Texas Instruments Inc. reported a three percent rise in first-quarter revenue due to strong growth in its analog chip business and improved demand for its chips used in cars, appliances, computers and industrial products. The company also forecast second-quarter revenue largely above analysts’ average estimate, sending its shares up 3.7%.
Share of Texas Instruments, also called TI, is exiting its low-margin mobile chips business to focus on its more profitable analog business, which makes chips for everything from automotive safety devices to electronics. Excluding revenue from its wireless business, which the company is winding up, TI said revenue grew 11% in the quarter ended March 31.
The company got about 62% of its total revenue from the analog semiconductor industry during the quarter. TI forecast earnings of 55 cents to 63 cents per share on revenue of US$3.14 billion to $3.40 billion (US dollars) for the second quarter.
On average, analysts were expecting a profit of 52 cents per share on revenue of $3.15 billion, according to Thomson Reuters I/B/E/S. TI is also in the middle of a restructuring plan to cut costs in its embedded-processing division and in less profitable markets.
The company said in January that it would cut 1,100 jobs in the US, Japan and India, or about 3% of its global workforce, in a restructuring initiative aimed at saving $130 million by the end of this year.
The company’s net income rose to $487 million, or 44 cents per share, in the quarter ended March 31 from $362 million, or 32 cents per share, a year earlier. TI said its first-quarter results included a gain of $37 million, or 2 cents per share, from sales of a site and other assets associated with its restructuring plan.
TI shares closed at $46.46 on the Nasdaq and the stock had risen about 6% this year.
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