Texas Instruments tops 4Q expectations

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Texas Instruments (NYSE: TXN) topped the consensus analyst estimate in the fourth quarter.

After market close Monday, the maker of communications chips reported fourth quarter earnings 49 cents per share after taxes excluding one-time events and including writedowns. First Call's survey of 30 analysts predicted a profit of 47 cents per share.

Shares of Texas Instruments traded above 110 in after-hours activity. The stock closed Monday's regular session at 109 3/4.

Excluding acquisition-related charges and amortization, Texas Instruments earned $433 million, or 51 cents per share. The company recorded a non-recurring, acquisition-related charge of $86 million, or 6 cents per share after taxes; amortization of $26 million, or 2 cents after taxes; and a one-time tax benefit of $67 million, or 8 cents per share, related to research and experimental tax credits. Including all items, Texas Instruments reported net income of $430 million.

Fourth quarter revenue rose to $2.55 billion, a 26 percent improvement from $2.03 billion in the year ago period, when Texas Instruments earned $253 million, or 31 cents per share, on a pro forma basis. Semiconductor revenue increased to $2.2 billion, a 30 percent gain year-over-year and a 9 percent improvement from the third quarter.

Margins in the fourth quarter improved to 22.1 percent from 16.4 percent a year earlier.

For the full year, Texas Instruments saw pro forma earnings of $1.54 billion on revenue of $9.47 billion.

Semiconductor revenue should grow sequentially in the first quarter, the company said. "We expect continued strong growth in 2000, with DSP and analog as the catalysts," said Tom Engibous, TI chairman, president and CEO.

As the company expands to meet demannd, capital expenses in 2000 will rise 40 percent to $2 billion, Texas Instruments predicted. The company expects to spend $1.5 billion this year on research and development, compared to $1.3 billion in R&D in 1999.>