Texas Instruments reported first-quarter earnings and revenue on Monday that slightly exceeded analyst expectations as demand for its chips improved following concerns about a troubled global economy.
Shares of the semiconductor, which sells chips for everything from personal computers to industrial equipment, ticked up after the closing bell, following the news. What is Texas Instruments' stock doing now? (Click here for the latest after-hours quote.)
Following weak demand last year, orders for Texas Instruments' chips have picked up, although manufacturing customers remain cautious, Chief Financial Officer Kevin March told Reuters in a telephone interview.
Texas Instruments' book-to-bill ratio rose to 1.03 in the first quarter from 0.91 in the December quarter, he said, as the company built a backlog of orders.
"People generally remain quite careful with how much inventory they choose to carry as they kind of wait to read the tea leaves to see what the economy is really going to do," March said. He pointed to industrial and automotive as markets with solid demand.
Earnings excluding items were 32 cents a share, or $362 million, compared with $265 million or 22 cents per diluted share in the year-ago quarter.
Revenue declined 7 percent to to $2.89 billion from $3.12 billion a year ago.
Analysts had expected earnings excluding items of 30 cents a share on $2.85 billion in revenue, according to a consensus estimate from Thomson Reuters.
"I don't think things are falling off a cliff. People are cautious. If you can get any part in six weeks, why would you build inventory?" asked Sanford Bernstein analyst Stacy Rasgon.
For the second quarter, Texas Instruments said it expects earnings between 37 cents and 45 cents a share and revenue of $2.93 billion to $3.17 billion. Analysts currently expect 38 cents a share on $3.04 billion revenue.
This story was updated to reflect that earnings for the year-ago quarter were 22 cents a share.