NXP said it was the fifth-largest non-memory semiconductor supplier in 2016, and the leading semiconductor supplier for the secure identification, automotive and digital networking industries. The company was founded in 1953 as part of the electronics firm Philips, with manufacturing and development in Nijmegen, Netherlands. Known then as Philips Semiconductors, the company was sold to a consortium of private equity investors in 2006, at which point the company's name was changed to NXP.
On August 6, 2010, NXP completed its Initial public offering, with shares trading on NASDAQ under the ticker symbol NXPI. On December 23, 2013, NXP Semiconductors was added to the NASDAQ 100. Finally, on March 2, 2015, it was announced that NXP Semiconductors would merge with chip designer and manufacturer Freescale Semiconductor in a $40 billion US-dollar deal. The merger was closed on December 7, 2015.
NXP Semiconductors provides mixed signal and standard products based on its security, identification, automotive, networking, radio frequency, analog signal, and power management expertise. With an emphasis on security of the connected vehicle and the Internet of things, the company's products are used in automotive, identification, wired and wireless infrastructure, lighting, industrial, consumer, mobile and computing applications. For example, in order to protect against potential hackers, NXP offers gateways to automotive manufacturers that prevent communication with every network within a car independently.
NXP is the co-inventor of near field communication (NFC) technology along with Sony and supplies NFC chip sets that enable mobile phones to be used to pay for goods, and store and exchange data securely. NXP manufactures chips for eGovernment applications such as electronic passports; RFID tags and labels; and transport and access management, with the chip set and contactless card for MIFARE used by many major public transit systems worldwide.
In addition, NXP manufactures automotive chips for in-vehicle networking, passive keyless entry and immobilization, and car radios. NXP invented the I²C interface over 30 years ago and supplier of products using it. NXP is also a volume supplier of standard logic devices, and celebrated its 50 years in logic (via its history as both Signetics and Philips Semiconductors) in March 2012.
NXP owns over 9,000 issued or pending patents.
Silicon Valley-based Signetics, the "first company in the world established expressly to make and sell integrated circuits" and inventor of the 555 timer IC, was acquired by Philips in 1975. At the time, it was claimed that "with the Signetics acquisition, Philips was now number two in the league table of semiconductor manufacturers in the world." In 1987, Philips-Signetics, a unit of Philips, was ranked Europe's largest semiconductor maker, with sales of $1.36 billion in 1986.
Philips acquired VLSI Technology in June 1999. At the time, the acquisition made Philips the world's sixth largest semiconductor company.
In December 2005, Philips announced its intention to legally separate its semiconductor division, Philips Semiconductors, into an independent legal entity.
The new company name NXP (from Next eXPerience) was announced on August 31, 2006, and was officially launched during the Internationale Funkausstellung (IFA) consumer electronics show in Berlin. The newly independent NXP was ranked as one of the world's top 10 semiconductor companies. At the time, CEO Frans van Houten emphasized the importance of NXP in enabling "vibrant media" technologies in mobile phones, digital TVs, portable music players and other consumer electronics devices.
NXP's first acquisition as an independent company was in 2007, when NXP announced that it would acquire Silicon Laboratories’ AeroFONE single-chip phone and power amplifier product lines to strengthen its Mobile and Personal business. Fourteen months later, NXP announced that it would transform its Mobile and Personal business unit into a joint venture with STMicroelectronics, which in 2009 became ST-Ericsson, a 50/50 joint venture of Ericsson Mobile Platforms and STMicroelectronics, after ST purchased NXP's 20% stake.
Similarly, in April 2008, NXP announced it would acquire the set-top box business of Conexant to complement its existing Home business unit. In October 2009, NXP announced that it would sell its Home business unit to Trident Microsystems.
In September 2008, NXP announced that it would restructure its manufacturing, R&D and back office operations, resulting in 4,500 job cuts worldwide, for annual savings of $550 million.
Current president and CEO Rick Clemmer took over from Frans van Houten on January 1, 2009. Clemmer has emphasized the importance of "high performance mixed signal" products as a key focus area for NXP. As of 2011, "standard products" including components such as small signal, power and integrated discretes accounted for 30 percent of NXP's business.
On July 26, 2010, NXP announced that it had acquired Jennic based in Sheffield, UK, which now operates as part of its smart home and energy product line, using ZigBee and JenNet-IP.
In 2012, revenue for NXP's Identification business unit was $986 million, up 41% from 2011, in part due to growing sales of NFC chips and secure elements.
On January 4, 2013, NXP and Cisco announced their investment in Cohda Wireless, an Australian company focused on car-to-car and car-to-infrastructure communications.
In January 2013, NXP announced 700-900 redundancies worldwide in an effort to cut costs related to "support services".
In May 2013, NXP announced that it acquired Code Red Technologies, a provider of embedded software development such as the LPCXpresso IDE and Red Suite.
In July 2014, NXP was reported to have sacked union organisers. A campaign was started for their reinstatement.
On June 14, 2016, it was announced that Nexperia would be divested from NXP to a consortium of financial investors consisting of Beijing Jianguang Asset Management Co., Ltd (“JAC Capital”) and Wise Road Capital LTD (“Wise Road Capital”). This transaction is expected to close in the first quarter of 2017 pending all required regulatory approvals and employee representative consultations.
Both have deep roots stretching back to when they were part of Philips NV (in the case of NXP), and Motorola (Freescale). Each has comparable revenue figures; US$4.8B and US$4.2B for NXP and Freescale respectively in 2013. NXP primarily focuses on near field communication (NFC) and high-performance mixed signal (HPMS) hardware. Freescale focuses on its microprocessor and microcontroller. Both companies possess roughly equal patent portfolios.
Certainly, each company brings core strengths to the combined organization, NFC from NXP and microcontrollers from Freescale. Also, both companies have been actively involved in litigation over the years as both plaintiff and defendant, so a larger and, more importantly, a more geographically diverse patent portfolio could likely prove useful in such matters. Chipworks' analysts suggest the newly merged company will divest itself of many properties as the merger progresses.
Some analysts believe cost savings after the two companies merge are expected to be about $500M dollars. Customers are ultimately divided over the consolidation of their product families and how it may affect their own development and end-products.