How NXP Semiconductors Stock Gained 11.4% Last Month

Shares of NXP Semiconductors (NASDAQ: NXPI) rose 11.4% in December 2025, according to data from S&P Global Market Intelligence. The Dutch-American chipmaker started the month with a bang, rising 16.7% in the first three days. From there, the stock chart largely held on to its early gains.

Many market watchers suggested that NXP investors were inspired by the latest dividend announcement, aiming to get into the stock before the record date on Dec. 10. However, I'm not so sure that this theory holds water. You see, there was nothing special or inspiring about that dividend announcement.

Image source: Getty Images.

Why the dividend explanation falls flat

Let's start with the dividend facts. NXP paid $1.014 per share today, Jan. 7, 2026, to shareholders of record as of Dec. 10, 2025. That's not a massive increase. NXP has actually issued the same quarterly payment of $1.014 per share since March 2023:

NXPI Normal Dividends Paid (Quarterly) data by YCharts

The press release was also utterly normal. Management said that the dividend payout was motivated by "the continued and significant strength of the NXP capital structure, and the board's confidence in the company's ability to drive long-term growth and strong cash flow."

I'm quoting that boilerplate language to point out how incredibly standard-issue it is. NXP has used that exact statement in every dividend announcement since the summer of 2022, and perhaps even earlier.

So NXP didn't boost its payout and management didn't say anything incredibly bullish about the state of affairs. It was just another ordinary dividend announcement that shouldn't have had the power to boost NXP's stock price by double-digit percentages in just a few days.

NXP's mystery rally

Market moves don't always make sense, and NXP's December jump is an excellent example of this Wall Street noise. Chip stocks generally traded sideways last month; the automotive sector, which represents NXP's largest target market, also held firm, and the stock market itself barely moved.

The only explanation that makes any sense would be that investors suddenly forgave NXP for October's mixed third-quarter report. Even then, it's unclear why Wall Street would suddenly change its collective mind in the first week of December. The stock is now almost exactly in sync with the S&P 500 (SNPINDEX: ^GSPC) index over the last 3 months.

Sometimes the clearest answer is that there is no answer.

In times like these, it's best to remember that investing is more of a marathon than a sprint. You can treat temporary price drops as buying opportunities, especially when it's tough to find credible reasons for the discounts.

But longtime NXP shareholders like yours truly can simply pour another cup of coffee and ignore the market nonsense. Nothing about the company or its long-term business prospects changed in December, even though the price chart made it look like a game-changing month.

Anders Bylund has positions in NXP Semiconductors. The Motley Fool has positions in and recommends NXP Semiconductors. The Motley Fool has a disclosure policy.