News

Texas Instruments (TI) has announced an expected second-quarter sales revenue of up to $3.95 billion, surpassing analysts' projections of $3.78 billion. The company anticipates earnings per share of $1.05 to $1.25, which exceeds analysts' expectations of $1.17.

TI's positive outlook, combined with increasing consumer electronics demand, indicates that adjustments in analog chip inventory may be easing and the decline in industrial and automotive components demand may be stabilizing.

Summit Insights analyst Kinngai Chan noted, "Investors are looking for signs of demand recovery or completion of channel inventory adjustments. TI's forecast aligns with their expectations."

TI's chips play a vital role in powering electronic devices and enabling communication between digital processors and the physical world.

Counterpoint Research reports a 3% increase in global personal computer shipments in the first three months of 2024, following eight consecutive quarters of decline.

Kinngai Chan stated that while sales in the analog industry may continue to decrease, it could experience more typical seasonal demand patterns in the coming quarters.

TI's largest segment—industrial equipment manufacturers—has largely completed inventory reduction, though some businesses are still in the process. CFO Rafael Lizardi mentioned that this can lead to uneven demand recovery.

TI will maintain its policy of refraining from providing extensive forecasts for future demand.

In the first quarter, TI's revenue declined by 16% to $3.66 billion, its lowest level since 2020.

As the world's largest manufacturer of analog semiconductors and embedded processors, TI has a broad customer base across industries, serving as an economic barometer for sectors such as aerospace hardware and consumer electronics.

While analog chips typically require less advanced production technology compared to digital products, TI has initiated an ambitious plan to modernize its manufacturing facilities. As part of this effort, the company will significantly reduce outsourced production.

By 2026, TI plans to invest approximately $5 billion annually in new factories and equipment, which will affect profitability.