Texas Instruments Inc. (NYSE: TXN) lowered guidance at its mid-quarter update.  We expected this, but the magnitude here for companies reporting data later this quarter is getting worse than those which gave guidance back in October or earlier in November.  TI now expects revenues of $2.3 billion to $2.5 billion with earnings of $0.10 to $0.16.  If you looked at these as quick as we did, you probably did a double-take.

This compared with a previous range of $2.83 to $3.07 billion inrevenues.  But the drop on the earnings side is far worse as its priorrange was $0.30 to $0.36 EPS.  For whatever this is worth, the companydid note at the end of last quarter that its estimates included a $0.05benefit from the reinstatement of the federal research tax credit, andit also included charges of about $0.01 per share associated with thecompany’s restructuring actions in its Wireless business.

Thomson Reuters (First Call) had consensus estimates at $0.31 EPS on$2.91 billion in revenues.  These numbers had also come downsubstantially in the last 90 days when so many companies have beenwarning. 

If the semiconductor business could become a person, Will Rogers would have never said that he never met a man he didn’t like.

It seems that the bad news in chip stocks is nowhere near over.  Sharesclosed at $14.82, and the 52-week trading range is $13.38 to $34.60.  Shares are down close to 5% right around $14.00 after the report in after-hours trading.

Jon C. Ogg
December 8, 2008

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