Texas Instruments (NASDAQ:TXN) is a Dallas-based company that designs, manufactures, and sells semiconductors to electronics designers and manufacturers in the United States and around the world. Shares of Texas Instruments have jumped 7.71% week-over-week as of early afternoon trading on Wednesday, April 24, 2024. The stock has surged into positive value territory on the back of this post-earnings bump. Why did the company’s earnings lead to this surge? Let’s jump in.
This company released its first quarter fiscal 2024 earnings on Tuesday, April 23, 2024. Texas Instruments reported revenues of $3.66 billion in Q1 FY2024 – down 16% compared to $4.37 billion in the first quarter of fiscal 2023. Moreover, operating profit dropped 34% year-over-year to $1.28 billion. The company reported net income of $1.10 billion or $1.20 per share – down 35% from $1.70 billion or $1.85 per share in the prior year.
Beyond those core metrics, Texas Instruments’ President and CEO Haviv Ilan added that “Over the past 12 months we invested $3.7 billion in R&D and SG&A, invested $5.3 billion in capital expenditures and returned $4.8 billion to owners.” He added; “TI’s second quarter outlook is for revenue in the range of $3.65 billion to $3.95 billion and earnings per share between $1.05 and $1.25. We continue to expect our effective tax rate to be about 13%.”
Shares of Texas Instruments currently possess a solid price-to-earnings ratio of 27. That puts the stock in favourable value territory compared to its industry competitors. This company is well-positioned to benefit from the US push for more domestic semiconductor manufacturing. Texas Instruments is a legacy manufacturer in that space, and could see a resurgence along with US manufacturing.
