Texas Instruments Inc (TXN) Q3 2024 Earnings Call Highlights: Navigating Market Challenges with ...

GuruFocus News
4 min read

In This Article:

  • Revenue: $4.2 billion, up 9% sequentially, down 8% year-over-year.

  • Analog Revenue: Declined 4% year-over-year.

  • Embedded Processing Revenue: Declined 27% year-over-year.

  • Gross Profit: $2.5 billion, 60% of revenue.

  • Gross Profit Margin: Increased 180 basis points sequentially.

  • Operating Expenses: $920 million, flat from a year ago.

  • Operating Profit: $1.6 billion, 37% of revenue, down 18% year-over-year.

  • Net Income: $1.4 billion, $1.47 per share.

  • Cash Flow from Operations: $1.7 billion in the quarter, $6.2 billion trailing 12-month basis.

  • Capital Expenditures: $1.3 billion in the quarter, $4.8 billion trailing 12-month basis.

  • Free Cash Flow: $1.5 billion trailing 12-month basis.

  • Dividends Paid: $1.2 billion in the quarter.

  • Stock Repurchases: $380 million in the quarter.

  • Cash and Short-term Investments: $8.8 billion at the end of the third quarter.

  • Total Debt Outstanding: $14 billion, with a weighted average coupon of 3.8%.

  • Inventory: $4.3 billion, up $190 million from the prior quarter.

  • Fourth Quarter Revenue Guidance: $3.7 billion to $4 billion.

  • Fourth Quarter EPS Guidance: $1.07 to $1.29.

Release Date: October 22, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Texas Instruments Inc (NASDAQ:TXN) reported third-quarter revenue of $4.2 billion, which was in line with expectations and represented a 9% sequential increase.

  • The automotive market showed strong growth, particularly in China, with revenue increasing by upper single digits.

  • Personal electronics, enterprise systems, and communication equipment markets experienced significant sequential growth, indicating a cyclical recovery.

  • The company announced a 5% increase in dividends, marking the 21st consecutive year of dividend increases, reflecting a commitment to returning free cash flow to shareholders.

  • Texas Instruments Inc (NASDAQ:TXN) maintains a strong balance sheet with $8.8 billion in cash and short-term investments, supporting its financial stability and future investments.

Negative Points

  • Year-over-year revenue declined by 8%, with analog revenue down 4% and embedded processing down 27%, indicating challenges in these segments.

  • The industrial market experienced a decline as customers continued to reduce inventory levels, impacting overall performance.

  • Operating profit decreased by 18% from the year-ago quarter, reflecting pressure on profitability.

  • Inventory levels increased to $4.3 billion, raising concerns about potential overstocking amid uncertain demand.

  • Guidance for the fourth quarter indicates a potential revenue decline, with expectations set between $3.7 billion to $4 billion, suggesting continued market challenges.

Recommended Stories