NXP Semiconductors Announces Second Quarter 2007 Results

July 24, 2007

NXP Semiconductors Announces Second Quarter 2007 Results

Highlights

Second quarter sales at EUR 1,141 million vs EUR 1,115 million in the first quarter
Currency comparable sequential sales growth of 4.1% (nominal growth 2.3%), comparable year on year decrease of 4.8%
Second quarter adjusted EBITA, excluding effects of Purchase Price Accounting, at EUR 7 million
Cash position of EUR 514 million at end of second quarter
Business Renewal II Programme on track and expected to exceed EUR 250 million of cost savings by the end of 2008
Book to bill ratio of 1.02 in second quarter
Factory loading at 74% in second quarter up from 69% in the first quarter

NXP Semiconductors today announced its second quarter 2007 results. Sales for the quarter amounted to EUR 1,141 million, a 4.1% currency comparable growth over the first quarter of 2007 (nominal 2.3%) and a 4.8% decline over the second quarter of 2006. Excluding the impact of Purchase Price Accounting, adjusted EBITA was EUR 7 million compared to EUR 64 million in the second quarter of 2006 and 3 million in the first quarter of 2007.

Frans van Houten, President and CEO of NXP Semiconductors, commented: “Although sales increased in line with our forecast, we still see continuing softness of the overall marketplace. We are making good progress in addressing the underlying issues in our largest Business Unit, Mobile & Personal, where a combination of new management, the successful integration of the recently acquired Silicon Labs Wireless operations, and a focussing of the product portfolio have been well received by our customers. We are addressing the performance of the Home Business Unit through several measures, while our Automotive & Identification Business Unit continues to maintain leadership positions. Sales in the MultiMarket Semiconductors Business Unit outpaced the market.”

“Our Business Renewal II Programme is expected to exceed the EUR 250 million of cost savings achieved in the first phase of Business Renewal. EUR 100 million of these savings are expected to be realised on a run rate basis by the end of 2007, following the acceleration of actions in the first half of this year. In addition, we continued to actively manage our portfolio, notably with the combination of our Cordless and VoIP Terminals operations with the DSP Group, which we expect to close in the third quarter.”

Cash at the end of the second quarter amounted to EUR 514 million after the final settlement payment to Philips of EUR 85 million.

Outlook: The market remains soft. Given our book-to-bill ratio of 1.02 in the second quarter, we expect low to mid single digit sequential sales growth for the third quarter 2007 on a currency comparable basis. We believe we are well positioned to benefit from the next upturn in the relevant semiconductor market segments.

The full report is available on NXP website (www.nxp.com/investor).

About NXP Semiconductors

NXP is a top semiconductor company founded by Philips more than 50 years ago. Headquartered in Europe, the company has 37,000 employees working in more than 20 countries and posted sales of EUR 5 billion in 2006. NXP creates semiconductors, system solutions and software that deliver better sensory experiences in mobile phones, personal media players, TVs, set-top boxes, identification applications, cars and a wide range of other electronic devices. News from NXP is located at http://www.nxp.com/.