AUSTIN, Texas — (BUSINESS WIRE) — October 22, 2015 — Freescale Semiconductor, Ltd. (NYSE: FSL) today announced financial results for the third quarter ended October 2, 2015. Highlights include:

“Third quarter results represented another quarter of solid execution in a challenging environment,” said Gregg Lowe, president and CEO. Although revenues declined sequentially and year-over-year, the team delivered gross margins that were in line with Q2 and 180 basis points above third quarter last year. We managed operating expenses lower than prior periods and continued to deleverage the balance sheet. This, combined with the execution on gross margins, contributed to adjusted earnings per share of $0.54.”

“The fourth quarter will pose challenges as market conditions have continued to weaken,” Lowe said. “Our results will be impacted in the quarter by normal seasonal declines in our automotive related businesses, continued weakness in wireless infrastructure and enterprise spending which will negatively impact our RF and Digital Networking businesses and weak end-demand in industrial which will lead to lower Microcontroller revenues. Looking past the near term demand softness, we are encouraged by the growth prospects in our core markets and the significant value creation inherent in the combination with NXP Semiconductors.”

*Adjusted for various items as indicated and defined in Note 1 to the Notes to the Consolidated Financial Information attached to this press release.
**Reflects EBITDA excluding the effect of other items.

Third Quarter Highlights

Net sales for the third quarter of 2015 were $1.12 billion, compared to $1.20 billion in the second quarter of 2015 and $1.21 billion in the third quarter of 2014.

Operating earnings for the period were $188 million, compared to $226 million in the second quarter of 2015 and $215 million in the third quarter of 2014. Third quarter 2015 operating earnings included $35 million of reorganization of business, merger expenses and other costs. These costs included an accrual for indemnification costs associated with ongoing semiconductor clean room litigation and ongoing costs associated with the company’s planned merger with NXP Semiconductors.