SAN JOSE, Calif. Citing strong growth for its digital signal processor (DSP) products, Texas Instruments Inc. reported revenue of $3.239 billion for the second quarter, up 9 percent sequentially and about even with the year-ago quarter.
TI (Dallas, Texas) posted a profit of $628 million, or $0.38 a share, for the quarter, compared to $411 million, or $0.24 a share, in the previous quarter, and $441 million, or $0.25 a share, a year ago.
The company recorded a net benefit of $0.06 from tax-related items. The company beat Wall Street’s expectations. It was supposed to earn $0.29 a share, according to analysts.
In Q2, semiconductor revenue of $2.765 billion increased $168 million sequentially, or 6 percent, due to strong growth in demand for the company's analog and DSP products. Compared with a year ago, revenue was about even as higher demand for DSP products offset declines in other product areas.
Operating profit in semiconductors was $594 million, or 21.5 percent of revenue, up $134 million sequentially primarily due to higher gross profit. Compared with a year ago, operating profit increased $68 million due to a combination of lower operating expenses and higher gross profit.
“Our strong growth underscores the importance of DSP and analog to a wide range of electronics equipment," said Rich Templeton, TI president and chief executive, in a statement.
"We're also encouraged that the inventory correction that affected our DLP product revenue in the first half of the year is now complete. DLP revenue grew 10 percent sequentially, and we expect it will contribute to growth again in the third quarter," he said. "High-performance analog turned in another strong quarter with 13 percent sequential growth. DSP revenue grew 8 percent sequentially driven by strong growth in wireless applications. Total revenue from the wireless market increased 8 percent as a result of our leading position in the fast-growing 3G market.”
For the third quarter of 2005, TI expects revenue to be $3.290-to-$3.560 billion. Of that, the company’s semiconductor sales are projected to be $2.835-to-$3.065 billion.
TI expects EPS to be in the range of $0.31 to $0.35. For 2005, TI continues to expect capital expenditures to be about $1.3 billion.