Texas Instruments Shares Rise After Q1 Earnings

On Wednesday, April 23, 2014, Texas Instruments (NASDAQ: TXN) announced its first quarter earnings.

Shares of the company traded up 2.28 percent or $1.06 per share in after-hours trading to $47.52 after the company hit analysts' expectations.

The company reported revenue grew three percent due to strong growth in it analog chip business and greater demand for its chips. The company now reported revenue of $2.98 billion.

During this quarter, the chip company retained about 62 percent of its revenue from the analog semiconductor business during the quarter.

In addition, back in January the company had said that it would cut 1,100 jobs in the United States, Japan and India, or about three percent of its global workforce, in a restructuring initiative aimed at saving $130 million by the end of this year.

The company also sees its second quarter earnings per share at $0.55 to $0.63 per share. The company also sees revenue of $3.14 billion to $3.40 billion.

Rich Templeton, CEO commented, “We returned $4.2 billion to shareholders in the past twelve months through dividends paid and stock repurchases. Our strategy to return to shareholders all free cash flow not needed for debt repayment, and to return proceeds from exercises of equity compensation, reflects our confidence in the long-term sustainability of our business model. In the past twelve months, we returned 99 percent of this targeted amount.”

Templeton continued, "TI's outlook for the second quarter of 2014 is for revenue in the range of $3.14 billion to $3.40 billion and earnings per share between $0.55 and $0.63. The midpoint of the revenue range would represent 7 percent year-over-year growth, or 13 percent excluding legacy wireless revenue. The annual effective tax rate for 2014 is expected to be about 28 percent, up from our prior estimate of about 27 percent."