Standard Products - NXP Semiconductors

NXP: Innovations and Customer Momentum Loh Kin Wah, Executive Vice President, Sales and Marketing April 3, 2012

Welcome! And a little more about me… – Executive Vice President, Sales and Marketing since October 1, 2011 – Based in Singapore – Over 30 years experience in the Semiconductor Industry • President and CEO, Qimonda AG • Head of Communications Business Group, Infineon Technologies AG • Head of Memories Product Group, Infineon Technologies AG

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NXP Semiconductors NXP Semiconductors N.V. (NASDAQ: NXPI) provides High Performance Mixed Signal and Standard Product solutions that leverage its leading RF, Analog, Power Management, Interface, Security and Digital Processing expertise. A global semiconductor company with operations in more than 25 countries, NXP posted revenue of $4.2 billion in 2011. Our innovations are used in a wide range of automotive, identification, wireless infrastructure, lighting, industrial, mobile, consumer and computing applications.

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Financial track record Revenue (millions of USD) High Performance Mixed Signal

45.9%

48.2% 48.9%

52.6%

56.5% 57.6% 57.0% 55.6% 56.5%

Standard Products

35.7%

52.4%

40.3%

18.9%

21.5%

24.0%

27.1%

38.5% 36.7% 37.8% 36.9% 36.4%

30.9%

28.7%

373

454

547

637

695

719

715

717

742

779

726

659 163 94 -16.0%

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 HPMS Revenue ($M)

non-GAAP Gross Margin

183

199

207

221

221

237

246

244 198

127

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Std. Prod. Revenue ($M)

non-GAAP Gross Margin

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NXP in North America • Over 520 employees • • • • •

Americas sales and marketing BL-Microcontrollers BL-Logic BL-Interface BL-HPRF

• Major locations: • • • • • •

San Jose, CA Tempe, AZ San Diego, CA Farmington Hills, MI Boston, MA Cary, NC

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Constant sales in North America

Revenue by geography

• Constant business levels maintained in the US, despite move to off-shore manufacturing. • US is still critical for leading and innovative design ins 6

Semiconductor industry is driven by societal trends Energy • Efficient power conversion & management • CFL and LED lighting and back-lighting solutions • Energy conservation: e-metering, smart appliances

Mobility • Intelligent traffic management • Car safety, security and remote diagnostics features • Green cars: electrical vehicles, car networks

Health • Smart and small hearing aids and headsets • Personal health devices and portable medical imaging • Biosensors

Security • Secure mobile transactions and secure identity • Goods tagging, authentication and tracking • Security and privacy protection

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Automotive Highlights

Key Positions #1 Passive Keyless Entry & Immobilizers (48% MS) # 1 In-Vehicle Networking: CAN/LIN/Flexray (46% MS) # 1 Car Radio (32% MS)

Emerging Growth Engines Auto LED Software defined digital radio Telematics

 Secular market trends and characteristics  Focus on reduced CO2 ,mobility and convenience  High barriers to entry and long product life-cycles  Auto electronics market to grow above market  High growth in BRIC countries  Market leader for > 80% of automotive revenue  #3 in China, #5 world-wide  Focus on high margin segments  Recent innovations to drive growth  First multi-standard digital software-defined radio  First single-chip digital radio for terrestrial radio  First with new “Flexray” in-car networking standard

Aligned with Market Leaders

Sources: Market share data based on results for 2009 Strategy Analytics (market size, market shares PKE/Immo and IVN), iSuppli (China/WW ranking, market share car radio)

Note: All figures throughout this presentation reflect results from continuing operations, net of the divesture of the Sound Solutions business.

Identification Highlights

Key Positions # 1 eGov (37% MS)

#1 Transport & Access (70%+ MS)

#1 NFC (~85% MS)

# 1 RFID (40%+ MS) Readers (Leader)

Emerging Growth Engines Authentication


 Secular market trends and solutions  Electronic Mobile Payments SmartMXTM  Security & Trusted Access  Smart@IDTM  Secure Connected Mobility  MIFARETM  Counterfeit prevention  Market leader and innovator in identification market  Co-inventor of NFC with broad IP patent portfolio  Leader in field proven contactless interoperability  Proven vendor with complete NFC solution  Strategic collaboration with Google  Recent innovations to drive growth  NXP is driving broad-based NFC ecosystem adoption  Authentication / Product tagging for inventory control  New opportunities: e-metering, car control, telematics…

The Connectivity Revolution

>1B contactless touch points

Sources: Market share data based on results for 2009 IMS, Idtechex and ABI

Note: All figures throughout this presentation reflect results from continuing operations, net of the divesture of the Sound Solutions business.

Wireless Infrastructure, Lighting and Industrial Highlights

Key Positions Lighting Driver ICs: #1 HID (40% MS) #1 Multimarket 32-bit ARM MCU (25-30% MS) #2 High Performance RF (15% MS)

Emerging Growth Engines ADC HS Data converter

802.15

CFL


LED

 Secular market trends  Increased demand for energy efficient lighting  Emerging market for centralized smart grid control  Mobile data usage driving cellular base-station  Market leader  Innovator in ultra-low power intelligent networked environmental control  Lighting control (CFL and LED)  LP Wireless access (IEEE 802.15)  System knowledge and firmware  Multi-market 32-bit ARM MCU leader  Recent innovations to drive growth  Intelligent networked lighting  Smart home connectivity


10 Note: All figures throughout this presentation reflect results from continuing operations, net of the divesture of the Sound Solutions

Mobile, Consumer and Computing Highlights

Key Positions Notebook AC/DC (~45% MS)

#1 I²C

Interface ICs: #1 LP RTC #2 Bridge ICs & UARTS #1 STV/STB Silicon Tuners

Emerging Growth Engines LED controllers

Low power adapter

DisplayPort

 Secular market trends  Increased demand for energy efficiency  Low power mixed-signal integration  Transition to Si tuners in DTV/STB  Market leader  Innovator of GreenChip notebook power supply  Leader in silicon tuners for STV/STB  Multi-market interface and general purpose logic  Recent innovations to drive growth  GreenChip for low power adapters  High-speed interface product portfolio  Personal Health portfolio



11 Note: All figures throughout this presentation reflect results from continuing operations, net of the divesture of the Sound Solutions business.

Standard Products NXP’s Standard Products portfolio provides solutions for energy efficiency and system protection leveraging expertise in component integration and packaging Commitment to quality – product failure rate measured in parts per billion (ppb) Approximately 45% of all Standard Products are “designed-in”

Design-in margin profile better than SP average, with lower annual ASP erosion Benefits of Standard Products to HPMS segment Strong distribution footprint: #2 supplier worldwide, providing broad customer reach Vast in-house manufacturing output (>70B units/yr) results in packaging innovation and scale

Discretes

Standard Linear

PowerMOS

Bipolar Power

LFPak, the toughest PowerSO8

#2 worldwide in small signal diodes & transistors, #1 in pure ESD Protection devices

Voltage regulators for the mobile, computing & consumer markets

Low voltage power MOSFETs for automotive & high speed switching applications

China-based manufacturer of rectifiers & thyristors

Sources:#2 WW distribution based on Lively Report, #2 Small Signal from WSTS market size, #1 in Pure ESD from IMS Research Apr-2011

Uniquely Positioned to Win in HPMS 6,800 HPMS products: HP RF, Analog, Power, Interface, MCU, DSP, Logic, Security, Sensors, ADC/DAC

Broad Product Portfolio Across System Functions

Leading Mixed-Signal and Digital Design Skills

>2,600 experienced HPMS engineers

Leading Patent Portfolio >37,000 (WW) 11,000 (WW)

Deep IP Portfolio

>3,100 (US) 3,126 (US) 2,103 (US) ~900 (US)

• 8 priority applications

Deep Applications Expertise

• Hired >100 Field Application Engineers in 2009 • Bringing innovations to our customer base

Specialty Processes & Competitive Manufacturing Assets

• World class RF, HV power and Auto processes • Scale back-end producing 60 billion parts per year • Largely Asian manufacturing

Source: Patent data from annual filings and company web-sites

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Leading innovations from NXP! Home and Building Automation – Energy efficient smart lighting solution

Near Field Communications and RFID – Customization with RFID technology – NFC-enabled gaming experience

Connected Mobility: eBike – ATOP; Concept Radio; SSL; NFC and eMetering

Angry Birds Slingshot using Cortex M0 NXP’s Mobile Apps: bringing product information to your mobile devices

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Thanks….and any questions?

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