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Texas Instruments, the second largest US chipmaker, provided some good news for the semiconductor and mobile phone industries on Monday, reporting strong growth in sales of wireless chips.

TI, the biggest maker of chips for cellphones, met analysts’ second-quarter expectations of earnings of 47 cents a share or $739m from continuing operations and revenues of $3.7bn. Revenues were up by 24 per cent on a year earlier and profits up 34 per cent.

Its shares rose 3.6 per cent in after-hours trading to $28.85 as its outlook also matched Wall Street’s expectations.

It scotched fears of a slowdown in the cellphone market with predictions of seasonal growth in its third quarter and revenues of $3.63bn to $3.95bn and earnings per share of 42 to 48 cents.

Rich Templeton, chief executive, described it as another excellent quarter.

“All regions of the world showed strong revenue growth from a year ago,” he said.

“Revenue from our wireless semiconductors grew 27 per cent, including more than 70 per cent growth in 3G.

“Going into the third quarter, our backlog of orders is up and our outlook is for seasonal growth.”

Sales of TI’s high-performance analogue semiconductors grew 32 per cent and it reported more operators were adopting GSM cellphone technologies rather than CDMA. TI is the leading GSM chip vendor, while its US rival Qualcomm licenses and manufactures CDMA chips.

Ron Slaymaker, TI vice president, told analysts its results had been helped by the performance of three of its biggest customers – Nokia, Motorola and Sony Ericsson – who had reported strong revenue growth from handset sales.

TI also makes chips for its patented Digital Light Processing (DLP) technology for digital TVs and reported revenues grew 34 per cent on a year earlier.

Overall orders going forward were worth $3.91bn, up $302m on the previous quarter.

Semiconductors make up the bulk of TI’s business, accounting for $3.5bn of revenues in the second quarter. Its calculator business recorded sales of $192m, up from $74m in the previous quarter as retailers began to stock up for the back-to-school season. Revenues from the Sensors and Control division were excluded from the figures after its sale on April 27.

Copyright The Financial Times Limited 2017. All rights reserved.
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