Advanced driver-assistance systems: NXP reports 50% annual growth rate since 2015 of their ADAS business

NXP Semiconductor has published its Q1 operating profit of $54 million that is 61% lower compared to their last year's quarterly report. We could not help noticing an interesting feature in the results of their automotive electronics design sector: the NXP's traditional semiconductor business declined but advanced driver assistance systems (ADAS) and battery management systems (BMS) showed significant growth.

NXP CEO Rick Clemmer explains:

“30% of our auto business is focused on high growth sectors like ADAS and electrification which has grown at nearly 40% in compounded growth rate since 2015…”

ADAS are electronic systems with a purpose to facilitate the process of driving. The technology allows to detect objects, alert drivers of dangers on the road and can help slow or stop the vehicle. These processes are implemented through such driver-assistance systems as cameras and radars, anti-lock brakes, electric power steering assistance, adaptive cruise, and traction controls.

Cameras. Before the development of the advanced driver-assistance systems, cams served as “viewers” for blind spots. Nowadays functionality of this instrument is expended to recognizing vehicles, pedestrians, and traffic signs.

Radar system typically consists of a transmitter, waveguides, antenna, receiver, and processing unit. This system uses for blind spot monitoring, object detection, and collision warning based on radar technology and using the data from the radar-based system. Drivers can be saved by counter steering and braking.

Rick Clemmer notes:

“We believe this growth rate is about 1.4 times faster than the overall ADAS radar market, which is still in its relative infancy”

As you can see, the ADAS market is very promising, so we will follow the updates and will continue this topic next week. Stay tuned!