Texas Instruments Incorporated (NASDAQ:TXN) reported upbeat earnings for its third quarter. The company issued weak fourth-quarter sales guidance.
The Dallas-based electronics maker posted third-quarter revenue of $3.77 billion, net income of $1.43 billion and earnings per share of $1.49. Earnings per share include a nine-cent benefit for items that were not in the company's original guidance.
"In our core businesses,” quoting from Wednesday’s press release, "Analog revenue declined 8% and Embedded Processing declined 19% from the same quarter a year ago.
"Our cash flow from operations of $7.0 billion for the trailing 12 months again underscored the strength of our business model. Free cash flow for the trailing 12 months was $6.0 billion and 41% of revenue. This reflects the quality of our product portfolio, as well as the efficiency of our manufacturing strategy, including the benefit of 300-millimeter Analog production."
TI's fourth quarter outlook is for revenue in the range of $3.07 billion to $3.33 billion, and earnings per share between $0.91 and $1.09, which includes an estimated $5 million discrete tax benefit.
"We continue," the release concluded, "to expect our annual operating tax rate to be about 16% in 2019."
TI asked investors to consider the following factors, among them, market demand for semiconductors, particularly in our end markets; the company’s ability to compete in products and prices in an intensely competitive industry; and customer demand that differs from forecasts and the financial impact of inadequate or excess company inventory that results from demand that differs from projections.
Shares tumbled $10.77, or 8.4%, to $117.80
