Texas Instruments Inc forecast only modest sequential growth in the current quarter as orders were slower than usual for this time of year due to economic concerns in the United States and Europe.
The company, whose chips are found in products ranging from cellphones to cars, cited lukewarm production in computing and consumer electronics as manufacturers are holding off on making products for the back-to-school and year-end holiday shopping seasons.
We're seeing a somewhat more muted outlook from computer customers and consumer areas such as TV and gaming, Chief Financial Officer Kevin March told Reuters. We're not seeing the signals we'd normally see at this time of year.
But the executive said that if demand improves TI will have its factories ready to take advantage of this. He also said the current economic uncertainty may not necessarily mean slow holiday sales.
I don't think we're going to wind up with a Christmas without any gifts under the tree. The (store shelves) may just end up filling later, he said.
TI forecast third-quarter revenue of $3.4 billion to $3.7 billion, compared with the average analyst expectation for $3.6 billion, according to Thomson Reuters I/B/E/S.
It forecast earnings per share for the quarter of 55 cents to 65 cents, a wider than usual guidance range for the company.
This compares with second-quarter earnings of $672 million, or 56 cents per share, compared with $769 million, or 62 cents per share, in the year-ago quarter.
Revenue fell to $3.46 billion from almost $3.5 billion but was slightly ahead of analysts' consensus forecast of $3.44 billion, Thomson Reuters I/B/E/S.
TI shares rose to $31.60 after closing at $31.47 on the New York Stock Exchange as the company's outlook was not as bad as some investors had feared. (Reporting by Sinead Carew; Editing by Richard Chang)