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Xilinx’s Performance in the Industrial, Aerospace, and Defense Market


Jul. 21 2017, Updated 9:12 a.m. ET

Industrial, Aerospace, and Defense

Xilinx’s (XLNX) revenues from its Communications and Data Center segment was sequentially down in fiscal 4Q17 due to seasonal weakness in the data center and slow 4G deployment in China (MCHI). That segment’s weakness was offset by seasonal strength in the Industrial, Aerospace, and Defense segment.

After almost two years, Industrial, Aerospace, and Defense surpassed Communications and Data Center to become Xilinx largest contributor, accounting for 43% of the company’s revenues in fiscal 4Q17. Xilinx dominates the industrial IoT (Internet of Things) market with an 80% share. The industrial market spans the medical, factory automation, surveillance, robotics, and transportation sectors.

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Revenues from Industrial, Aerospace, and Defense

Xilinx’s revenues from Industrial, Aerospace, and Defense rose 9% sequentially to $262 million in fiscal 4Q17, driven by strong seasonal demand in the industrial space. Even Analog Devices (ADI) reported 15% sequential growth in industrial revenues during the same quarter.

Fiscal 2Q and 4Q are seasonally strong quarters for Industrial, Aerospace, and Defense, although they are seasonally weak quarters for Communications and Data Center. As both segments contribute a little over 40% to Xilinx’s revenues, the overall company’s revenues would grow consistently.

Xilinx expects its Industrial, Aerospace, and Defense revenues to remain sequentially flat at ~$262 million in fiscal 1Q18. The company expects the segment’s revenues to grow 5%–9% in fiscal 2018.

Industrial IoT

In the Industrial, Aerospace, and Defense segment, Xilinx’s key growth driver is the emergence of factory automation, industrial IoT (Internet of Things), industrial vision, and medical IoT. The company, in collaboration with Mentor, has brought Android 6.0 (Marshmallow) support on its Zynq UltraScale+ MPSoC (multiprocessor system-on-chip) aimed at the industrial, medical, automotive, and aerospace and defense markets.

Xilinx is combining its MPSoC hardware with Mentor Embedded software solutions to open the Android ecosystem. This move would allow developers to reduce project risk, save time and cost, and create graphics for advanced industrial applications.

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Xilinx Zynq UltraScale+ MPSoC features a quad-core ARM Cortex-A53 application processor for OS (operating systems), a dual-core ARM Cortex-R5 real-time processor, FPGA (field programmable gate array) logic, and Xilinx IP (intellectual property). Xilinx IP assigns specific peripherals and memory regions to each processor type to optimize the functions for its FPGAs. As a result, the MPSoC can to run Android OS and Mentor Nucleus RTOS (real-time operating system) simultaneously.

Mentor Embedded Hypervisor, the Mentor Embedded Multicore Framework, and the Mentor Embedded Linux platform give developers the software that supports advanced heterogeneous safety-critical designs. Mentor Graphics provides the necessary software, tools, and professional services to help developers develop, debug, and optimize advanced designs for Zynq UltraScale+ MPSoC devices, reducing project risk.

Next, we’ll look at Xilinx’s Broadcast, Consumer, and Automotive segment.


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