Analog chip manufacturer Texas Instruments (NASDAQ:TXN) will be reporting results tomorrow after market close. Here's what to look for.
Last quarter Texas Instruments reported revenues of $4.53 billion, down 13.1% year on year, beating analyst revenue expectations by 3.67%. It was a weaker quarter for the company, with a decline in its gross margin and an increase in its inventory levels.
Is Texas Instruments buy or sell heading into the earnings? Read our full analysis here, it's free.
This quarter analysts are expecting Texas Instruments's revenue to decline 12.5% year on year to $4.59 billion, a further deceleration on the 12.9% year-over-year decrease in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.85 per share.
The analysts covering the company have been growing increasingly bullish about the business heading into the earnings, with revenue estimates seeing three upward revisions over the last thirty days. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 3.87%.
Looking at Texas Instruments's peers in the semiconductors segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. SMART's revenues decreased 27.7% year on year, missing analyst estimates by 15.6% and Lam Research reported revenue decline of 31.4% year on year, exceeding estimates by 1.94%. SMART traded down 23.6% on the results, Lam Research was down 3.5%.
Technology stocks have been hit hard by fears of higher interest rates and while some of the semiconductors stocks have fared somewhat better, they have not been spared, with share price declining 5.43% over the last month. Texas Instruments is down 7.68% during the same time, and is heading into the earnings with analysts' average price target of $181.1, compared to share price of $148.6.
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The author has no position in any of the stocks mentioned.