NXP Celebrates First Year as Independent Company; Sets Path for Growth in China

NXP Semiconductors has marked a celebration in China after nearly twelve months operating as an independent company, following its spin-off from Philips.

NXP President and CEO, Frans van Houten, and his Executive Management Team (EMT) are visiting China to meet with government officials, customers and employees. The Team, in addition to celebrating its first year of operation as an independent company, will also present the outcomes of a strategic review of the company's product portfolio in its biggest single market; the next phase of the company's ongoing Business Renewal program.

Globally, NXP has recently overhauled its overall product strategy as part of its Business Renewal Program. The strategic "Roadmapping for Leadership" project will have a major effect on NXP's R&D focus and spending. The company will step-up investments in twenty seven business segments, maintain current spending level in 18 segments, and right-size spending on a more focused road map in six segments. In total R&D spending will stay around €1 billion per year with investment driven toward the most promising businesses and road maps. The objective of this program is to foster growth and market share gain in the company's key markets, i.e. the six growth domains where it focuses: cellular phones, personal entertainment, home electronics, automotive, identification and multi market semiconductors.

"We are making good progress on our journey to become an agile, more cost efficient, high performing company with our eyes directed towards the market place. Already we have leadership positions with approximately 50 percent of our product lines. The decisions that we have recently taken will help us build more leadership positions in the six growth domains where we are focused," van Houten said.

The focus on product portfolio has already seen NXP acquire the cellular operations of Silicon Labs, purchase Sharp's BlueStreak ARM based microcontroller business and merge its Cordless & Voice over IP Terminals businesses with the DSP Group.

"Since the spin-off from Philips in September 2006, we are proud of our achievements in our first year of operation as an independent company. We continue to see positive growth momentum and strong support from our stakeholders," added van Houten. "As a standalone company, we have refocused our R&D strategy for Advanced CMOS, made progress on our asset light strategy and completed our first acquisitions."

As one of the objectives of the EMT China visit, the Team will also review its China operations; NXP's single largest market worldwide. It is NXP's stated objective to further grow its business and presence in China. As part of the China strategy, NXP is investing strongly in the China's 3G mobile phone standards, TDSCDMA and TD-HSDPA, together with its JV T3G in Beijing. Other investment areas in China include the world's largest discrete manufacturing operation in Donguan where NXP has invested more than $172 million, as well as the joint venture with ASE in Suzhou. NXP is also strengthening its R&D presence in Shanghai where ULC mobile phone chips and Digital Television chips are developed, specifically for the Chinese market.

NXP Semiconductors