Texas Instruments' Outlook Falls Short of Wall Street Expectations -- Update
October 23 2018 - 6:09PM
Dow Jones News
By Maria Armental
Texas Instruments Inc.'s (TXN) forecast for the current quarter
fell short of Wall Street expectations after demand slowed across
most markets.
On a Tuesday conference call with analysts, Texas Instruments
executives attributed weaker demand to a slowdown in the
semiconductor sector.
"We really can't speak to any macro-driven event here," Chief
Financial Officer Rafael Lizardi said on the call, adding that the
company expects minimal effects from tariffs or related trade
issues.
In response, Mr. Lizardi said, the company will take a series of
steps, including reducing wafer starts while building inventory
buffers for industrial and automotive--two areas on which the
company has been focusing for long-term growth.
"Those are low risk buffers," Mr. Lizardi said in a conference
call. "Those parts live for a long, long time and they enable us to
then support our customers on the other side of this slowdown."
For the current quarter, the company expects a profit of $1.14
to $1.34 a share on $3.6 billion to $3.9 billion in revenue,
compared with the consensus forecast of $1.38 a share on $4 billion
in revenue, according to analysts surveyed by FactSet.
Meanwhile, Texas Instruments' third-quarter profit rose 22% to
$1.57 billion, or $1.58 a share, just ahead of the consensus
estimate from analysts of $1.54 a share and at the high-end of the
company's forecast of $1.41 to $1.63 a share.
Revenue rose 4% to $4.26 billion. The company had forecast
revenue between $4.11 billion and $4.45 billion, while analysts
forecast $4.3 billion.
Shares in Texas Instruments fell 5.2% to $95.09 in after-hours
trading.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
October 23, 2018 17:54 ET (21:54 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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