NXP Semiconductors shares surged about 26 percent on April 29, raising the likelihood of the stock posting its biggest rise since its 2010 listing.

CNBC reported that buying accelerated after the company’s first-quarter results, released the day before, topped market expectations. The company posted adjusted earnings per share of $3.05, beating the $2.95 estimate compiled by market research firm LSEG. Revenue rose 12 percent from a year earlier to $3.18 billion, also above the $3.16 billion estimate.

The market reaction went beyond the headline numbers. Investors focused on the company’s potential to benefit from expanding data centre infrastructure demand while maintaining a business structure centred on automotive and industrial semiconductors. NXP Semiconductors Chief Executive Officer Rafael Sotomayor (라파엘 소토마요르) cited demand for industrial and automotive processing that supports software-defined vehicles and physical AI as drivers of growth.

NXP Semiconductors does not make graphics processing units like Nvidia or AMD. Instead, it has a high share of automotive chips and focuses on power and infrastructure control in data centres rather than AI computing semiconductors. On the earnings conference call, Sotomayor said that as data centres grow, constraints are not limited to computing and memory, adding that power, cooling, uptime and security control are becoming important together and that this is where NXP Semiconductors plays a role.

The company said its data centre-related revenue was about $200 million last year. Sotomayor said he expects the figure to exceed $500 million in 2026. That sharpened its direction to build a bigger presence in the data centre infrastructure market while remaining focused on automotive and industrial semiconductors.

Brokerages also raised price targets immediately after the results. TD Cowen lifted its price target to $310 from $250. Morgan Stanley raised its target to $335 from $299. Morgan Stanley analyst Joseph Moore said NXP Semiconductors clearly showed confidence and clarity supporting its long-term growth story and that visibility on its execution has also become clearer.

Sentiment across the broader semiconductor sector is also supportive. The VanEck Semiconductor ETF, which reflects moves in major semiconductor stocks, is up about 30 percent this month. In that trend, NXP Semiconductors appears to be getting a re-rating as a stock tied not only to traditional automotive semiconductors but also to data centre infrastructure demand driven by the spread of AI.

NXP Semiconductors’ position, though, differs from suppliers of AI computing chips. The growth points it highlighted were not GPU demand but core infrastructure needed to operate data centres, such as power, cooling and security control. The market is expected to watch whether growth in automotive and industrial semiconductors continues and whether data centre-related revenue expands to the level the company outlined.