexel Hamilton).
    • Other decliners include Micron (MU -4.2%, also an Apple supplier), Synaptics (SYNA -6.4%, ditto), STMicroelectronics (STM -6.2%, downgraded by Citi), Freescale (FSL -4.8%, following merger partner/Apple supplier NXP lower), Microchip (MCHP -4.6%), Cypress (CY -4.3%), Lattice (LSCC -3.9%), and Silicon Motion (SIMO -4.4%).
    • Qualcomm, TI, Cirrus Logic, SanDisk, and Xilinx report this afternoon.
    | Wed, Jul. 22, 11:11 AM | 3 Comments
  • Wed, Jul. 8, 11:37 AM
    • Chip stocks are underperforming as the Nasdaq registers a 1.2% decline. The Philadelphia Semi Index (SOXX -2.6%) is now down 13% from a June 1 peak of $101.80, and 4% YTD; it's still up 87% from a Nov. 2012 low of $47.58.
    • Plunging Chinese equity markets could be weighing on the group. With retail Chinese investors having set up brokerage accounts en masse over the last year, there are plenty of concerns about the reverse wealth effect of a crash. The Economist reccently downplayed those worries, noting a relatively modest 15% of Chinese household assets are invested in stocks.
    • Major decliners among chip developers include Skyworks (SWKS -4.9%), Qorvo (QRVO -5.6%), InvenSense (INVN -5.6%), NXP (NXPI -4.7%), Freescale (FSL -4%), MoSys (MOSY -9.4%), AppliedMicro (AMCC -5.1%), Cavium (CAVM -3.8%), and Silicon Motion (SIMO -6.4%). SIMO also fell yesterday after favorably adjusting its Q2 sales guidance. Skyworks and Qorvo sold off yesterday morning before rebounding in afternoon trading.
    • Other names tied to the industry that are seeing heavy selling pressure include ARM (ARMH -4%), TowerJazz (TSEM -5.1%), UMC (UMC -4.4%), Veeco (VECO -4.3%), and Axcelis (ACLS -4.6%).
    | Wed, Jul. 8, 11:37 AM | 6 Comments
  • Thu, Jul. 2, 2:05 PM
    • As expected, NXP (NXPI -0.1%) and Freescale (FSL +0.2%) shareholders have signed off on the companies' cash/stock merger. In addition, NXP has added Glen Capital Partners' Greg Summe and Permira Advisers partner Peter Smitham to the board, effective as of the merger's closing.
    • NXP/Freescale still expect the deal to close in 2H15. As previously announced, Freescale shareholders will receive $6.25 in cash and 0.35 NXP shares for each share they own - at current levels, that spells a payout of $40.58/share.
    • In May, NXP reached a $1.8B deal to sell its RF Power unit to China's JAC Capital, thus appeasing regulators worried about NXP/Freescale's combined base station power amplifier share.
    | Thu, Jul. 2, 2:05 PM | Comment!
  • Tue, Jun. 2, 9:23 AM
    • NXP (NASDAQ:NXPI) is offering $500M worth of senior notes due 2020, and $500M worth of senior notes due 2022.
    • Net proceeds are expected to help pay for the $2B cash portion of the Freescale (NYSE:FSL) acquisition, as well as refinance Freescale's debt and pay down its credit facility borrowings.
    • NXP ended Q1 with $1.4B in cash, and $4B in debt. Freescale had $501M in cash, and $5.3B in debt. NXP recently struck a $1.8B deal to sell its RF power amplifier unit that (in addition to keeping regulators happy) will help pay for the Freescale deal.
    | Tue, Jun. 2, 9:23 AM | 8 Comments
  • Thu, May 28, 6:18 PM
    • Continuing a string of chip asset purchases by Chinese firms, Beijing's JAC Capital is buying NXP's (NASDAQ:NXPI) RF Power unit (makes base station power amplifiers) for $1.8B in cash. The deal is expected to close in 2H15.
    • NXP will use the proceeds to help pay for the $2B cash portion of its pending acquisition of Freescale (NYSE:FSL). With Freescale also a major player in the base station amplifier market, NXP had previously announced it would sell its RF unit to keep regulators happy.
    • Pac Crest (Overweight) notes JAC is paying ~4x sales (in-line with peer valuations), and that the deal price is towards the high end of the $1B-$2B range estimated by the firm. It sees a $0.40 dilutive impact to 2016 EPS. Bernstein (Outperform) was only expecting a sale to reap $500M-$1B.
    • NXP and Freescale both closed up fractionally today following the announcement. They rallied yesterday with the help of Broadcom/Avago merger reports (confirmed this morning).
    | Thu, May 28, 6:18 PM | Comment!
  • Fri, May 1, 12:34 PM
    • After giving back most of yesterday's initial post-earnings gains amid a market selloff, NXP (NXPI +4.3%) is up sharply today as upbeat sell-side reactions arrive. Merger partner Freescale (FSL +3.7%) is naturally following NXP higher.
    • Needham's Rajvindra Gill observes that while NXP offered soft Q2 guidance (as many expected), it guided on its CC (transcript) for full-year revenue of $6.2B-$6.3B, roughly in-line with consensus and good for 11% Y/Y growth at the midpoint. He adds Q1 gross margin of 48.5% was above a 47.8% consensus, and that Q2 GM guidance of 48.5% was 40 bps above consensus.
    • Gill, who launched coverage on NXP with a Strong Buy rating and $140 target in March, still sees NXP/Freescale delivering $9+ in 2017 EPS, and asserts the post-merger company will be "a powerhouse in autos, microcontrollers (MCUs), and the Internet-of-Things (IoT)."
    • Separately, an ABI Research teardown of the Apple Watch's S1 chip module turned up (as expected) an NXP NFC controller IC, as well as a second NXP chip (motion co-processor?). AMS provides a complementary NFC signal booster chip.
    | Fri, May 1, 12:34 PM | Comment!
  • Thu, Apr. 30, 9:40 AM
    • In addition to slightly missing Q1 revenue estimates (while beating on EPS), NXP (NASDAQ:NXPI) is guiding for Q2 revenue of $1.485B-$1.535B and EPS of $1.33-$1.43, mostly below a consensus of $1.54B and $1.41. However, a soft outlook was expected after many peers provided one last week.
    • With Apple NFC chip and M8 motion co-processor demand still providing a boost, high-performance mixed-signal chip sales (75% of total revenue) rose 21% Y/Y in Q1 to $1.1B. Standard products (analog/power management chips) rose 9% to $323M.
    • Boosting Q1 EPS, gross margin (non-GAAP) was 48.5%, +190 bps Q/Q and -100 bps Y/Y, and slightly above guidance of 48%; Q2 GM guidance is at 48.5%. Also: GAAP operating expenses only rose 2% Y/Y to $409M; R&D spend rose by $10M to $199M, but SG&A fell by $3M to $210M.
    • Merger partner Freescale (NYSE:FSL) is following NXP higher. Freescale posted a Q1 beat and soft guidance last week.
    • Q1 results, PR
    | Thu, Apr. 30, 9:40 AM | Comment!
  • Fri, Apr. 24, 2:03 PM
    • Though the Nasdaq is up 0.7% thanks to market-pleasing earnings from Google, Microsoft, and Amazon, chip stocks (SOXX -2.1%) are adding to their Thursday losses after Freescale, Altera, Microsemi, and Maxim joined the ranks of chipmakers offering soft Q2 guidance; Texas Instruments, Xilinx, and Qualcomm did so on Wednesday afternoon.
    • NXP (NXPI -4.3%), set to merge with Freescale in a cash/stock deal, is selling off ahead of its April 29 Q1 report. RF chipmakers Skyworks (SWKS -3.8%), Qorvo (QRVO -4.4%), and Avago (AVGO -5.2%) are also seeing steep declines.
    • Other decliners include a slew of telecom/networking, microcontroller, and analog/mixed-signal chipmakers. The group includes Marvell (MRVL -3%), ON Semi (ON -6.9%), Atmel (ATML -3.3%), Cypress (CY -4%), Lattice (LSCC -3.9%), Semtech (SMTC -6.9%), Cavium (CAVM -6%), PMC-Sierra (PMCS -2.9%), InPhi (IPHI -3.8%), and Silicon Labs (SLAB -2.9%). Chip packaging/testing firm Amkor (AMKR -5.7%) is also off; its Q1 report arrives on Monday.
    • As was the case with TI and Xilinx, soft telecom equipment chip demand was often blamed by those guiding light yesterday afternoon. Freescale (FSL -3.5%) stated it expects network processor division sales to be down Q/Q and RF (base station power amplifier) division sales to be flat. Microcontroller, automotive, and analog and sensor division sales are expected to rise.
    • Altera (ALTR -3.3%) stated its "telecom and wireless business, and particularly our wireless business globally looks to be quite weak in [Q2], while the rest for our business will in aggregate be flat to slightly up." Regarding its Q1 miss, the company notes "Industrial, test, compute and storage, and to a lesser extent military, fell short of our forecast" (share loss to Xilinx?).
    • Maxim reports seeing "broad-based softness in communications infrastructure demand" and soft industrial bookings to go with healthier mobile/auto demand. The Galaxy S6 appears to be giving a lift to Maxim's mobile sales.
    | Fri, Apr. 24, 2:03 PM | 1 Comment
  • Thu, Apr. 23, 6:25 PM
    • Though it beat Q1 estimates, Freescale (NYSE:FSL) has guided for Q2 revenue of $1.155B-$1.205B, below a $1.22B consensus.
    • No explanation is given for the outlook in the earnings release. Texas Instruments and Xilinx have both observed seeing soft demand from the mobile infrastructure market, which Freescale is well-exposed to. Freescale's RF sales (inc. mobile power amplifiers) rose 63% Y/Y in Q1 to $184M.
    • Shares have fallen to $38.99 AH; they were down 3.7% in regular trading thanks to TI/Xilinx's numbers. NXP, which is set to buy Freescale in a cash/stock deal, is nearly unchanged for now.
    • Q1 results, PR
    | Thu, Apr. 23, 6:25 PM | 1 Comment
  • Thu, Apr. 23, 4:07 PM
    • Freescale Semiconductor (NYSE:FSL): Q1 EPS of $0.48 beats by $0.04.
    • Revenue of $1.17B (+3.5% Y/Y) beats by $10M.
    • Press Release
    | Thu, Apr. 23, 4:07 PM | Comment!
FSL vs. ETF Alternatives
Company Description
Freescale Semiconductor Ltd offers embedded processors such as microcontrollers and digital networking processors.