UPDATE: Texas Instruments 3Q Profit Falls 4.4% But Tops Views
19 Outubro 2009 - 8:02PM
Dow Jones News
Texas Instruments Inc. (TXN) said third-quarter profit fell 4.4%
on lower sales, though the results topped even its own recent
expectations, led by worldwide strength in its analog chip
business.
The chip maker saw demand grow for the second quarter in a row,
including a 20% increase in analog chips, which are used in
everything from cell phones to industrial equipment.
While Asia showed the strongest demand geographically, Chief
Financial Officer Kevin March said that for the first time in more
than a year, growth is appearing in Europe and the Americas,
signaling that industrial markets are starting to strengthen.
"Demand is beginning to broaden out a little bit," March said in
an interview. The strong sequential growth in analog chips suggests
to TI that it is gaining market share over its rivals, he
added.
Shares rose 3.5% to $24.35 in after-hours trading as TI's
results topped its guidance and the company predicted
fourth-quarter earnings above Wall Street's average expectations.
The stock has gained 75% from a six-year low last December, but has
fallen 7% from its 52-week high last month.
TI's outlook echoes recent predictions of stronger demand by the
world's largest chip maker, Intel Corp. (INTC), and eases concerns
that analog revenue may take longer to recover. Currently, demand
is returning more quickly in consumer segments, March said,
particularly for chips used in smartphones, disk-drives and other
gadgets.
Looking ahead, TI - which makes chips used in everything from
cellphones to industrial machinery - expects fourth-quarter
earnings of 42 cents to 50 cents on revenue between $2.78 billion
and $3.02 billion. Analysts estimated earnings of 40 cents a share
on revenue of $2.78 billion, according to a poll by Thomson
Reuters.
With increased competition in the wireless arena, TI has focused
more on its strengths in analog and embedded processing, and plans
to exit the handset-baseband business by 2012.
In the latest quarter, the chip giant reported a profit of $538
million, or 42 cents a share, down from $563 million, or 43 cents a
share, a year earlier. The latest results included a $10 million
restructuring charge.
Revenue dropped 15% to $2.88 billion.
In September, TI raised its forecast to earnings of 37 cents to
41 cents a share on revenue of $2.73 billion to $2.87 billion.
Gross margin rose to 51.4% from 48.5%. Orders decreased 4%,
while inventory fell 29%.
Revenue declined in all segments, especially wireless, but
profits rose in the analog and embedded processing segments by 12%
and 2.7%, respectively. Wireless profits dropped 29%.
-By Jerry A. DiColo, Dow Jones Newswires; 212-416-2155;
Jerry.DiColo@dowjones.com
(Kathy Shwiff contributed to this report.)