Texas Instruments Inc has reported profits from continuing operations of $0.44 per share, excluding one-time charges. That net income level was exactly in line with Wall Street expectations. The Dallas-based company posted actual net income of $11m, or $0.03 per share, on revenue down 3.4% at $2.19bn. Charges for the quarter included $219m resulting from the discontinuance of its US-based DRAM manufacturing joint venture with Hitachi Ltd. A further $25m hit to the bottom line came from acquisition charges. The results compare to net income of $129m, or $0.33 per share, in the year-ago quarter – although those figures include $27m ($0.07 per share) in income from discontinued operations. TI says its overall revenue and orders declined year-over-year primarily due to price declines in DRAM chips, something the company has been bemoaning for some time now. Average unit prices for DRAMs plunged 60% year-over-year, leading to an operating loss for memory products of $129m. Overall semiconductor revenues were down 3% from the year-ago quarter but the company points out that excluding memory products semiconductor sales would have increased 7%. Sales in the company’s flagship digital signal processor chip business – which accounted for nearly half of semiconductor revenue – increased 18% from last year but declined 8% from the fourth quarter. TI has changed its tune on the worldwide semiconductor market since January, when it projected 10% growth this year (CI No 3,331). It now says it expects growth of 5% or less, based on inventory reductions in finished electronic equipment, weak sales in Asia and the depreciation of the yen. Thus, the company says, it will see continued pressure on its semiconductor revenues and margins in the second quarter. TI had already admitted in January that falling DRAM prices and the Asian situation would adversely affect first-quarter earnings.
