GlobeNewswire Inc | Feb 1, 2021 04:01PM EST

February 01, 2021

EINDHOVEN, The Netherlands, Feb. 01, 2021 (GLOBE NEWSWIRE) -- NXP Semiconductors N.V. (NASDAQ: NXPI) today reported financial results for the fourth quarter and full year ended December 31, 2020.

NXP delivered full-year revenue of $8.6 billion, with 2020 being best characterized as two halves with completely different business trends. During the first half of the year, NXP was faced with the unprecedented shut down of our customers in most end markets and geographies because of the global pandemic. As we entered the second half of 2020, and our customers began to re-open, NXP experienced a very robust rebound in demand, which we anticipate continuing throughout 2021. In the fourth quarter, revenue was $2.5 billion, an increase of 9 percent year-on-year, and near the upper end of our guidance range. During this time, we experienced especially strong trends in the Automotive and Mobile end-markets, said Kurt Sievers, NXP President and Chief Executive Officer.

Notwithstanding a tumultuous 2020, revenue associated with key strategic growth areas accelerated throughout the year. We continued to maintain focused investments in critical R&D programs, which will assure the companys long-term success, while simultaneously controlling non-essential, discretionary expenses, resulting in solid operating profitability and strong cash flow. Throughout the year, our number one priority was to assure the safety and health of all our employees. We are extremely proud of their adaptability, dedication and hard work in the face of adversity, said Sievers.

Key Highlights

-- Fourth-quarter revenue was $2.5 billion, up 9.0 percent year-on-year; -- Fourth-quarter GAAP gross margin was 51.4 percent, and GAAP operating margin was 18.5 percent; -- Fourth-quarter non-GAAP gross margin was 52.9 percent, and non-GAAP operating margin was 30.5 percent; -- Full-year cash flow from operations was $2,482 million, with net capex investments of $388 million, resulting in non-GAAP free cash flow of $2,094 million; -- On November 19, 2020, the NXP Board of Directors approved the payment of an interim dividend for the fourth quarter 2020 of $0.375 per ordinary share; -- In 2020, NXP returned $1,047 million to shareholders, through previously announced share repurchases and dividend payments; -- On September 28, 2020, subsequent to the close of NXP's third quarter, the company fully redeemed the $1.35 billion of outstanding principal of the 4.125% Senior Notes due 2021 and the $400 million of outstanding principal of the 4.625% Senior Notes due 2022. The total amount of these redemptions, $1.83 billion, were paid from available cash on balance sheet.

Summary of Reported Fourth Quarter and Full-year 2020 ($ millions, unaudited) (1)

Q4 2020 Q3 2020 Q4 2019 Q - Q Y - 2020 2019 Y-Y YTotal $ 2,507 $ 2,267 $ 2,301 11% 9% $ 8,612 $ 8,877 -3%RevenueGAAP Gross $ 1,288 $ 1,090 $ 1,209 18% 7% $ 4,235 $ 4,618 -8%ProfitGrossProfit $ (38 ) $ (45 ) $ (39 ) $ (165 ) $ (131 ) Adjustments^(i)Non-GAAPGross $ 1,326 $ 1,135 $ 1,248 17% 6% $ 4,400 $ 4,749 -7%ProfitGAAP Gross 51.4 % 48.1 % 52.5 % 49.2 % 52.0 % MarginNon-GAAPGross 52.9 % 50.1 % 54.2 % 51.1 % 53.5 % MarginGAAPOperating $ 463 $ 32 $ 197 1,347% 135% $ 418 $ 641 -35%Income /(Loss)OperatingIncome $ (301 ) $ (554 ) $ (490 ) $ (1,810 ) $ (1,932 ) Adjustments^(i)Non-GAAPOperating $ 764 $ 586 $ 687 30% 11% $ 2,228 $ 2,573 -13%IncomeGAAPOperating 18.5 % 1.4 % 8.6 % 4.9 % 7.2 % MarginNon-GAAPOperating 30.5 % 25.8 % 29.9 % 25.9 % 29.0 % Margin

Additional informationAutomotive $ 1,193 $ 964 $ 1,097 24% 9% $ 3,825 $ 4,212 -9%Industrial $ 511 $ 514 $ 415 -1% 23% $ 1,836 $ 1,599 15%& IoTMobile $ 409 $ 337 $ 332 21% 23% $ 1,248 $ 1,191 5%Comm.Infra. & $ 394 $ 452 $ 457 -13% -14% $ 1,703 $ 1,875 -9%OtherDIO 78 84 102 DPO 75 55 81 DSO 28 30 26 CashConversion 31 59 47 CycleChannelInventory 1.6 2.4 2.3 (months)FinancialLeverage ^ 1.9x 2.1x 2.0x (ii)

1. Additional Information for the Fourth Quarter and Full-year 2020: i. For an explanation of GAAP to non-GAAP adjustments, please see ?Non-GAAP Financial Measures?. ii. Financial leverage is defined as net debt divided by trailing twelve months adjusted EBITDA. During the fourth quarter of 2020, NXP repurchased 1.8 million shares for ? a total cost of $257 million and paid cash dividends of $105 million. Full year 2020, NXP repurchased 4.8 million shares for a total cost of $627 million, paid cash dividends of $420 million. Weighted average number of diluted shares for the three-month period ended ? December 31, 2020 was 285.3 million. Weighted average number of diluted shares for the twelve-month period ended December 31, 2020 was 283.8 million. Net cash paid for income taxes related to on-going operations was $30 million. Net cash paid for income taxes not related to on-going operations ? resulted in additional cash payments of $15 million. Full year 2020 net cash paid for income taxes related to on-going operations was $103 million, not related to on-going operations was $45 million. Peter Kelly, NXP?s Chief Financial Officer has notified the company of his ? intent to retire from NXP as of February 2022. The company will undertake a search for qualified candidates both internally and externally.

Guidance for the First Quarter 2021: ($ millions) (1)

Guidance Range GAAP Reconciliation non-GAAP Low Mid High Low Mid HighTotal Revenue $ 2,475 $ 2,550 $ 2,625 $ 2,475 $ 2,550 $ 2,625 Q-Q -1 % 2 % 5 % -1 % 2 % 5 %Y-Y 22 % 26 % 30 % 22 % 26 % 30 %Gross Profit $ 1,283 $ 1,331 $ 1,378 $ (34 ) $ 1,317 $ 1,365 $ 1,412 Gross Margin 51.8 % 52.2 % 52.5 % 53.2 % 53.5 % 53.8 %Operating Income $ 468 $ 506 $ 543 $ (269 ) $ 737 $ 775 $ 812 (loss)Operating Margin 18.9 % 19.8 % 20.7 % 29.8 % 30.4 % 30.9 %Financial Income $ (87 ) $ (87 ) $ (87 ) $ (2 ) $ (85 ) $ (85 ) $ (85 )(expense)

Note (1) Additional Information:

-- GAAP Gross Profit is expected to include Purchase Price Accounting (PPA) effects, $(16) million; Stock Based Compensation, $(12) million; Other Incidentals, $(6) million; -- GAAP Operating Income (loss) is expected to include PPA effects, $(162) million; Stock Based Compensation, $(88) million; Restructuring and Other Incidentals, $(19) million; -- GAAP Financial Income (expense) is expected to include Other financial expense $(2) million; -- Net cash paid for income taxes related to on-going operations is expected to be approximately $(56) million; -- Non-controlling interest is expected to be approximately $(10) million; -- Weighted average diluted share count is expected to be approximately 284 million.

NXP has based the guidance included in this release on judgments and estimates that management believes are reasonable given its assessment of historical trends and other information reasonably available as of the date of this release. Please note, the guidance included in this release consists of predictions only, and is subject to a wide range of known and unknown risks and uncertainties, many of which are beyond NXP's control. The guidance included in this release should not be regarded as representations by NXP that the estimated results will be achieved. Actual results may vary materially from the guidance we provide today. In relation to the use of non-GAAP financial information see the note regarding "Non-GAAP Financial Measures" below. For the factors, risks, and uncertainties to which judgments, estimates and forward-looking statements generally are subject see the note regarding "Forward-looking Statements." We undertake no obligation to publicly update or revise any forward-looking statements, including the guidance set forth herein, to reflect future events or circumstances.

Non-GAAP Financial Measures

In managing NXP's business on a consolidated basis, management develops an annual operating plan, which is approved by our Board of Directors, using non-GAAP financial measures. In measuring performance against this plan, management considers the actual or potential impacts on thesenon-GAAP financial measures from actions taken to reduce costs with the goal of increasing our gross margin and operating margin and when assessing appropriate levels of research and development efforts. In addition, management relies upon these non-GAAP financial measures when making decisions about product spending, administrative budgets, and other operating expenses. We believe that these non-GAAP financial measures, when coupled with the GAAP results and the reconciliations to corresponding GAAP financial measures, provide a more complete understanding of the Companys results of operations and the factors and trends affecting NXPs business. We believe that they enable investors to perform additional comparisons of our operating results, to assess our liquidity and capital position and to analyze financial performance excluding the effect of expenses unrelated to operations, certain non-cash expenses and share-based compensation expense, which may obscure trends in NXP's underlying performance. This information also enables investors to compare financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management.

These non-GAAP financial measures are provided in addition to, and not as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. The presentation of these and other similar items in NXPs non-GAAP financial results should not be interpreted as implying that these items are non-recurring, infrequent, or unusual. Reconciliations of these non-GAAP measures to the most comparable measures calculated in accordance with GAAP are provided in the financial statements portion of this release in a schedule entitled Financial Reconciliation of GAAP tonon-GAAP Results (unaudited). Please refer to the NXP Historic Financial Model file found on the Financial Information page of the Investor Relations section of our website at https://investors.nxp.com for additional information related to our rationale for using these non-GAAP financial measures, as well as the impact of these measures on the presentation of NXP's operations.

In addition to providing financial information on a basis consistent with U.S. generally accepted accounting principles (GAAP), NXP also provides the following selected financial measures on a non-GAAP basis: (i)Gross profit, (ii)Gross margin, (iii)Research and development, (iv)Selling, general and administrative, (v)Amortization of acquisition-related intangible assets, (vi) Other income, (vii)Operating income (loss), (viii)Operating margin, (ix)Financial Income (expense), (x)adjusted net income, adjusted EBITDA and trailing 12 month adjusted EBITDA, and (xi)free cash flow and free cash flow as a percent of Revenue. The non-GAAP information excludes the amortization of acquisition related intangible assets, the purchase accounting effect on inventory and property, plant and equipment, merger related costs (including integration costs), certain items related to divestitures,share-based compensation expense, restructuring and asset impairment charges, non-cash interest expense on convertible notes, extinguishment of debt, and foreign exchange gains and losses.

Conference Call and Webcast InformationThe company will host a conference call with the financial community on Tuesday, February 2, 2021 at 8:00 a.m. U.S. Eastern Standard Time (EST) to review the fourth quarter and full-year 2020 results in detail. Interested parties may join the scheduled conference call by dialing the following numbers:

Within the U.S.: 1 - 888 - 603 - 7644Outside the U.S.: 1 - 484 - 747 - 6631Participant Passcode: 6985554

The call will be webcast and can be accessed from the NXP Investor Relations website https://investors.nxp.com. A replay of the call will be available on the NXP Investor Relations website within 24 hours of the actual call.

About NXP Semiconductors

NXP Semiconductors N.V. (NASDAQ: NXPI) enables secure connections for a smarter world, advancing solutions that make lives easier, better, and safer. As the world leader in secure connectivity solutions for embedded applications, NXP is driving innovation in the automotive, industrial & IoT, mobile, and communication infrastructure markets. Built on more than 60 years of combined experience and expertise, the company has approximately 29,000 employees in more than 30 countries and posted revenue of $8.61 billion in 2020. Find out more at www.nxp.com.

Forward-looking Statements

This document includes forward-looking statements which include statements regarding NXPs business strategy, financial condition, results of operations, and market data, as well as any other statements which are not historical facts. By their nature, forward-looking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. These factors, risks and uncertainties include the following: the duration and spread of the COVID-19 outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume; market demand and semiconductor industry conditions; the ability to successfully introduce new technologies and products; the demand for the goods into which NXPs products are incorporated; trade disputes between the U.S. and China, potential increase of barriers to international trade and resulting disruptions to NXP's established supply chains; the ability to generate sufficient cash, raise sufficient capital or refinance corporate debt at or before maturity to meet both NXP's debt service and research and development and capital investment requirements; the ability to accurately estimate demand and match manufacturing production capacity accordingly or obtain supplies from third-party producers; the potential impact of the outbreak of COVID-19 on NXP's business, operations, results of operations, financial condition, workforce or the operations or decisions of customers, suppliers or business customers; the access to production capacity from third-party outsourcing partners and any events that might affect their business or NXPs relationship with them including the outbreak of COVID-19 or the requirements to suspend activities with customers or suppliers because of changing import and export regulations; the ability to secure adequate and timely supply of equipment and materials from suppliers; the ability to avoid operational problems and product defects and, if such issues were to arise, to correct them quickly; the ability to form strategic partnerships and joint ventures and to successfully cooperate with alliance partners; the ability to win competitive bid selection processes; the ability to develop products for use in customers equipment and products; the ability to successfully hire and retain key management and senior product engineers; and, the ability to maintain good relationships with NXP's suppliers. In addition, this document contains information concerning the semiconductor industry and NXPs market and business segments generally, which is forward-looking in nature and is based on a variety of assumptions regarding the ways in which the semiconductor industry and NXP's market and business segments may develop. NXP has based these assumptions on information currently available, if any one or more of these assumptions turn out to be incorrect, actual results may differ from those predicted. While NXP does not know what impact any such differences may have on its business, if there are such differences, its future results of operations and its financial condition could be materially adversely affected. There can be no assurances that a pandemic, epidemic or outbreak of a contagious diseases, such as COVID-19, will not have a material and adverse impact on our business, operating results and financial condition in the future. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak to results only as of the date the statements were made. Except for any ongoing obligation to disclose material information as required by the United States federal securities laws, NXP does not have any intention or obligation to publicly update or revise any forward-looking statements after we distribute this document, whether to reflect any future events or circumstances or otherwise. For a discussion of potential risks and uncertainties, please refer to the risk factors listed in our SEC filings. Copies of our SEC filings are available on our Investor Relations website, www.nxp.com/investor or from the SEC website, www.sec.gov.

For further information, please contact: Investors: Media:Jeff Palmer Jacey Zunigajeff.palmer@nxp.com jacey.zuniga@nxp.com+1 408 518 5411 +1 512 895 7398

NXP-CORP

NXP SemiconductorsTable 1: Condensed consolidated statement of operations (unaudited)

($ in millions except Three months ended Full-yearshare data) December September December 31, 27, 31, 2020 2019 2020 2020 2019 Revenue $ 2,507 $ 2,267 $ 2,301 $ 8,612 $ 8,877 Cost of revenue (1,219 ) (1,177 ) (1,092 ) (4,377 ) (4,259 )Gross profit 1,288 1,090 1,209 4,235 4,618 Research and (460 ) (438 ) (424 ) (1,725 ) (1,643 )developmentSelling, general and (221 ) (203 ) (225 ) (879 ) (924 )administrativeAmortization ofacquisition-related (148 ) (418 ) (365 ) (1,327 ) (1,435 )intangible assetsTotal operating (829 ) (1,059 ) (1,014 ) (3,931 ) (4,002 )expensesOther income 4 1 2 114 25 (expense)Operating income 463 32 197 418 641 (loss)Financial income (expense):Extinguishment of (60 ) ? ? (60 ) (11 )debtOther financial (77 ) (106 ) (93 ) (357 ) (339 )income (expense)Income (loss) before 326 (74 ) 104 1 291 income taxesBenefit (provision) (5 ) 57 20 83 (20 )for income taxesResults relating toequity-accounted (1 ) (1 ) (1 ) (4 ) 1 investeesNet income (loss) 320 (18 ) 123 80 272 Less: Net income(loss) attributable 11 4 9 28 29 to non-controllinginterestsNet income (loss)attributable to 309 (22 ) 114 52 243 stockholders Earnings per share data:Net income (loss) per common share attributable to stockholders in $Basic $ 1.10 $ (0.08 ) $ 0.41 $ 0.19 $ 0.86 Diluted $ 1.08 $ (0.08 ) $ 0.40 $ 0.18 $ 0.85 Weighted averagenumber of shares of common stock outstandingduring the period(in thousands):Basic 280,484 279,467 280,766 279,763 282,056 Diluted 285,258 279,467 285,518 283,809 285,911

NXP SemiconductorsTable 2: Condensed consolidated balance sheet (unaudited)

($ in millions) As of December 31, September December 31, 2020 27, 2019 2020ASSETS Current assets: Cash and cash equivalents $ 2,275 $ 3,566 1,045 Accounts receivable, net 765 755 667 Assets held for sale ? ? 50 Inventories, net 1,030 1,064 1,192 Other current assets 254 219 313 Total current assets 4,324 5,604 3,267 Non-current assets: Other non-current assets 1,013 924 732 Property, plant and equipment, net 2,284 2,255 2,448 Identified intangible assets, net 2,242 2,380 3,620 Goodwill 9,984 9,959 9,949 Total non-current assets 15,523 15,518 16,749 Total assets 19,847 21,122 20,016 LIABILITIES AND EQUITY Current liabilities: Accounts payable 991 697 944 Restructuring liabilities-current 60 25 32 Other current liabilities 966 940 815 Short-term debt ? 1,749 ? Total current liabilities 2,017 3,411 1,791 Non-current liabilities: Long-term debt 7,609 7,607 7,365 Restructuring liabilities 14 15 ? Deferred tax liabilities 85 136 282 Other non-current liabilities 971 880 923 Total non-current liabilities 8,679 8,638 8,570 Non-controlling interests 207 197 214 Stockholders? equity 8,944 8,876 9,441 Total equity 9,151 9,073 9,655 Total liabilities and equity 19,847 21,122 20,016

NXP SemiconductorsTable 3: Condensed consolidated statement of cash flows (unaudited)

($ in millions) Three months ended Full-year December September December 31, 27, 31, 2020 2019 2020 2020 2019Cash flows from operating activities:Net income (loss) $ 320 $ (18 ) $ 123 $ 80 $ 272 Adjustments to reconcilenet income (loss) to netcash provided by (used for) operatingactivities:Depreciation and 316 589 522 1,988 2,047 amortizationStock-based compensation 89 83 89 384 346 Amortization of discount ? ? 8 (1 ) 42 (premium) on debt, netAmortization of debt 2 3 3 9 11 issuance costsNet (gain) loss on sale (4 ) (1 ) ? (115 ) (20 )of assets(Gain) loss on 60 ? ? 60 11 extinguishment of debtResults relating toequity-accounted 1 1 1 4 (1 )investeesGain (loss) on equity (21 ) ? ? (21 ) ? securities, netDeferred tax expense (75 ) (118 ) (49 ) (349 ) (175 )(benefit)Changes in operating assets and liabilities:(Increase) decrease inreceivables and other (50 ) (252 ) 144 (51 ) 116 current assets(Increase) decrease in 34 164 (7 ) 163 128 inventoriesIncrease (decrease) inaccounts payable and 333 82 (35 ) 319 (460 )other liabilities(Increase) decrease in 23 (9 ) 7 7 43 other non-current assetsExchange differences 10 5 9 16 15 Other items (9 ) (2 ) (1 ) (11 ) (2 )Net cash provided by(used for) operating 1,029 527 814 2,482 2,373 activities Cash flows from investing activities:Purchase of identified (35 ) (22 ) (30 ) (130 ) (102 )intangible assetsCapital expenditures onproperty, plant and (104 ) (70 ) (138 ) (392 ) (526 )equipmentProceeds from thedisposals of property, 1 2 ? 4 23 plant and equipmentPurchase of interests inbusinesses, net of cash (13 ) ? (1,698 ) (34 ) (1,698 )acquiredProceeds from sale ofinterests in businesses, ? ? ? 161 37 net of cash divestedPurchase of investments (15 ) (15 ) ? (30 ) (19 )Proceeds from the sale of 2 ? ? 2 1 investmentsProceeds from return of 1 ? ? 1 ? equity investmentsNet cash provided by(used for) investing (163 ) (105 ) (1,866 ) (418 ) (2,284 )activities Cash flows from financing activities:Payment of cash ? ? (1,150 ) ? (1,150 )convertible noteProceeds from settlementof cash convertible note ? ? 144 ? 144 hedgePayment of bond hedgederivatives - convertible ? ? (144 ) ? (145 )optionRepurchase of long-term (1,809 ) ? ? (1,809 ) (600 )debtPrincipal payments on ? ? ? ? ? long-term debtProceeds from theissuance of long-term ? ? ? 2,000 1,750 debtCash paid for debt ? ? ? (15 ) (24 )issuance costsDividends paid to (1 ) (34 ) ? (35 ) ? non-controlling interestsDividends paid to common (105 ) (105 ) (105 ) (420 ) (319 )stockholdersProceeds from issuance ofcommon stock through 8 27 14 72 84 stock plansPurchase of treasuryshares and restricted (257 ) (12 ) (74 ) (627 ) (1,443 )stock unit withholdingsCash paid on behalf ofshareholders for tax on ? ? (128 ) ? (128 )repurchased sharesOther, net (1 ) ? ? (1 ) ? Net cash provided by(used for) financing (2,165 ) (124 ) (1,443 ) (835 ) (1,831 )activities Effect of changes inexchange rates on cash 8 2 3 1 (2 )positionsIncrease (decrease) in (1,291 ) 300 (2,492 ) 1,230 (1,744 )cash and cash equivalentsCash and cash equivalents 3,566 3,266 3,537 1,045 2,789 at beginning of periodCash and cash equivalents 2,275 3,566 1,045 2,275 1,045 at end of period Net cash paid during the period for:Interest 125 54 95 336 242 Income tax 45 39 34 148 368 Net gain (loss) on sale of assets:Cash proceeds from the 2 2 ? 165 21 sale of assetsBook value of these 2 (1 ) ? (50 ) (1 )assetsNon-cash investing activities:Non-cash capital 119 62 133 119 133 expenditures

NXP SemiconductorsTable 4: Financial Reconciliation of GAAP to non-GAAP Results (unaudited)

($ in millions) Three months ended Full-year December September December 31, 27, 31, 2020 2019 2020 2020 2019Revenue $ 2,507 $ 2,267 $ 2,301 $ 8,612 $ 8,877 GAAP Gross Profit $ 1,288 $ 1,090 $ 1,209 $ 4,235 $ 4,618 PPA Effects (21 ) (22 ) (28 ) (99 ) (84 )Restructuring ? (12 ) ? (15 ) (3 )Stock Based (12 ) (11 ) (11 ) (45 ) (42 )CompensationMerger-related ? ? ? (1 ) (2 )costsOther incidentals (5 ) ? ? (5 ) ? Non-GAAP Gross $ 1,326 $ 1,135 $ 1,248 $ 4,400 $ 4,749 ProfitGAAP Gross margin 51.4 % 48.1 % 52.5 % 49.2 % 52.0 %Non-GAAP Gross 52.9 % 50.1 % 54.2 % 51.1 % 53.5 %marginGAAP Research and $ (460 ) $ (438 ) $ (424 ) $ (1,725 ) $ (1,643 )developmentRestructuring (22 ) (7 ) ? (39 ) (16 )Stock based (41 ) (39 ) (38 ) (159 ) (141 )compensationMerger-related ? ? (1 ) (1 ) (7 )costsOther incidentals (1 ) (5 ) ? (6 ) ? Non-GAAP Research $ (396 ) $ (387 ) $ (385 ) $ (1,520 ) $ (1,479 )and developmentGAAP Selling,general and $ (221 ) $ (203 ) $ (225 ) $ (879 ) $ (924 )administrativePPA effects (2 ) (1 ) (1 ) (7 ) (9 )Restructuring (16 ) (2 ) 1 (24 ) (9 )Stock based (36 ) (33 ) (40 ) (180 ) (163 )compensationMerger-related ? (1 ) (3 ) (6 ) (24 )costsOther incidentals ? (3 ) (4 ) (8 ) (16 )Non-GAAP Selling,general and $ (167 ) $ (163 ) $ (178 ) $ (654 ) $ (703 )administrativeGAAP amortizationof $ (148 ) $ (418 ) $ (365 ) $ (1,327 ) $ (1,435 )acquisition-relatedintangible assetsPPA effects (148 ) (418 ) (365 ) (1,327 ) (1,435 )Non-GAAPamortization of $ ? $ ? $ ? $ ? $ ? acquisition-relatedintangible assetsGAAP Other income $ 4 $ 1 $ 2 $ 114 $ 25 (expense)Other incidentals 3 ? ? 112 19 Non-GAAP Other $ 1 $ 1 $ 2 $ 2 $ 6 income (expense)GAAP Operating $ 463 $ 32 $ 197 $ 418 $ 641 income (loss)PPA effects (171 ) (441 ) (394 ) (1,433 ) (1,528 )Restructuring (38 ) (21 ) 1 (78 ) (28 )Stock based (89 ) (83 ) (89 ) (384 ) (346 )compensationMerger-related ? (1 ) (4 ) (8 ) (33 )costsOther incidentals (3 ) (8 ) (4 ) 93 3 Non-GAAP Operating $ 764 $ 586 $ 687 $ 2,228 $ 2,573 income (loss)GAAP Operating 18.5 % 1.4 % 8.6 % 4.9 % 7.2 %marginNon-GAAP Operating 30.5 % 25.8 % 29.9 % 25.9 % 29.0 %marginGAAP Financial $ (137 ) $ (106 ) $ (93 ) $ (417 ) $ (350 )income (expense)Non-cash interestexpense on ? ? (8 ) ? (42 )convertible notesForeign exchange (6 ) (3 ) (4 ) (12 ) (17 )gain (loss)Gain (loss) onextinguishment of (60 ) ? ? (60 ) (11 )long-term debtOther financial 19 (3 ) (4 ) 12 (15 )income (expense)Non-GAAP Financial $ (90 ) $ (100 ) $ (77 ) $ (357 ) $ (265 )income (expense)

NXP SemiconductorsTable 5: Adjusted EBITDA and Free Cash Flow (unaudited)

($ in millions) Three months ended Full-year December September December 31, 27, 31, 2020 2019 2020 2020 2019Net income (loss) $ 320 $ (18 ) $ 123 $ 80 $ 272 Reconciling items to adjusted net incomeFinancial (income) 137 106 93 417 350 expense(Benefit) provision 5 (57 ) (20 ) (83 ) 20 for income taxesDepreciation 139 139 131 547 518 Amortization 177 450 391 1,441 1,529 Adjusted net income $ 778 $ 620 $ 718 $ 2,402 $ 2,689 Reconciling items to adjusted EBITDAResults ofequity-accounted 1 1 1 4 (1 )investeesPurchase accounting ? ? 8 17 8 effect on inventoryRestructuring 38 21 (1 ) 78 28 Stock based costs 89 83 89 384 346 Merger-related costs ? 1 4 8 33 Other incidental 1 2 4 (101 ) (3 )items ^1)Adjusted EBITDA $ 907 $ 728 $ 823 $ 2,792 $ 3,100 Trailing twelve month $ 2,792 $ 2,708 $ 3,100 $ 2,792 $ 3,100 adjusted EBITDA ^1) Excludingamortization related to:- other incidental $ 2 $ 6 $ ? $ 8 $ ? items ($ in millions) Three months ended Full-year December September December 2020 2019 31, 2020 27, 2020 31, 2019Net cash provided by(used for) operating $ 1,029 $ 527 $ 814 $ 2,482 $ 2,373 activitiesNet capitalexpenditures on (103 ) (68 ) (138 ) (388 ) (503 )property, plant andequipmentNon-GAAP free cash $ 926 $ 459 $ 676 $ 2,094 $ 1,870 flowNon-GAAP free cashflow as percent of 37 % 20 % 29 % 24 % 21 %Revenue