STMicroelectronics (ST) has agreed to acquire NXP Semiconductors’ micro-electromechanical systems (MEMS) sensors business in a deal valued at up to $950m.

The transaction includes an upfront cash payment of $900m, with an additional $50m contingent on specific technical milestones.

This acquisition focuses primarily on enhancing STMicroelectronics’ capabilities in automotive safety and industrial applications. By integrating NXP’s MEMS technologies, STMicroelectronics aims to broaden its portfolio across these sectors, with significant implications for both automotive and industrial markets.

NXP executive vice president and analogue and automotive embedded systems general manager Jens Hinrichsen said: “NXP is a leading supplier of automotive MEMS based motion and pressure sensors, with a long history of strong customer adoption.

“However, after careful portfolio review the company has decided the business does not fit into its long-term strategic direction. We have agreed with STMicroelectronics that the product line will fit ideally into ST’s portfolio, manufacturing footprint and strategic roadmap.”

MEMS technologies are integral to vehicle safety systems such as airbags and tyre pressure monitoring, as well as various industrial applications including pressure sensors and accelerometers.

The deal is expected to be accretive to STMicroelectronics’ earnings per share immediately upon completion. Financially, the acquired business generated approximately $300m in revenue in 2024.

According to STMicroelectronics, the MEMS sensors sector is experiencing rapid growth, particularly within the automotive industry, where demand for advanced safety and monitoring systems is on the rise.

This acquisition allows STMicroelectronics to strengthen its market position, leveraging established relationships with automotive Tier 1 suppliers.

Incorporating NXP’s MEMS business will also enhance STMicroelectronics’ research and development (R&D) capabilities.

The integration aims to utilise advanced intellectual property and skilled R&D teams to foster faster innovation cycles and offer tailored solutions.

STMicroelectronics analogue, power & discrete, MEMS and sensors group president Marco Cassis said: “The planned acquisition is a great strategic fit for ST.

“Together with ST’s existing MEMS portfolio, these highly complementary technologies and customer relationships, focused on automotive safety and industrial technologies, will strengthen our position in sensors across key segments in automotive, industrial and consumer applications.”

The completion of the acquisition is subject to receipt of regulatory approvals and other customary closing conditions, with an expected closure in the first half of 2026.

Separately, STMicroelectronics reported its second-quarter financial results for 2025. The Switzerland-based company recorded net revenues of $2.77bn with a gross margin of 33.5%.

However, it incurred an operating loss of $133m due to restructuring charges and related costs. For the first half of the year, net revenues reached $5.28bn.

Looking forward, the company projects third-quarter revenues of approximately $3.17bn.