Business Strategy and Outlook
| Brian Colello, CPA |NXP Semiconductors is one of the largest suppliers of semiconductors for the automotive market and a significant force in the analog and mixed signal chip markets generally. We believe the firm has a durable position in the automotive, industrial, mobile, and communications infrastructure markets due to a combination of switching costs and intangible assets. Although the company sells into cyclical industries, the strength of these competitive advantages gives us confidence that the firm will generate excess returns over the cost of capital over the next decade and thus warrants a narrow economic moat rating.