can't seem to get around that pesky telecommunications chip glut.
The maker of semiconductors for cell phones projected Monday that third-quarter revenue would fall 10% to 15% from second-quarter levels, resulting in a loss of a few cents a share. Wall Street had been expecting the company to earn 4 cents a share on flattish revenue for the third quarter.
The weaker-than-expected forecast comes on the back of the standard declines in reported earnings and revenue. For its second quarter, Texas Instruments rang up a 19% sequential decline to revenues, to $2.04 billion, and an 83% decline in earnings, to 3 cents a share. Both numbers, however, beat Wall Street estimates. From a year ago, revenue fell 31% and earnings dropped 90%.
Still, the company maintained a brave face. TI President and Chief Executive Tom Engibous said in a statement that the decline in order rates is slowing and that semiconductor revenues are nearing the bottom. "The downturn isn't over, but we are beginning to shift our focus to recovery and growth," he said. Previously, TI has been mum on the subject of a bottom in semiconductor spending, saying it lacked the visibility to predict ordering trends.
While the company said it continues to trim operating expenses, it stuck by its plans for $1.8 billion in 2001 capital spending. As part of its cost-saving measures, TI took $252 million in charges to cover the costs of severance and closing three plants, two in California and one in New Hampshire. Including these charges, TI was in the red, losing 11 cents a share.
After falling 71 cents to $30.80 during regular trading Monday, Texas Instruments fell 24 cents after hours on Island to $30.56.