Texas Instruments said Monday its first-quarter profit fell 4 percent, missing Wall Street estimates, as sales of cell phone chips continued to fall.
The Dallas-based chip maker Monday reported net income of $588 million, or 44 cents per share. A year ago, the company posted a profit of $614 million, or 42 cents per share in the same period.
Sales fell 2 percent to $3.35 billion. Analysts polled by Thomson Financial had expected profit of 46 cents per share on sales of $3.39 billion.
The results were at the lower end of the company's own estimates, which ranged from 43 cents to 47 cents per share in earnings and $3.33 billion and $3.46 billion in sales.
The company said overall demand fell unexpectedly in June as distributors reduced their inventory levels, partially because of "a weaker economic environment." TI's chairman and CEO, Rich Templeton, also suggested customers also had "greater confidence in TI's ability to deliver products within short lead times."
Two of TI's four divisions grew their sales by 10 percent each, but weren't enough to offset two lagging units.
Among the growers was the company's analog business, its largest division. It makes chips used in a variety of industrial products and consumer gadgets such as digital cameras and music players.
The other thriving division makes chips that are "embedded" into cars and other industrial products.
The laggards were the wireless division, which saw sales drop 12 percent, and a unit that makes miscellaneous products, like the mirror arrays that power rear-projection high-definition TV sets.