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Texas Instruments(TXN - Get Report) Chief Financial Officer Kevin March says that investors should not be overly concerned about the uncertain macroeconomic environment, which weighed on the company's
second-quarter results this week.
"Concern, I think, is too strong a word," he told
TheStreet, during an interview. "What we have is an economy that's growing, both domestically and internationally, but that's growing at a slower pace than most people would prefer to see at this stage in the cycle."
The CFO acknowledged the European headwinds
identified by other tech heavyweights such as
Intel(INTC - Get Report), as well as a slight slowdown in China, but warned investors not to panic.
"It's not like we're heading for a global decline or anything," he said. "I think that the important thing is that we're still growing, and we're likely to grow."
March explained that Texas Instruments' revenue grew 7% between the first and second quarters. "[For] revenue patterns, our low point was in the first quarter," said the CFO, who called a
bottom in the IT spending slowdown earlier this year.
Texas Instruments' second-quarter profit topped both its own and Wall Street's
expectations after market close on Monday. Investors, however, focused on the company's weak guidance, pushing its stock down less than 1% to $26.61 in afternoon trades.
The chip maker noted its customers are cautious about placing new orders.
"Based on our analysis, customers are holding very lean levels of inventory," said March. "They have given us normal visibility for July and August, but the visibility in September is less than they would normally give us."
The CFO explained that this may be the result of low end demand or the fact that Texas Instruments can quickly meet customer requirements.
"We have built up our inventory a fair amount over the last three quarters or so," he said. "The lead time on most of our products is six weeks or less - typically, we target in the six to eight weeks kind of range."