Nexperia Sees Drop in 2023 Following Newport Sale

Nexperia, a leading semiconductor manufacturer, experienced a 13% increase in research and development (R&D) investment in 2023, despite facing an 8% decline in turnover and various challenges stemming from its Chinese ownership.

The company's total revenue for the year amounted to US$2.15 billion, marking an 8% decrease from the previous year's figure of $2.36 billion. This decline was primarily attributed to weak market demand. Notably, revenue in the automotive sector, which has traditionally been a strong segment for Nexperia, showed significant growth. However, due to the company's ownership by Chinese holding firm WingTech, specific revenue details for the automotive division were not disclosed.

In addition to financial fluctuations, Nexperia encountered a significant development in 2023 when it was compelled to divest its ownership stake in Newport Wafer Fab, a facility it had acquired in Wales. The UK government raised national security concerns, prompting the sale. Reports indicated that the foundry was sold to Vishay's Siliconix subsidiary for $117 million, following Nexperia's purchase of it for $87 million in 2021.

Throughout 2023, Nexperia emphasized its commitment to innovation and expansion, investing substantially in upgrading and diversifying its product portfolio. The company allocated 13% of its revenue, equivalent to $280 million, towards enhancing its offerings in discrete power devices, modules, analog, and power integrated circuits (ICs). Nexperia operates power fabs in Hazel Grove, Manchester, and Hamburg, Germany, and has been focusing on enhancing product integration, exemplified by the establishment of its first analog design center in Dallas in 2022.

Looking forward to 2024, Nexperia remains cautiously optimistic despite prevailing uncertainties in European and North American markets. The company anticipates a rise in demand levels in Asia and is committed to delivering value to its stakeholders amidst market fluctuations. Stefan Tilger, the Chief Financial Officer of Nexperia, expressed confidence in the company's resilience and dedication to sustainable growth.

In a strategic move towards environmental sustainability, Nexperia secured an $800 million Senior Sustainability-Linked Loan (SLL) to support its goal of achieving carbon neutrality by 2035, particularly focusing on reducing scope 1 and 2 emissions. Wing Zhang, CEO of Nexperia and WingTech, commended the company's perseverance in overcoming challenges and reiterated its unwavering commitment to investment and innovation, setting a solid foundation for a promising future.