A chill hits Texas InstrumentsJuly 21, 2008: 5:19 PM ET
By Scott Moritz
Texas Instruments (TXN) came up light in its second quarter and guided down for the third quarter.
The Dallas-based semiconductor shop reported adjusted earnings of 44 cents a share, compared to 42 cents a year ago, but the bottom line missed analysts'expectations for 46 cents a share in profit for the second quarter.
Sales were $3.35 billion in the quarter, down from $3.42 billion in a year ago and under the $3.39 billion top line analyts were looking for.
The company said "demand slowed unexpectedly in June" as distributors cut inventory. The company also said the first-quarter slowdown in wireless continued in the second quarter. Texas Instruments is one of the largest suppliers of wireless chips in the world and the top chip supplier to Nokia (NOK).
"We believe this slower demand was due to a mix of reasons, including a weaker economic environment and greater confidence in TI's ability to deliver products within short lead times," CEO Rich Templeton said in a press release.
Looking ahead, TI guided third-quarter numbers below Wall Street estimates. The chip giant expects earnings in the range of 41 cents a share to 47 cents a share. The company expects sales in the third quarter to be around $3.26 billion to $3.54 billion. Analysts expected a 51-cent profit on $3.56 billion in the third quarter
On a somewhat positive note, TI says it saw mixed signals in the downturn. "Our orders were up in the quarter and backlog grew, but we are cautious given the demand environment we just experienced. If demand strengthens as quickly as it slowed, we are well-positioned to meet it."