AP News, April 23rd, 2007
Texas Instruments Inc. reported a 4 percent drop in first quarter earnings Monday as the world's leading maker of chips for cell phones dealt with a glut of inventory and shifting demand in the wireless market toward lower-end phones with less-expensive chips.
But its earnings still exceeded Wall Street expectations and the company said it expected growth to resume in the current quarter. Its shares rose in after-hours activity.
Texas Instruments said it earned $516 million, or 35 cents per share, in the most recent quarter compared to $585 million, or 36 cents per share a year earlier. Revenue fell to $3.19 billion from $3.33 billion a year ago.
Analysts were expecting 31 cents per share profit on sales of $3.15 billion for the January-March quarter, according to a survey by Thomson Financial.
Rich Templeton, TI president and CEO, offered a rosier outlook moving forward, saying that the excess inventory that has plagued the company for the past few quarters appeared to be easing.
"Orders are beginning to rebound, and we expect sequential growth to resume in the second quarter," he said in a news release.
He added that all things considered, his company "performed considerably better than in prior troughs because of a more resilient manufacturing strategy and a stronger portfolio of analog products."
The report was posted after markets closed Monday. TI shares closed down 9 cents to $32.41 on the New York Stock Exchange. The stock, which has ranged from $26.77 to $35.89 in the last year, gained about 8 percent in after-hours electronic trading.
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