As Texas Instruments predicted, auto chip sales are the only bright spot and stocks are quiet

As Texas Instruments predicted, auto chip sales are the only bright spot and stocks are quiet
As Texas Instruments predicted, auto chip sales are the only bright spot and stocks are quiet

A previous version of this report incorrectly stated FactSet’s estimates for fourth-quarter earnings.

Shares of Texas Instruments Inc. were relatively calm in Tuesday’s extended session after the analog chipmaker’s earnings beat low expectations and offered an outlook that thwarted analysts’ expectations.

Texas Instruments TXN Stock,
-0.63%
fell 1% in after-hours trading, after falling 0.7% in the regular session to close at $177.04, and falling 0.7% in the PHLX Semiconductor Index SOX-index,
-0.72%
and an almost flat S&P 500 SPX index,
-0.07%.

For the fourth quarter, the company reported net income of $1.96 billion, or $2.13 per share, compared with $2.14 billion, or $2.27 per share, a year ago.

Revenue fell to $4.76 billion from $4.83 billion in the year-ago quarter, the company said.

Analysts polled by FactSet had estimated earnings of $1.98 per share on revenue of $4.61 billion.

Read: The PC Industry Just Suffered Its Worst Drop Ever, Again

Last quarter, it looked like auto chip sales had become the sole growth driver for the analog chip segment, after the company focused on building its long-term capabilities amid a weak profit outlook. in the fourth trimester.

And it came to fruition, as Rich Templeton, president and CEO of Texas Instruments, summed up in a press release.

“As we expected, our results reflect weaker demand in all end markets except automotive,” Templeton said.

Read: PC market sees ‘biggest’ fall since data collection began in mid-1990s, analysts say

The company expects first-quarter earnings of $1.64 to $1.90 per share on revenue of $4.17 billion to $4.53 billion, while analysts polled by FactSet expected in average earnings of $1.86 per share on revenue of $4.41 billion. The company reported first-quarter earnings of $2.35 per share on revenue of $4.91 billion in 2022.

Unlike companies like Nvidia Corp. NVDA,
+0.38%
and Advanced Micro Devices Inc. AMD,
-2.39%,
Texas Instruments operates its own fabs.

Texas Instruments still ranks among the best performing chip stocks over the past 12 months with a 1% loss, compared to a 16.3% drop in the SOX chip index and an 8.9% drop in the S&P500.

Read: Intel’s revenue will be more forward-looking than the past

Manufacturer of chip manufacturing equipment Lam Research Corp. LRCX,
-0.67%
is due to report earnings on Wednesday after the bell, and then Thursday comes KLA Corp. KLAC,
-0.57%
and Intel Corp. INTC,
-1.16%
after market close.

. Texas Instruments predicted auto chip sales bright spot stocks quiet

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