Summary
Texas Instruments (TXN) reported its third quarter and nine-month results for 2019, indicating a slowdown in revenue and profitability compared to the prior year. For the third quarter, revenue decreased 11% year-over-year to $3.77 billion, and net income fell to $1.43 billion from $1.57 billion in Q3 2018, translating to a diluted EPS of $1.49. The decline was primarily driven by weaker demand in both the Analog and Embedded Processing segments, with revenues down 8% and 19% respectively. Despite the revenue dip, the company highlighted its strong free cash flow generation of $6.0 billion for the trailing twelve months and continued commitment to returning capital to shareholders through dividends and share repurchases. For the first nine months of 2019, revenue was $11.03 billion, a decrease of 9% from the same period in 2018. Net income for the nine months was $3.95 billion, down from $4.34 billion in the prior year. Management attributed the performance to macroeconomic factors affecting most markets. The company continues to invest in its core Analog and Embedded Processing segments, with a strategic focus on the industrial and automotive markets, leveraging its manufacturing capabilities and broad product portfolio.
Financial Highlights
53 data points| Revenue | $3.77B |
| Cost of Revenue | $1.32B |
| Gross Profit | $2.45B |
| R&D Expenses | $379.00M |
| SG&A Expenses | $399.00M |
| Operating Income | $1.59B |
| Net Income | $1.43B |
| EPS (Basic) | $1.51 |
| EPS (Diluted) | $1.49 |
| Shares Outstanding (Basic) | 935.00M |
| Shares Outstanding (Diluted) | 950.00M |
Key Highlights
- 1Revenue for the third quarter of 2019 decreased by 11% to $3.77 billion compared to $4.26 billion in the third quarter of 2018.
- 2Net income for the third quarter of 2019 was $1.43 billion, a decrease from $1.57 billion in the same period of 2018.
- 3Diluted Earnings Per Share (EPS) for Q3 2019 was $1.49, down from $1.58 in Q3 2018.
- 4Both key segments, Analog and Embedded Processing, saw revenue declines: Analog down 8% and Embedded Processing down 19% year-over-year for Q3.
- 5Free cash flow for the trailing twelve months ended September 30, 2019, was $6.0 billion, representing 40.9% of revenue, demonstrating strong cash generation.
- 6The company returned $7.4 billion to shareholders in the past 12 months through stock repurchases and dividends, with a 17% increase in dividend announced.
- 7Total cash and short-term investments stood at $5.07 billion as of September 30, 2019, indicating a healthy liquidity position.