* Q4 earnings per share $0.23 vs year-ago $0.25
* Q4 revenue $2.98 bln vs Street view $2.95 bln
* CFO says customers delay orders due to macroeconomic
* TI shares fall slightly in late trade
By Sinead Carew
Jan 22 Texas Instruments Inc posted
quarterly revenue that was ahead of Wall Street expectations but
the chip maker warned of uncertain demand and a widespread
customer reluctance to order until the last minute due to
TI, which makes chips for everything from industrial
equipment to cars, said on Tuesday that while orders appeared to
be following a normal pace for this time of year, customers were
still worried about increasing their inventory of chips.
Chief Financial Officer Kevin March told Reuters that
quarterly revenue was at the high end of TI's expected range
because customers had made some orders late in the quarter.
But he said that weakness in European economies and in China
as well as uncertainty about government policies in the United
States were making customers wary of ordering too many chips.
"You've got the lingering uncertainty in Europe. You've got
the slowdown in China that seems to be reversing itself now and
you've got the (U.S.) fiscal cliff taking up all the headlines,"
March told Reuters. "Combined, it's got everybody really
conservative right now and not willing to go out on a limb."
On top of this, the company's previously announced wind down
of its cellphone chip business will cut revenue much more than
it otherwise would have fallen in the first quarter, March said.
Even though January order trends are looking better than
December's, executives told analysts on a conference call that
it was too soon to estimate when the market might recover.
Since customers are still ordering at the last minute,
Bernstein analyst Stacy Rasgon said it would be hard for TI to
predict the timing for a turnaround.
"The signs look like they're slowly improving," he said.
TI said its fourth-quarter profit fell to $264 million or 23
cents per share compared with $298 million or 25 cents per share
in the year-ago quarter. Revenue fell to $2.98 billion from
$3.42 billion but was ahead of Wall Street expectations for
$2.95 billion according to Thomson Reuters I/B/E/S.
For the first quarter the company warned that revenue could
decline further as it forecast a range of $2.69 billion to $2.91
billion. This is expected to include a $135 million decline from
the wireless business.
"If the weakness in revenue is more wireless than the core
business that's a good thing," said Bernstein's Rasgon.
TI had said in November that it was eliminating 1,700 jobs
as it is winding down its smartphone and tablet chip business
due to stiff competition from rivals such as Qualcomm Inc
Instead TI is focusing on analog chips and embedded chips
that are used in a wide range of products.
TI forecast earnings per share in a range of 24 cents to 32
cents for the current quarter. This include a charge of 6 cents
related to restructuring and acquisition and a tax benefit of 6
cents related to a credit for research and development.
On Dec. 10 the company had forecast fourth-quarter revenue
of $2.89 billion to $3.01 billion and earnings per share of 5
cents to 9 cents, including 21 cents per share of charges from
its previously announced restructuring of its wireless business.
TI shares fell slightly to $33.35 in late trade after
closing at $33.46 in the regular Nasdaq session.