Texas Instruments Inc, the largest maker of analog chips, gave an updated fourth-quarter sales forecast that was in line with analysts’ estimates as customers seek to keep inventory low amid lackluster demand.
Sales will be US$2.89 billion to US$3.01 billion, the Dallas-based company said on Monday in a statement. Analysts on average projected revenue of US$2.95 billion, according to data compiled by Bloomberg. In October, Texas Instruments had said sales would be US$2.83 billion to US$3.07 billion.
Texas Instruments is one of the few technology companies that still issue quarterly updates. The breadth of its customer list — ranging from home-appliance makers to manufacturers of space hardware — makes its forecasts an indicator of demand across industries.
Texas Instruments shares climbed as high as US$30.35 in extended trading following the announcement. They had earlier dropped less than 1 percent to US$29.82 at Monday’s close in New York, leaving the stock up 2.4 percent this year.
Low inventory levels “reflect economic uncertainty and relatively weak demand,” Texas Instruments vice president Ron Slaymaker said on a conference call with analysts. “In general we’re shipping consistent with demand, and inventory levels are low.”
Any increases in demand will force customers to boost buying to replenish their stockpiles, Slaymaker said.
The computing, communications and industrial markets continue to be weak, he said. Consumer markets are mixed, with television makers cutting back on orders, while game consoles and e-book readers are seeing higher demand, Slaymaker said.
Earnings this quarter will be US$0.05 to US$0.09 a share, including a charge of US$0.21 related to a restructuring of the wireless business, the company said. That is down from an earlier company forecast of US$0.23 to US$0.31 a share.