The company reported third quarter revenues of $4.15 billion and net income of $1.36 billion, ahead of expectations.
While revenue decreased 8% from the same quarter a year ago it increased 9% sequentially, and while revenues fell back that was the smallest decline seen in seven quarters. However, the key industrial segment continued to show weakness with a quarterly decline, while all other end markets showed relatively strong growth.
"Our cash flow from operations of $6.2 billion for the trailing 12 months again underscored the strength of our business model, the quality of our product portfolio and the benefit of 300mm production,” said Haviv Ilan, TI's president and CEO. “Over the past 12 months we invested $3.7 billion in R&D and SG&A, invested $4.8 billion in capital expenditures and returned $5.2 billion to owners.”
The company’s performance was helped by a recovery in orders for its analogue chips across all segments and improving demand from China's automotive market. Sales of semiconductors, which help power electronic devices, have also increased and that’s been helped by orders from smartphone and PC providers.
Revenues from the automotive segment increased and Ilan pointed to stronger growth in China.
"There is momentum for EVs in China, our content is growing there, and that's what really drove the growth in the third quarter," Ilan said. However, he warned that weakness is expected to persist in the remainder of the automotive market.
"Bottom line, TI now sees cyclical recovery in the non-industrial end markets and expects the automotive market to continue to grow, driven by EV adoption in spite of the mixed demand from the non-Chinese auto OEMs," said Summit Insights analyst Kinngai Chan.
Texas Instruments is the first major US chipmaker to report results for the September quarter and is closely watched as it sells into most of the main markets.
The company is forecasting that fourth-quarter revenue and profit will be below estimates due to ongoing weakness in the industrial market. This is because customers are struggling to clear existing inventory.
