UPDATE 3-Texas Instruments narrows 2nd-qtr outlook

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SAN FRANCISCO, June 9 (Reuters) - Texas Instruments Inc (TXN.N) on Monday narrowed its quarterly earnings and revenue target range as improving demand for chips used in high-speed wireless phones was offset by weakness in demand for chips used in lower-end phones.

TI, which makes chips for everything from cell phones to industrial equipment, narrowed its second-quarter earnings per share forecast to 43 cents to 47 cents from an earlier target given in April, which had disappointed investors, for earnings of 42 cents to 48 cents per share.

It tweaked its revenue target range for the quarter to $3.33 billion to $3.46 billion from an earlier $3.24 billion to $3.5 billion, issued when TI was seeing weak demand for chips for third-generation (3G) phones with faster Web links.

The company, whose biggest client is handset leader Nokia (NOK1V.HE), said on Monday that while 3G chip demand was improving from very weak first-quarter levels, the increase was not enough to offset worsening demand for cheaper phones.

TI's head of investor relations, Ron Slaymaker, said in a brief conference call with analysts it was not clear whether demand trends related to specific customers or to general market conditions.

"There are a couple of areas where we are seeing weakness, one of which is wireless handset revenue, which continues to be unseasonably weak and we would expect that it's probably going to be down a little bit from the first-quarter level," Slaymaker said. "Another area (of weakness) would be processors, which are running weak for the quarter."

At the same time, TI is seeing growth in its analog chip business, which Slaymaker said would grow both sequentially and year over year. Certain types of digital signal processors and microcontrollers also are seeing similar growth.

Shares of the company declined less than 1 percent in extended trade on Monday to $31.15. In regular trade, they added 9 cents to $31.33 on the New York Stock Exchange.

Before the mid-quarter update, analysts had, on average, expected net earnings of 46 cents per share on revenue of $3.38 billion, according to Reuters Estimates.

On April 21, the company had said its guidance for the current second quarter was due to customer caution across the board and had also noted that 3G growth was slower.

The Dallas-based company said on Monday it expected semiconductor revenue in the quarter of $3.17 billion to $3.28 billion, compared with the previous forecast of $3.08 billion to $3.32 billion.

Shares of TI, which earns about 35 percent of its revenue from phone chips and about 40 percent from analog chips used in many electronics products, have rebounded since April as investors had bet that analog demand was holding up. (Reporting by Duncan Martell, with additional reporting by Sinead Carew in New York; Editing by Richard Chang and Braden Reddall)