SOURCE: NXP Semiconductors

NXP Semiconductors

July 29, 2011 05:00 ET

NXP Consolidates No. 1 Position in Worldwide ID Market

EINDHOVEN, NETHERLANDS--(Marketwire - Jul 29, 2011) - NXP Semiconductors N.V. (NASDAQ: NXPI) today announced that it has extended its lead in the global Identification market, after eight quarters of consecutive growth in total sales across all market segments using Identification technologies. With its focus on developing end-to-end solutions for security, convenience and connectivity, as well as its strategy of building entire ecosystems for ID applications, NXP is a clear leader in key segments including eGovernment, transportation and access, RFID tags and labels, infrastructure, NFC and payments. In 2010, NXP's Identification business unit posted global revenues of $589 million across its three product lines Secure Transactions, Secure Identity, and Tagging & Authentication, attaining the No.1 position in the worldwide ID market. In H1 2011, NXP reported revenues of $383 million in Identification, firmly establishing its No. 1 position with recently announced Q2 revenues of $194 million.

"ABI Research believes NXP is uniquely positioned and differentiated from its peers in that the company supports the full range of RFID frequencies from LF to HF to UHF," said Mike Liard, research director for RFID at ABI Research. "Primary applications supported by NXP's transponder ICs are broad and far-reaching, including automobile immobilizers, security/access control, contactless payment, ticketing, NFC, government ID, asset management, item-level tracking, authentication and many others."

"NXP is the volume leader in many of these application areas, particularly within HF-based markets," added John Devlin, ABI Research's practice director for Auto ID and Smart Cards. "In fact, given its recent results and growth in 2010, NXP can claim to be the No. 1 Identification semiconductor company, including both its RFID and secure IC product groups."

Worldwide megatrends in mobility and connectivity, cloud computing, machine-to-machine (M2M) authentication, as well as physical and cyber-security threats are putting mounting pressure on businesses, governments and end users. In turn, the growing demand for more secure, easy-to-use, interactive solutions have opened new opportunities in application areas such as mobile payments, identification in the cloud, and authentication of objects throughout the global supply chain. NXP is ideally positioned to build on its successful track record of creating and developing new markets, delivering value to customers and partners based on its world-leading security technology, the unique breadth of its product portfolio, and its application-driven solution strategy. Working with industry leaders such as Google, Samsung, Sony Ericsson, ZTE, Nokia, BDr, Gemalto, Oberthur, Giesecke & Devrient, Avery Dennison, and many others, NXP is committed to supporting continued innovation across the broader Identification ecosystem.

Market Leadership in Key Sectors
In addition to an overall No. 1 position, NXP has achieved market-leading positions in the following sectors where it has invested in advanced technology platforms, building on its strength in cards and readers to develop end-to-end solutions based on an in-depth understanding of each application area. NXP ranks:

  • No. 1 in eGovernment. 77 out of 91 countries, or 85 percent of worldwide electronic passport projects, have put their trust in NXP's secure microcontrollers such as the SmartMX™.
  • No. 1 in transport and access management. Over 1.2 billion people worldwide have access to NXP's MIFARE™ technology, which has more than 70 percent market share in the automatic fare collection (AFC) industry.
  • No. 1 in RFID tags and labels. With market share of more than 50 percent in RFID, NXP covers the entire tagging market, excelling in fashion and retail apparel, electronics, fast-moving consumer goods (FMCG), media management, and animal identification. NXP recently received the 2011 Frost & Sullivan Customer Value Enhancement Award recognizing its Tagging & Authentication RFID business for its unique multi-application approach, as well as its broad portfolio of technologies including LF, HF and UHF.
  • No. 1 in infrastructure. With over 70 percent market share in infrastructure, NXP delivers full system solutions for customers' contact and contactless readers throughout a very wide range of applications including POS terminals, access gates and doors, set-top-boxes, laptops, accessories and more.
  • No. 1 in NFC and mobile transactions. As co-inventor of near-field communication (NFC) technology, NXP has led development and standard-setting in NFC since 2002, and is able to provide customers with a complete solution including RF, secure elements, and the associated software. NXP provides the complete, embedded secure NFC solution for Google Wallet, and NXP's mobile transactions technology has been adopted by world-leading handset manufacturers such as Samsung, Nokia, LG, ZTE, Sony Ericsson, Huawei and many others.
  • No. 2 in banking. According to ABI Research's payment cards report as of July 2011, NXP saw the greatest increase in shipments in 2010. After winning important dual interface tenders in 2010 and thanks to its focus on contactless technology ABI Research expects NXP to gain even more market share in the near future.

"Consolidating our No. 1 position in Identification validates our application-driven focus, as we continue to evolve and expand the traditional ID market in advanced and emerging economies to support our customers' ever-changing needs. To put it simply, our team is committed to developing end-to-end solutions which enable recognition and add convenience and security to everyday life," said Ruediger Stroh, executive vice president and general manager, Identification, NXP Semiconductors.

Stroh added: "One of the biggest emerging trends we see is convergence within the Identification market and the move toward using one IC for multiple applications -- for example, national ID cards that could be used to access transport and banking services. In addition, we're actively developing solutions for emerging market segments such as authentication within the Smart Grid and securing transactions using mobile technology such as NFC. Working together with our partners, we're exploring new ways for the intelligent recognition of people and objects to protect and connect the physical and virtual worlds we live in today."

Further information on NXP's identification solutions is available at http://www.nxp.com/products/identification_and_security/index.html

About 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. These innovations are used in a wide range of automotive, identification, wireless infrastructure, lighting, industrial, mobile, consumer and computing applications. A global semiconductor company with operations in more than 25 countries, NXP posted revenue of $4.4 billion in 2010. Additional information can be found by visiting www.nxp.com.

Note:
NXP is the market leader in contactless identification ICs and a leader in the overall contact and contactless identification chip market. NXP addresses all segments of the market, except for the commodity SIM market, and has leading positions in e-government, transportation and access management, smart card readers, and radio frequency identification tags and labels.

NXP supplies to approximately 85% of worldwide e-passport projects, and its MIFARE product is used in approximately 70% of the public transport systems that have adopted electronic ticketing.The company has led development and standard-setting in Near Field Communication (NFC), an emerging standard for secure short-range connectivity that has been established to enable secure transactions between mobile devices and point-of-sale terminals or other devices, and is pursuing the fast-growing product authentication market.

NXP's leadership in the identification market is based on the strength of its security, end-to-end system contactless read speed performance, ability to drive new standard settings, and the breadth of its product portfolio. Key growth drivers will be the adoption of new security standards in existing smart card markets, the implementation of security ICs in a range of devices to enable secure mobile transactions and product authentication, and the increase in new radio frequency identification applications such as supply chain management.

Forward-looking Statements:
This document includes forward-looking statements which include statements regarding NXP's 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: market demand and semiconductor industry conditions; the ability to successfully introduce new technologies and products; the end-market demand for the goods into which NXP's products are incorporated; the ability to generate sufficient cash, raise sufficient capital or refinance corporate debt at or before maturity; the ability to meet the combination of corporate debt service, 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 access to production capacity from third-party outsourcing partners; any events that might affect third-party business partners or NXP's relationship with them; 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 to develop products for use in customers' equipment and products; the ability to successfully establish a brand identity; the ability to successfully hire and retain key management and senior product architects; and, the ability to maintain good relationships with our suppliers. In addition, this document contains information concerning the semiconductor industry and NXP's 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, NXP's market segments and product areas 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 market 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. 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 from on our Investor Relations website, www.nxp.com/investor or from the SEC website, www.sec.gov.

Trademarks:
SmartMX, MIFARE, DESFire, MIFARE Plus and MIFARE4Mobile are trademarks of NXP B.V.