Texas Instruments reported lower profits and revenues than expected as it became the first major chipmaker to report the effect of the Japan earthquake on earnings.
Two of TI’s three Japanese factories were damaged in the disaster and it warned on Monday that the biggest impact on revenues would take place in the second quarter.
“We will only be operating with partial output at our factories there,” said Ron Slaymaker, head of investor relations, on an analyst conference call. “Our Japanese customers are still in the early stages of restarting their own factories and we and our customers may face potential supply-chain disruption.”
The Dallas-based company reported first-quarter revenues of $3.39bn and profits of $666m, or 55 cents per share, after the market closed. This was below Wall Street expectations of profits of 58 cents a share on revenues of $3.40bn. TI shares fell 2.4 per cent to $33.95 in New York in after-hours trading.
TI said both the quake and weaker demand for its wireless baseband chips used in mobile phones had hit sales, although new orders were strong.
“We expect growth in the second quarter, though it will be pressured by the situation in Japan,” said Rich Templeton, TI chief executive. “Provided consumer and enterprise demand remain strong, we expect a good second half of the year.”
TI earlier this month announced its biggest acquisition in more than a decade, a $6.5bn all-cash deal for Silicon Valley’s National Semiconductor.
The world’s biggest chipmaker, Intel, reports first-quarter earnings on Tuesday, followed by Qualcomm and Freescale on Wednesday and Advanced Micro Devices on Thursday.