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TI reports financial results for 4Q09 and 2009

(PresseBox) (Dallas, ) Texas Instruments Incorporated (TI) (NYSE: TXN) today announced fourthquarter revenue of $3.00 billion, net income of $655 million and earnings per share (EPS) of $0.52.

"TI's growth and improving performance reflect our focus on Analog and Embedded Processing. These are large, diverse businesses that give us access to the world's fastestgrowing electronics markets," said Rich Templeton, TI chairman, president and chief executive officer.

"In the fourth quarter, demand was strong across end markets without the usual holiday slowdown. Throughout, we believe customer and channel inventories have been lean. With demand continuing to be solid and inventories well below historical levels, our outlook for the first quarter reflects the likelihood of sequential growth instead of the typical seasonal decline.

"We continue to make investments to support customers and drive growth, including the rampup of the industry's first 300millimeter analog factory in Richardson, Texas," Templeton concluded.

4Q09 financial summary

TI's operating profit increased compared with the fourth quarter of 2008 and the prior quarter primarily due to higher gross profit, which included the impact of higher revenue and the benefit associated with higher utilization of manufacturing assets. In addition, restructuring charges were lower compared with a year ago.

4Q09 additional financial information

Net income included $16 million in discrete tax benefits. Orders were $3.26 billion, up 75 percent from a year ago and up 5 percent from the prior quarter. Inventory was $1.20 billion at the end of the quarter, down $173 million from a year ago and up $86 million from the prior quarter. Capital expenditures were $436 million in the quarter compared with $76 million a year ago and $226 million in the prior quarter. Capital expenditures in the quarter included the purchase of 300millimeter wafer manufacturing equipment as part of Qimonda AG's bankruptcy proceedings, as well as additional assembly/test manufacturing equipment. The company used $351 million in the quarter to repurchase 14.8 million shares of its common stock and paid dividends of $149 million.

Year 2009 financial summary

TI's operating profit decreased 18 percent in 2009 due to lower revenue. The impact of lower revenue was partially offset by reductions in operating expenses. Operating profit included the negative impact of $212 million in restructuring charges, which were down $42 million from 2008.

2009 additional financial information

Capital expenditures were $753 million in 2009, down $10 million from 2008. The company used $954 million to repurchase 45.3 million shares of its common stock and paid dividends of $567 million.


For the first quarter of 2010, TI expects:

- Revenue: $2.95 - 3.19 billion
- Earnings per share: $0.44 - 0.52

TI will update its firstquarter outlook on March 8, 2010.

For the full year of 2010, TI expects approximately the following:

- R&D expense: $1.5 billion
- Capital expenditures: $0.9 billion
- Depreciation: $0.9 billion
- Annual effective tax rate: 31%

The tax rate estimate is based on current tax law and does not assume reinstatement of the federal R&D tax credit, which expired at the end of 2009.

Safe Harbor Statement

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:

This release includes forwardlooking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forwardlooking statements generally can be identified by phrases such as TI or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe the Company's business strategy, outlook, objectives, plans, intentions or goals also are forwardlooking statements. All such forwardlooking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forwardlooking statements.

We urge you to carefully consider the following important factors that could cause actual results to differ materially from the expectations of TI or its management:

- Market demand for semiconductors, particularly in key markets such as communications, entertainment electronics and computing;
- TI's ability to maintain or improve profit margins, including its ability to utilize its manufacturing facilities at sufficient levels to cover its fixed operating costs, in an intensely competitive and cyclical industry;
- TI's ability to develop, manufacture and market innovative products in a rapidly changing technological environment;
- TI's ability to compete in products and prices in an intensely competitive industry;
- TI's ability to maintain and enforce a strong intellectual property portfolio and obtain needed licenses from third parties;
- Expiration of license agreements between TI and its patent licensees, and market conditions reducing royalty payments to TI;
- Economic, social and political conditions in the countries in which TI, its customers or its suppliers operate, including security risks, health conditions, possible disruptions in transportation networks and fluctuations in foreign currency exchange rates;
- Natural events such as severe weather and earthquakes in the locations in which TI, its customers or its suppliers operate;
- Availability and cost of raw materials, utilities, manufacturing equipment, thirdparty manufacturing services and manufacturing technology;
- Changes in the tax rate applicable to TI as the result of changes in tax law, the jurisdictions in which profits are determined to be earned and taxed, the outcome of tax audits and the ability to realize deferred tax assets;
- Changes in laws and regulations to which TI or its suppliers are or may become subject, such as those imposing fees or reporting or substitution costs relating to the discharge of emissions into the environment or the use of certain raw materials in our manufacturing processes;
- Losses or curtailments of purchases from key customers and the timing and amount of distributor and other customer inventory adjustments;
- Customer demand that differs from our forecasts;
- The financial impact of inadequate or excess TI inventory that results from demand that differs from projections;
- The ability of TI and its customers and suppliers to access their bank accounts and lines of credit or otherwise access the capital markets;
- Product liability or warranty claims, claims based on epidemic or delivery failure or recalls by TI customers for a product containing a TI part;
- TI's ability to recruit and retain skilled personnel; and
- Timely implementation of new manufacturing technologies, installation of manufacturing equipment and the ability to obtain needed thirdparty foundry and assembly/test subcontract services.

For a more detailed discussion of these factors, see the Risk Factors discussion in Item 1A of the Company's most recent Form 10-K. The forwardlooking statements included in this release are made only as of the date of this release, and the Company undertakes no obligation to update the forwardlooking statements to reflect subsequent events or circumstances.

Texas Instruments Deutschland GmbH

Texas Instruments (NYSE: TXN) helps customers solve problems and develop new electronics that make the world smarter, healthier, safer, greener and more fun. A global semiconductor company, TI innovates through design, sales and manufacturing operations in more than 30 countries. For more information, go to

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