Zhitong Finance APP learned that Texas Instruments (TXN.US), which is regarded as a barometer of the semiconductor industry, released its performance guidance in its latest financial report, showing that the future downturn in the global economy and the semiconductor industry is expected to lead to limited market demand. The company expects results for the first quarter of fiscal 2023 to fall short of expectations.
On January 24 (Tuesday), Eastern Time, after the U.S. stock market closed, Texas Instruments announced its financial results for the fourth quarter of fiscal year 2022. The financial report shows that Texas Instruments’ Q4 revenue was US$4.67 billion, exceeding market analysts’ expectations of 1.61%. In the past four quarters, the company’s revenue has exceeded market consensus expectations four times; %; Diluted earnings per share were $2.13, better than analysts’ expectations of $1.96, compared to $2.27 in the same period last year; gross profit was $3.087 billion, compared to $3.35 billion in the same period last year; operating profit was $2.176 billion, compared to the same period last year It was 2.463 billion US dollars. The company will pay a cash dividend of $1.24 per share.
Divided by business, the company’s Q4 analog business revenue was US$3.558 billion, a year-on-year decrease of 5%; embedded processing business revenue was US$837 million, a year-on-year increase of 10%; other business revenue was US$275 million, a year-on-year decrease of 11%.
“Cancellations increased in the fourth quarter,” said Dave Pahl, the company’s director of investor relations. “Demand in the quarter was below seasonal averages as customers preferred to reduce inventory,” CEO Rich Templeton said Tuesday. “The only exception to the weaker demand was the automotive market.”
However, Kinngai Chan, an analyst at Summit Insights Group, pointed out that while orders in the auto market have not yet turned negative, they have started to slow down. “The slowdown in orders was mainly affected by supply chain shortages,” it said.
Texas Instruments said it expects revenue in the next quarter to be in the range of $4.17 billion to $4.53 billion, with the median below the market’s average estimate of $4.41 billion. Earnings per share are expected to be in the range of $1.64 to $1.90, with the median also missing consensus estimates of $1.87. Affected by the news, the company’s share price fell 0.36% to $176.41 after the U.S. stock market closed on Tuesday, after losing 12% of its value in 2022.
Because Texas Instruments has the largest list of customers and products in the chip industry, its earnings report can serve as an indicator of demand across the economy. Rich Templeton, the company’s chief executive, said, “As the company expected, our results reflected weak demand in all end markets except automotive. The company’s annual $8.7 billion once again demonstrated the strength of our business model. This year’s Freedom Cash flow of $5.9 billion, or 30% of revenue, underscores the market advantage of our high-quality product portfolio and efficient product manufacturing strategy (300mm class chip production).”
“Over the last 12 months, the company spent $3.4 billion on R&D (research and development) and SG&A (selling, general and administrative expenses), capital expenditures of $2.8 billion, and returned 100% to shareholders through dividends and share repurchases. $7.9 billion. We expect the annual effective tax rate to be approximately 13% to 14% in 2023.”