Earnings Preview: NXP Semiconductors

NXP Semiconductors NXPI releases its next round of earnings this Monday, April 26. Here is Benzinga's essential guide to NXP Semiconductors's Q1 earnings report.

Net Income, Earnings, And Earnings Per Share

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Wall Street analysts see NXP Semiconductors reporting earnings of $2.21 per share on revenue of $2.56 billion. In the same quarter last year, NXP Semiconductors reported EPS of $1.4 on revenue of $2.02 billion.

Why Analyst Estimates And Earnings Surprises Are Important

Wall Street analysts who study this company will publish analyst estimates of revenue and EPS. The averages of all analyst EPS and revenue estimates are called the "consensus estimates"; these consensus estimates can have a significant effect on a company's performance during an earnings release. When a company posts earnings or revenue above or below a consensus estimate, it has posted an "earnings surprise", which can really move a stock depending on the difference between actual and estimated values.

The Wall Street consensus estimate for earnings would represent a 57.86% increase for the company. Revenue would be up 26.67% on a year-over-year basis. NXP Semiconductors's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

For a full 12 months, the return has risen by 105.23%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. NXP Semiconductors is scheduled to hold the call at 08:00:00 ET and can be accessed here.