SAN JOSE, Calif.--Texas Instruments Inc. Monday (April 22) reported first quarter sales and profit that were in line with analysts' expectations, even as the firm said customers continue to operate with very low levels of inventory.
TI (Dallas) reported first quarter sales of $2.89 billion, down 3 percent from the previous quarter and down 8 percent from the first quarter of 2012. The company reported a net income for the quarter of $362 million, or 32 cents per share, up 37 percent from the previous quarter and up 45 percent compared with the first quarter of 2012.
TI said revenue from analog and embedded processing made up 77 percent of the firm's total revenue in the first quarter, up from 72 percent in the first quarter of 2012.
"Our revenue and earnings ended the quarter at the high end of our expected range," said Rich Templeton, TI's president and CEO, in a statement.
Templeton said customers continue to operate in real-time mode, maintaining lean component inventories and ordering parts as needed. "Our short product lead times, well-positioned inventory and ready manufacturing capacity allow us to respond rapidly to changes in demand," Templeton said.
TI said it expects second quarter sales to increase to between $2.93 billion and $3.17 billion. The company expects earnings per share for the second quarter to be between 37 and 45 cents.
Christopher Rolland, an analyst with FBR Capital Markets, said in a report circulated Tuesday (April 23) that TI's first quarter sales and second quarter sales target slightly exceeded expectations. More importantly, Rolland said, TI demonstrated better-than-expected gross margin leverage—first quarter gross margin of 47.6 percent—and cost savings from its wireless restructuring.
"Interestingly, the company also stated that sales into the industrial end market were recovering nicely, a data point contrary to commentary we have heard from others reporting this season," Rolland wrote.
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