TI reports 3Q14 financial results and shareholder returns

Conference call on TI website at 4:30 p.m. Central time today

(PRNewswire) —  Texas Instruments Incorporated (TI) (NASDAQ: TXN) today reported third-quarter revenue of $3.50 billion, net income of $826 million and earnings per share of 76 cents.

Regarding the company's performance and returns to shareholders, Rich Templeton, TI's chairman, president and CEO, made the following comments:

  • "Revenue for the quarter was solidly in the upper half of our expected range and earnings were at the top of the range, marking another quarter of strong progress and execution.
  • "We delivered 8 percent year-over-year revenue growth.  Analog and Embedded Processing comprised 82 percent of third-quarter revenue.
  • "Gross margin of 58.4 percent, a new record, reflects the quality of our portfolio of Analog and Embedded Processing products as well as the efficiency of our manufacturing strategy.
  • "Our cash flow from operations once again reflects the strength of our business model.  Free cash flow for the trailing twelve-month period was up 20 percent from a year ago to $3.5 billion or 27 percent of revenue.  This represents an improvement of 3 percentage points from a year ago and is consistent with our targeted range of 20-30 percent of revenue.
  • "We returned $4.2 billion to shareholders in the past twelve months through stock repurchases and dividends paid.  In the quarter, we announced a dividend increase of 13 percent, resulting in an annualized rate of $1.36 per share.
  • "Our strategy to return to shareholders all free cash flow not needed for net debt retirement, and to return proceeds from exercises of equity compensation, reflects our confidence in the long-term sustainability of our business model.
  • "Our balance sheet remains strong, with $3.2 billion of cash and short-term investments at the end of the quarter, 81 percent of which was owned by the company's U.S. entities.  Inventory days were 108, consistent with our model of 105-115 days.
  • "TI's outlook for the fourth quarter of 2014 is for revenue in the range of $3.13 billion to $3.39 billion and earnings per share between $0.64 and $0.74.  At the midpoint of our range, revenue would increase 8 percent from the year-ago quarter.  The annual effective tax rate for 2014 is expected to be about 28 percent, unchanged from our previous guidance."

Free cash flow is a non-GAAP financial measure.  Free cash flow is cash flow from operations less capital expenditures.

Earnings summary

Amounts are in millions of dollars, except per-share amounts. 


3Q14

3Q13

Change

             Revenue

$ 3,501

$ 3,244

8%

             Operating profit

$ 1,175

$    844

39%

             Net income

$    826

$    629

31%

                    Earnings per share

$   0.76

$   0.56

36%

 

Cash generation

Amounts are in millions of dollars.




Trailing 12 Months



3Q14


3Q14

3Q13

Change

Cash flow from operations 

Capital expenditures 

Free cash flow 

Free cash flow % of revenue 

$  1,383

$     103

$  1,280

      37%


$ 3,819

$    367

$ 3,452

     27%

$ 3,270

$    402

$ 2,868

     24%

17%

-9%

20%

 


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