Texas Instruments 2Q down on weak wireless sales

The company also said overall demand from distributors fell unexpectedly in June as they reduced their inventory levels, partially because of "a weaker economic environment." TI's chairman and CEO, Rich Templeton, also suggested customers also had "greater confidence in TI's ability to deliver products within short lead times."

The company's largest division, which makes analog chips, continued to grow. Its output is used in a wide variety of industrial products and consumer gadgets such as digital cameras and music players.

The other thriving division makes chips that are "embedded" into cars and other industrial products.

TI said it expects third-quarter earnings of 41 cents per share to 47 cents per share on sales of $3.26 billion to $3.54 billion, below the Thomson Financial estimates of 51 cents per share and $3.56 billion, respectively.