UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT TO SECTION 13 OR 15(d)
OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE
OF REPORT (DATE OF EARLIEST EVENT REPORTED): April 21,
2008
TEXAS
INSTRUMENTS INCORPORATED
(Exact
name of registrant as specified in charter)
|
DELAWARE
|
|
001-03761
|
|
75-0289970
|
|
(State
or other jurisdiction of incorporation)
|
|
(Commission
file number)
|
|
(I.R.S.
employer identification
no.)
|
12500
TI BOULEVARD
P.O.
BOX 660199
DALLAS,
TEXAS 75266-0199
(Address
of principal executive offices)
Registrant’s
telephone number, including area code: (972) 995-3773
Check
the
appropriate box below if the Form 8-K is intended to simultaneously satisfy
the
filing obligation of the registrant under any of the following
provisions:
|
¨
|
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
|
¨
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
¨
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
|
|
¨
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
|
ITEM
2.02. Results of Operations and Financial Condition
The
Registrant's news release dated April 21, 2008, regarding its first quarter
2008
results of operations and financial condition is attached hereto as Exhibit
99
and is incorporated by reference herein.
ITEM
5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
Thomas
J.
Engibous retired as an executive officer and Chairman of the Board of the
Registrant effective April 17, 2008. Notice of his retirement was
previously given in a Form 8-K filed on January 17, 2008.
ITEM 9.01. Exhibits
|
Designation
of
Exhibit
in
this
Report
|
|
Description
of Exhibit
|
|
99
|
|
Registrant’s
News Release
|
|
|
|
Dated
April 21, 2008 (furnished pursuant to Item
2.02)
|
“Safe
Harbor” Statement under the Private Securities Litigation Reform Act of 1995:
This report includes forward-looking statements intended to qualify for the
safe
harbor from liability established by the Private Securities Litigation Reform
Act of 1995. These forward-looking statements generally can be identified by
phrases such as TI or its management “believes,” “expects,” “anticipates,”
“foresees,” “forecasts,” “estimates” or other words or phrases of similar
import. Similarly, statements in this report that describe the Company’s
business strategy, outlook, objectives, plans, intentions or goals also are
forward-looking statements. All such forward-looking statements are subject
to
certain risks and uncertainties that could cause actual results to differ
materially from those in forward-looking statements.
We
urge
you to carefully consider the following important factors that could cause
actual results to differ materially from the expectations of TI or its
management:
|
·
|
Market
demand for semiconductors, particularly for analog chips and
digital
signal processors in key markets such as communications, entertainment
electronics and computing;
|
|
·
|
TI’s
ability to maintain or improve profit margins, including its
ability to
utilize its manufacturing facilities at sufficient levels to
cover its
fixed operating costs, in an intensely competitive and cyclical
industry;
|
|
·
|
TI’s
ability to develop, manufacture and market innovative products
in a
rapidly changing technological
environment;
|
|
·
|
TI’s
ability to compete in products and prices in an intensely competitive
industry;
|
|
·
|
TI’s
ability to maintain and enforce a strong intellectual property
portfolio
and obtain needed licenses from third
parties;
|
|
·
|
Expiration
of license agreements between TI and its patent licensees, and
market
conditions reducing royalty payments to
TI;
|
|
·
|
Economic,
social and political conditions in the countries in which TI,
its
customers or its suppliers operate, including security risks,
health
conditions, possible disruptions in transportation networks and
fluctuations in foreign currency exchange
rates;
|
|
·
|
Natural
events such as severe weather and earthquakes in the locations
in which
TI, its customers or its suppliers
operate;
|
|
·
|
Availability
and cost of raw materials, utilities, manufacturing
equipment, third-party manufacturing services and manufacturing
technology;
|
|
·
|
Changes
in the tax rate applicable to TI as the result of changes in
tax law, the
jurisdictions in which profits are determined to be earned and
taxed, the
outcome of tax audits and the ability to realize deferred tax
assets;
|
|
·
|
Losses
or curtailments of purchases from key customers and the timing
and amount
of distributor and other customer inventory
adjustments;
|
|
·
|
Customer
demand that differs from our
forecasts;
|
|
·
|
The
financial impact of inadequate or excess TI inventory that results
from demand that differs from
projections;
|
|
·
|
TI's
ability to access its bank accounts and lines of credit or otherwise
access the capital markets;
|
|
·
|
Product
liability or warranty claims, claims based on epidemic or delivery
failure
or recalls by TI customers for a product containing a TI
part;
|
|
·
|
TI’s
ability to recruit and retain skilled personnel;
and
|
|
·
|
Timely
implementation of new manufacturing technologies, installation
of
manufacturing equipment and the ability to obtain needed third-party
foundry and assembly/test subcontract
services.
|
For
a
more detailed discussion of these factors, see the text under the heading “Risk
Factors” in Item 1A of the Company’s most recent Form 10-K. The
forward-looking statements included in this report on Form 8-K are made only
as
of the date of this report, and the Company undertakes no obligation to update
the forward-looking statements to reflect subsequent events or
circumstances.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
|
|
TEXAS
INSTRUMENTS INCORPORATED
|
||
|
Date:
April 21, 2008
|
|
By:
|
|
/s/
Kevin P. March
|
|
|
|
|
|
Kevin
P. March
|
|
|
|
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Senior
Vice President
|
|
|
|
|
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and
Chief Financial
Officer
|
Exhibit
99
TI
reports financial results for 1Q08
|
·
|
Revenue
is $3.27 billion
|
|
·
|
EPS
is $0.49, including discrete tax items of
$0.06
|
|
·
|
High-performance
analog revenue up 20 percent from year
ago
|
Conference
call on TI web site at 4:30 p.m. Central time today
www.ti.com
Except
as noted, financial results are for continuing operations. The sale
of TI’s former Sensors & Controls business was completed on April 27, 2006,
and that business is reported as a discontinued operation.
DALLAS
(April 21, 2008) – Financial results from Texas Instruments Incorporated (TI)
(NYSE:TXN) for the first quarter reflect the company’s strengthening position in
the market for analog semiconductors.
TI
revenue was up 3 percent from the year-ago quarter, led by 20 percent growth
in
high-performance analog semiconductors. TI’s operating profit grew 19
percent. “Analog is making us stronger and will be a great growth
opportunity for a very long time. Analog goes into almost every piece
of electronic equipment that is made, and at TI we have the technology and
the
manufacturing power to serve much more of this market than we are addressing
today. There also are clear benefits to our operating profit, which
has grown faster than revenue, and to our cash flow, which we can return to
shareholders or reinvest in growth," said Rich Templeton, TI’s chairman,
president and CEO.
Compared
with the fourth quarter, TI revenue declined 8 percent primarily due to weaker
sales into cell phones, especially high-end cell phones. “Given
uncertainty in the near-term economy, we have become more conservative with
our
outlook for the second quarter. More strategically, we believe our
long-term opportunity is excellent. We’re continuing to do the things
needed to be the better choice for our customers, such as adding sales and
applications engineers, investing in new products, and increasing assembly/test
capability,” Templeton said.
“In
addition to traditional markets in communications and entertainment, analog
semiconductors and digital signal processors are at the heart of solving some
of
the world’s most challenging problems in healthcare, energy and
security. We’ve achieved early positions in each of these, all
of which are just beginning to leverage semiconductor technology,” Templeton
said.
TI
financial results
|
·
|
Revenue
was $3.27 billion, up $81 million, or 3 percent, from a year
ago. Compared with the prior quarter, revenue decreased $284
million, or 8 percent.
|
|
·
|
Gross
profit was $1.76 billion, or 53.7 percent of revenue. This was
up $119 million from a year ago. Gross profit declined $170
million from the prior quarter.
|
|
·
|
Operating
expenses were $514 million for research and development (R&D) and $435
million for selling, general and administrative
(SG&A). R&D expense decreased $38 million from a year
ago as the company continues to benefit from its collaborative work
with
foundries on advanced digital process technologies. R&D
expense was about the same as the prior quarter. SG&A
expense increased $30 million from the year-ago quarter primarily
due to
higher investments in field sales and customer support, especially
for
emerging regions. SG&A expense increased $13 million from
the prior quarter.
|
|
·
|
Operating
profit was $807 million, or 24.7 percent of revenue. This was
an increase of $127 million from the year-ago
quarter. Operating profit decreased $189 million from the prior
quarter.
|
|
·
|
Other
income was $33 million. This was down $6 million from the
year-ago quarter and down $13 million from the prior quarter due
to lower
interest income.
|
|
·
|
Income
from continuing operations was $662 million, including a discrete
tax
benefit of $81 million associated with the company’s decision
to indefinitely reinvest the accumulated earnings of a non-U.S.
subsidiary. Income from continuing operations increased
$146 million from the year-ago quarter and declined $91 million from
the
prior quarter.
|
|
·
|
Earnings
per share (EPS) were $0.49 and included a discrete tax benefit of
$0.06. EPS increased $0.14 from the year-ago quarter and
decreased $0.05 from the prior
quarter.
|
|
·
|
Orders
were $3.32 billion. This was an increase of $111 million from
the year-ago quarter and a decline of $164 million from the prior
quarter.
|
|
·
|
Cash
flow from operations was $641 million, an increase of $87 million
from a
year ago and a decrease of $781 million from the prior
quarter.
|
|
·
|
Accounts
receivable were $1.67 billion at the end of the quarter. This
was a decrease of $87 million from the year-ago quarter and a decrease
of
$73 million from the prior quarter. Days sales outstanding were
46 at the end of the quarter compared with 50 a year ago and 44 at
the end
of the prior quarter.
|
|
·
|
Inventory
was $1.58 billion at the end of the quarter. This was $169
million higher than the year-ago quarter and $160 million higher
than the
prior quarter. Days of inventory at the end of the first
quarter were 94, up 12 days from a year ago and up 16 days from the
prior
quarter.
|
|
·
|
Capital
spending totaled $219 million. Depreciation was $241
million.
|
|
·
|
Total
cash (cash and cash equivalents plus short-term investments) was
$1.88
billion at the end of the quarter. This was $1.46 billion lower
than a year ago and $1.05 billion lower than the prior
quarter. The company reduced its holdings of auction-rate
securities, which are based on pools of student loans that are guaranteed
by the U.S. Department of Education, by $473 million from the end
of the
prior quarter. As of the end of the first quarter, TI
reclassified its remaining auction-rate securities, which have a
fair
value of $551 million, from short-term investments to long-term
investments due to reduced liquidity for these securities. The
company used $874 million in the quarter to repurchase 28.6 million
shares
of its common stock and paid dividends of $133
million.
|
Outlook
For
the second quarter of 2008, TI currently expects its
financial results to fall within the following ranges:
|
Total
TI revenue:
|
$3.24
- 3.50 billion
|
|
Semiconductor
revenue:
|
$3.08
- 3.32 billion
|
|
Education
Technology revenue:
|
$160
- 180 million
|
|
EPS:
|
$0.42
– 0.48
|
The
company will update its second-quarter outlook on June 9, 2008.
For
the
full year 2008, TI continues to expect the following:
|
R&D
expense:
|
$2.0
billion
|
|
Capital
expenditures:
|
$0.9
billion
|
|
Depreciation:
|
$1.0
billion
|
|
Annual
effective tax rate:
|
31%
|
TEXAS
INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated
Statements of Income
(Millions
of dollars, except share and per-share amounts)
|
For
Three Months Ended
|
||||||||||||
|
Mar.
31, 2008
|
Dec.
31, 2007
|
Mar.
31, 2007
|
||||||||||
|
Net
revenue
|
$ |
3,272
|
$ |
3,556
|
$ |
3,191
|
||||||
|
Cost
of revenue
|
1,516
|
1,630
|
1,554
|
|||||||||
|
Gross
profit
|
1,756
|
1,926
|
1,637
|
|||||||||
|
Research
and development (R&D)
|
514
|
508
|
552
|
|||||||||
|
Selling,
general and administrative (SG&A)
|
435
|
422
|
405
|
|||||||||
|
Total
operating costs and expenses
|
2,465
|
2,560
|
2,511
|
|||||||||
|
Profit
from operations
|
807
|
996
|
680
|
|||||||||
|
Other
income (expense) net
|
33
|
46
|
39
|
|||||||||
|
Income
from continuing operations before income taxes
|
840
|
1,042
|
719
|
|||||||||
|
Provision
for income taxes
|
178
|
289
|
203
|
|||||||||
|
Income
from continuing operations
|
662
|
753
|
516
|
|||||||||
|
Income from
discontinued operations, net of taxes
|
--
|
3
|
--
|
|||||||||
|
Net
income
|
$ |
662
|
$ |
756
|
$ |
516
|
||||||
|
Basic
earnings per common share:
|
||||||||||||
|
Income
from continuing operations
|
$ |
.50
|
$ |
.55
|
$ |
.36
|
||||||
|
Net
income
|
$ |
.50
|
$ |
.55
|
$ |
.36
|
||||||
|
Diluted
earnings per common share:
|
||||||||||||
|
Income
from continuing operations
|
$ |
.49
|
$ |
.54
|
$ |
.35
|
||||||
|
Net
income
|
$ |
.49
|
$ |
.54
|
$ |
.35
|
||||||
|
Average
shares outstanding (millions):
|
||||||||||||
|
Basic
|
1,327
|
1,372
|
1,442
|
|||||||||
|
Diluted
|
1,347
|
1,399
|
1,470
|
|||||||||
|
Cash
dividends declared per share of common stock
|
$ |
.10
|
$ |
.10
|
$ |
.04
|
||||||
|
Percentage
of revenue:
|
||||||||||||
|
Gross
profit
|
53.7 | % | 54.2 | % | 51.3 | % | ||||||
|
R&D
|
15.7 | % | 14.3 | % | 17.3 | % | ||||||
|
SG&A
|
13.3 | % | 11.9 | % | 12.7 | % | ||||||
|
Operating
profit
|
24.7 | % | 28.0 | % | 21.3 | % | ||||||
TEXAS
INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated
Balance Sheets
(Millions
of dollars, except share amounts)
|
Mar.
31,
2008
|
Dec.
31,
2007
|
Mar.
31,
2007
|
||||||||||
|
Assets
|
||||||||||||
|
Current
assets:
|
||||||||||||
|
Cash
and cash
equivalents
|
$ |
1,450
|
$ |
1,328
|
$ |
965
|
||||||
|
Short-term
investments
|
426
|
1,596
|
2,371
|
|||||||||
|
Accounts
receivable, net of allowances of ($25), ($26) and ($25)
|
1,669
|
1,742
|
1,756
|
|||||||||
|
Raw
materials
|
111
|
105
|
114
|
|||||||||
|
Work
in
process
|
943
|
876
|
879
|
|||||||||
|
Finished
goods
|
524
|
437
|
416
|
|||||||||
|
Inventories
|
1,578
|
1,418
|
1,409
|
|||||||||
|
Deferred
income
taxes
|
659
|
654
|
1,071
|
|||||||||
|
Prepaid
expenses and other current
assets
|
193
|
180
|
261
|
|||||||||
|
Total
current
assets
|
5,975
|
6,918
|
7,833
|
|||||||||
|
Property,
plant and equipment at
cost
|
7,493
|
7,568
|
7,715
|
|||||||||
|
Less
accumulated
depreciation
|
(3,908 | ) | (3,959 | ) | (3,835 | ) | ||||||
|
Property,
plant and equipment,
net
|
3,585
|
3,609
|
3,880
|
|||||||||
|
Long-term
investments
|
791
|
267
|
250
|
|||||||||
|
Goodwill
|
838
|
838
|
792
|
|||||||||
|
Acquisition-related
intangibles
|
105
|
115
|
131
|
|||||||||
|
Deferred
income
taxes
|
618
|
510
|
436
|
|||||||||
|
Capitalized
software licenses,
net
|
225
|
227
|
280
|
|||||||||
|
Overfunded
retirement
plans
|
122
|
105
|
54
|
|||||||||
|
Other
assets
|
79
|
78
|
94
|
|||||||||
|
Total
assets
|
$ |
12,338
|
$ |
12,667
|
$ |
13,750
|
||||||
|
Liabilities
and Stockholders’ Equity
|
||||||||||||
|
Current
liabilities:
|
||||||||||||
|
Current
portion of long-term
debt
|
$ |
--
|
$ |
--
|
$ |
43
|
||||||
|
Accounts
payable
|
680
|
657
|
550
|
|||||||||
|
Accrued
expenses and other
liabilities
|
871
|
1,117
|
877
|
|||||||||
|
Income
taxes
payable
|
218
|
53
|
286
|
|||||||||
|
Accrued
profit sharing and
retirement
|
79
|
198
|
51
|
|||||||||
|
Total
current
liabilities
|
1,848
|
2,025
|
1,807
|
|||||||||
|
Underfunded
retirement
plans
|
191
|
184
|
197
|
|||||||||
|
Deferred
income
taxes
|
60
|
49
|
10
|
|||||||||
|
Deferred
credits and other
liabilities
|
382
|
434
|
453
|
|||||||||
|
Total
liabilities
|
2,481
|
2,692
|
2,467
|
|||||||||
|
Stockholders’
equity:
|
||||||||||||
|
Preferred
stock, $25 par value. Authorized -- 10,000,000 shares.
Participating cumulative preferred. None
issued.
|
--
|
--
|
--
|
|||||||||
|
Common
stock, $1 par value. Authorized -- 2,400,000,000
shares. Shares issued: March 31, 2008 --
1,739,660,927; Dec. 31, 2007 -- 1,739,632,601; March 31, 2007 --
1,739,211,844
|
1,740
|
1,740
|
1,739
|
|||||||||
|
Paid-in
capital
|
926
|
931
|
822
|
|||||||||
|
Retained
earnings
|
20,318
|
19,788
|
18,017
|
|||||||||
|
Less
treasury common stock at cost:
Shares: March
31, 2008
-- 416,925,336; Dec. 31, 2007 -- 396,421,798; March 31, 2007 --
305,502,566
|
(12,776 | ) | (12,160 | ) | (8,940 | ) | ||||||
|
Accumulated
other comprehensive loss, net of taxes
|
(351 | ) | (324 | ) | (355 | ) | ||||||
|
Total
stockholders’ equity
|
9,857
|
9,975
|
11,283
|
|||||||||
|
Total
liabilities and stockholders’
equity
|
$ |
12,338
|
$ |
12,667
|
$ |
13,750
|
||||||
TEXAS
INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated
Statements of Cash Flows
(Millions
of dollars)
|
For
Three Months Ended
|
||||||||||||
|
Mar.
31, 2008
|
Dec.
31, 2007
|
Mar.
31, 2007
|
||||||||||
|
Cash
flows from operating activities:
|
||||||||||||
|
Net
income
|
$ |
662
|
$ |
756
|
$ |
516
|
||||||
|
Adjustments
to reconcile net income to cash provided by operating
activities
of continuing operations:
|
||||||||||||
|
(Income) from
discontinued
operations
|
--
|
(3 | ) |
--
|
||||||||
|
Depreciation
|
241
|
253
|
252
|
|||||||||
|
Stock-based
compensation
|
54
|
67
|
78
|
|||||||||
|
Amortization
of acquisition-related
intangibles
|
10
|
10
|
14
|
|||||||||
|
Losses
on sales of
assets
|
6
|
--
|
--
|
|||||||||
|
Deferred
income
taxes
|
(74 | ) |
4
|
(3 | ) | |||||||
|
Increase
(decrease) from changes in:
|
||||||||||||
|
Accounts
receivable
|
89
|
284
|
17
|
|||||||||
|
Inventories
|
(160 | ) |
32
|
28
|
||||||||
|
Prepaid
expenses and other current
assets
|
(46 | ) |
26
|
(79 | ) | |||||||
|
Accounts
payable and accrued
expenses
|
(179 | ) | (20 | ) | (167 | ) | ||||||
|
Income
taxes
payable
|
165
|
(47 | ) |
33
|
||||||||
|
Accrued
profit sharing and
retirement
|
(122 | ) |
52
|
(111 | ) | |||||||
|
Excess
tax benefit from share-based payments
|
(13 | ) | (10 | ) | (34 | ) | ||||||
|
Change
in funded status of retirement plans and accrued
retirement
|
(4 | ) | (3 | ) | 1 | |||||||
|
Other
|
12
|
21
|
9
|
|||||||||
|
Net
cash provided by operating activities of continuing
operations
|
641
|
1,422
|
554
|
|||||||||
|
Cash
flows from investing activities:
|
||||||||||||
|
Additions
to property, plant and
equipment
|
(219 | ) | (181 | ) | (179 | ) | ||||||
|
Purchases
of cash
investments
|
(362 | ) | (794 | ) | (846 | ) | ||||||
|
Sales
and maturities of cash
investments
|
958
|
2,067
|
1,011
|
|||||||||
|
Purchases
of long-term
investments
|
(2 | ) | (4 | ) | (5 | ) | ||||||
|
Sales
of long-term
investments
|
16
|
2
|
2
|
|||||||||
|
Acquisitions,
net of cash
acquired
|
--
|
(56 | ) | (27 | ) | |||||||
|
Net
cash provided by (used in) investing activities of continuing
operations
|
391
|
1,034
|
(44 | ) | ||||||||
|
Cash
flows from financing activities:
|
||||||||||||
|
Dividends
paid
|
(133 | ) | (138 | ) | (58 | ) | ||||||
|
Sales
and other common stock
transactions
|
76
|
67
|
154
|
|||||||||
|
Excess
tax benefit from share-based
payments
|
13
|
10
|
34
|
|||||||||
|
Stock
repurchases
|
(874 | ) | (1,877 | ) | (857 | ) | ||||||
|
Net
cash used in financing activities of continuing operations
|
(918 | ) | (1,938 | ) | (727 | ) | ||||||
|
Effect
of exchange rate changes on
cash
|
8
|
3
|
(1 | ) | ||||||||
|
Net
increase (decrease) in cash and cash equivalents
|
122
|
521
|
(218 | ) | ||||||||
|
Cash
and cash equivalents, beginning of
period
|
1,328
|
807
|
1,183
|
|||||||||
|
Cash
and cash equivalents, end of
period
|
$ |
1,450
|
$ |
1,328
|
$ |
965
|
||||||
Certain
amounts in prior periods’ financial statements have been reclassified to conform
to the current presentation.
Segment
Net Revenue
(Millions
of dollars)
|
For
Three Months Ended
|
||||||||||||
|
Mar.
31,
2008
|
Dec.
31,
2007
|
Mar.
31,
2007
|
||||||||||
|
Semiconductor
|
$ |
3,191
|
$ |
3,475
|
$ |
3,115
|
||||||
|
Education
Technology
|
81
|
81
|
76
|
|||||||||
|
Total
net
revenue
|
$ |
3,272
|
$ |
3,556
|
$ |
3,191
|
||||||
Segment
Profit (Loss)
(Millions
of dollars)
|
For
Three Months Ended
|
||||||||||||
|
Mar.
31,
2008
|
Dec.
31,
2007
|
Mar.
31,
2007
|
||||||||||
|
Semiconductor
|
$ |
927
|
$ |
1,117
|
$ |
831
|
||||||
|
Education
Technology
|
18
|
19
|
16
|
|||||||||
|
Corporate*
|
(138 | ) | (140 | ) | (167 | ) | ||||||
|
Profit
from
operations
|
$ |
807
|
$ |
996
|
$ |
680
|
||||||
|
*Corporate
includes stock-based compensation
expense:
|
Semiconductor
segment
|
·
|
Revenue
was $3.19 billion. This was 2 percent higher than a year ago
primarily due to higher sales of analog products, especially
high-performance analog products. Revenue declined 8 percent
from the prior quarter primarily due to lower demand for digital
signal
processing products sold into cell phone
applications.
|
|
·
|
Analog
product revenue was $1.32 billion. This was up 6 percent
compared with a year ago due to stronger demand for high-performance
analog products. Revenue was down 4 percent from the prior
quarter primarily due to weaker demand for application-specific analog
products sold into hard-disk drive and cell phone
applications. Revenue from high-performance analog products
increased 20 percent from a year ago and was about even with the
prior
quarter.
|
|
·
|
Digital
signal processing product revenue was $1.12 billion. This was a
decrease of 3 percent from a year ago and a decrease of 18 percent
from
the prior quarter. Both declines were due to lower sales into
cell phone applications.
|
|
·
|
TI’s
remaining semiconductor revenue was $754 million. This was up 6
percent from a year ago and was up 2 percent from the prior
quarter.
|
|
·
|
Gross
profit was $1.73 billion, or 54.3 percent of revenue. This was
up $102 million, or 6 percent, from the year-ago quarter primarily
due to higher revenue from more-profitable analog products, and
to a lesser extent, from microcontrollers. Gross profit was
down $165 million, or 9 percent, from the prior quarter due to lower
revenue.
|
|
·
|
Operating
profit for the first quarter was $927 million, or 29.0 percent of
revenue. This was an increase of $96 million from the year-ago
quarter and a decrease of $190 million from the prior
quarter.
|
|
·
|
Orders
in the first quarter were $3.17 billion. This was up 3 percent
from the year-ago quarter and down 7 percent from the prior
quarter.
|
Semiconductor
highlights
|
·
|
TI
introduced a family of analog front-end chips that enable superior
image quality and reduced power consumption in medical ultrasound
diagnostic equipment.
|
|
·
|
TI
delivered the industry’s first closed-loop, digital-input
Class-D audio amplifier that improves sound quality and lowers
audio subsystem costs in high-definition TVs and media docking
stations.
|
|
·
|
TI
demonstrated a prototype cell phone based on the Android open source
platform and built using TI’s OMAP™ applications processor and
connectivity solutions.
|
Education
Technology segment
|
·
|
Revenue
was $81 million. This was an increase of $5 million, or 7
percent, from the year-ago quarter due to higher sales of graphing
calculators. Revenue was even with the prior
quarter.
|
|
·
|
Gross
profit was $49 million, or 60.5 percent of revenue. This was an
increase of $4 million from the year-ago quarter and was a decrease
of $1
million from the prior quarter.
|
|
·
|
Operating
profit was $18 million, or 21.9 percent of revenue. This was an
increase of $2 million from the year-ago quarter and a decrease of
$1
million from the prior quarter.
|
# # #
“Safe
Harbor” Statement under the Private Securities Litigation Reform Act of
1995:
This
release includes forward-looking statements intended to qualify for the safe
harbor from liability established by the Private Securities Litigation Reform
Act of 1995. These forward-looking statements generally can be
identified by phrases such as TI or its management “believes,” “expects,”
“anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of
similar import. Similarly, statements herein that describe TI’s
business strategy, outlook, objectives, plans, intentions or goals also are
forward-looking statements. All such forward-looking statements are
subject to certain risks and uncertainties that could cause actual results
to
differ materially from those in forward-looking statements.
We
urge
you to carefully consider the following important factors that could cause
actual results to differ materially from the expectations of TI or its
management:
|
·
|
Market
demand for semiconductors, particularly for analog chips and
digital
signal processors in key markets such as communications, entertainment
electronics and computing;
|
|
·
|
TI’s
ability to maintain or improve profit margins, including its
ability to
utilize its manufacturing facilities at sufficient levels to
cover its
fixed operating costs, in an intensely competitive and cyclical
industry;
|
|
·
|
TI’s
ability to develop, manufacture and market innovative products
in a
rapidly changing technological
environment;
|
|
·
|
TI’s
ability to compete in products and prices in an intensely
competitive
industry;
|
|
·
|
TI’s
ability to maintain and enforce a strong intellectual property
portfolio
and obtain needed licenses from third
parties;
|
|
·
|
Expiration
of license agreements between TI and its patent licensees,
and market
conditions reducing royalty payments to
TI;
|
|
·
|
Economic,
social and political conditions in the countries in which TI,
its
customers or its suppliers operate, including security risks,
health
conditions, possible disruptions in transportation networks
and
fluctuations in foreign currency exchange
rates;
|
|
·
|
Natural
events such as severe weather and earthquakes in the locations
in which
TI, its customers or its suppliers
operate;
|
|
·
|
Availability
and cost of raw materials, utilities, manufacturing equipment,
third-party
manufacturing services and manufacturing
technology;
|
|
·
|
Changes
in the tax rate applicable to TI as the result of changes in
tax law, the
jurisdictions in which profits are determined to be earned
and taxed, the
outcome of tax audits and the ability to realize deferred tax
assets;
|
|
·
|
Losses
or curtailments of purchases from key customers and the timing
and amount
of distributor and other customer inventory
adjustments;
|
|
·
|
Customer
demand that differs from our
forecasts;
|
|
·
|
The
financial impact of inadequate or excess TI inventory that
results from
demand that differs from
projections;
|
|
·
|
TI's
ability to access its bank accounts and lines of credit or
otherwise
access the capital markets;
|
|
·
|
Product
liability or warranty claims, claims based on epidemic or
delivery failure
or recalls by TI customers for a product containing a TI
part;
|
|
·
|
TI’s
ability to recruit and retain skilled personnel;
and
|
|
·
|
Timely
implementation of new manufacturing technologies, installation
of
manufacturing equipment and the ability to obtain needed
third-party
foundry and assembly/test subcontract
services.
|
For
a
more detailed discussion of these factors see the Risk Factors discussion in
Item 1A of our most recent Form 10-K. The forward-looking statements
included in this release are made only as of the date of this release and TI
undertakes no obligation to update the forward-looking statements to reflect
subsequent events or circumstances.
About
Texas Instruments
Texas
Instruments (NYSE: TXN) helps customers solve problems and develop new
electronics that make the world smarter, healthier, safer, greener and more
fun. A global semiconductor company, TI innovates through
manufacturing, design and sales operations in more than 25 countries. For
more information, go to www.ti.com.
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