Texas Instruments Annual Revenue Bolstered by Analog Business

January 24, 2019 by Scott McMahan

Texas Instruments Incorporated (TI) reported fourth-quarter revenue of $3.72 billion, a net income of $1.24 billion and earnings per share of $1.27. Rich Templeton, TI's chairman, president and CEO, commented, "In our core businesses, Analog revenue grew 4 percent and Embedded Processing declined 12 percent from the same quarter a year ago."

Revenue for the company's Analog business, which is made up of the Power, Signal Chain and High Volume segments, increased due to Signal Chain and Power segments, but the revenue gains were partially offset by a drop in the High Volume business.

The 2018 Annual revenue for the Analog business rose 9% compared to 2017. Again the company cited the growth in the Power and Signal Chain segments as the driver of the increased revenues. This annual increase was also offset by the decline of the High Volume business. The Analog business further posted 14% higher annual operating profits. TI cited the higher revenue and associated gross profit as the reason for the improvement in operating profit. The net income for 2018 increased over 51 percent compared to 2017 from about $3.68 billion to about $5.58 billion

"Our cash flow from operations of $7.2 billion for the year again underscored the strength of our business model. Free cash flow for the year was $6.1 billion and represents 38.4 percent of revenue. This reflects the quality of our product portfolio, as well as the efficiency of our manufacturing strategy, including the benefit of 300-millimeter Analog production."

"We have returned $7.7 billion to owners in 2018 through stock repurchases and dividends. Our strategy is to return all our free cash flow to owners. Over the last 12 months, our dividends represented 42 percent of free cash flow, underscoring their sustainability," Templeton added.

"TI's first-quarter outlook is for revenue in the range of $3.34 billion to $3.62 billion, and earnings per share between $1.03 and $1.21, which includes an estimated $20 million discrete tax benefit. For 2019, TI's annual operating tax rate is expected to be about 16 percent," he concluded.