Revenue down 30%, cuts approx. 3400 jobs
Chip maker Texas Instruments has reported an 86% decline in net income to $107m for the fourth quarter 2008, compared to $753m in the year-ago quarter, on revenue down 30% at $2.49 billion.
Operating income fell 95% to $51m compared to $996m in the year-ago quarter, while diluted EPS declined 85% to $0.08. It repurchased 20.3 million shares of common stock for $386m and paid dividends of $141m.
Analog revenue fell 22% to $1.01 billion, while embedded processing revenue fell 21% to $340m. Wireless revenue fell 42% to $646m, while revenue from others fell 30% to $490m.
For fiscal 2008, the company reported a 27% decline in net income to $1.92 billion compared to $2.64 billion a year ago, on revenue down 10% at $12.5 billion.
The company also announced plans to cut approximately 3,400 jobs, a move for which it expects to incur charges of about $300m. This, along with a plan announced in October, is expected to save $700m a year after all reductions are complete in the third quarter of 2009.
Rich Templeton, chairman, president, and chief executive at TI, said: We are realigning our expenses with a global economy that continues to weaken. Most of the reductions will come in our internal support functions and non-core product lines so that a greater percentage of the dollars we spend will go directly toward developing and supporting analog and embedded processing products. We believe these are the areas that will drive TI’s future growth and allow us to achieve our financial objectives. We are not counting on a near-term economic rebound for improvement.
Looking ahead to the first quarter 2009, the company expects revenue of between $1.62 billion to $2.12 billion and diluted EPS ranging from a loss of $0.11 a share to a profit of $0.03 a share.