TI Reports 2Q 2013 Results

Texas Instruments Inc. (TI) reported second-quarter revenue of $3.05 billion, net income of $660 million and earnings per share of 58 cents. Results include a gain associated with the transfer of wireless connectivity technology to a customer and higher-than-expected charges associated with previously announced restructuring.

“Our revenue ended the quarter as expected, up 6% sequentially,” Rich Templeton, TI’s chairman, president and CEO, said. “Excluding legacy wireless, revenue grew 8%; our positions in industrial and automotive markets were important contributors to the sequential growth in revenue. Additionally, backlog increased, and with it, visibility into the second half improved.

“Analog and Embedded Processing are now 78% of revenue, 6 points higher than a year ago,” Templeton added. “Our legacy wireless products declined to less than 5% of revenue and should be below 2% in the third quarter. Silicon Valley Analog (formerly National Semiconductor) led our Analog growth and is gaining share, one year ahead of plan.

“Our business model continues to generate strong cash flow from operations,” he added. “Free cash flow for the trailing 12 months was almost $3 billion, up 10% compared with a year ago. Free cash flow comprised 24% of revenue, which is consistent with our target of 20-25%. We returned $1.0 billion to shareholders through dividends and stock repurchases in the second quarter. For the trailing 12 months, the return to shareholders totaled $3.6 billion, or 123% of free cash flow. Our strategy to return to shareholders all of our free cash flow not needed for debt repayment reflects our confidence in the long-term sustainability of our Analog and Embedded Processing business model.”