Chip maker Texas Instruments lowered its outlook for quarterly earnings and revenue in the first quarter on weaker than expected chip demand and its shares fell as much as 5.5 percent.
TI, which makes chips for everything from cell phones to televisions, cut its first-quarter earnings per share forecast to 41 cents to 45 cents from its target of 43 cents to 49 cents issued Jan. 22.
It forecast revenue of $3.21 billion to $3.35 billion compared with its previous target of $3.27 billion to $3.55 billion citing solid demand for its chips.
Shares recently were trading down nearly 4 percent. In Europe, Nokia and other technology stocks fell on Tuesday on the warning.
Analysts on average expected earnings of 46 cents per share on revenue of $3.4 billion, according to Reuters Estimates.
The company forecast semiconductor revenue in a range of $3.14 billion to $3.26 billion for the quarter down from its previous estimate of $3.20 billion to $3.46 billion.
Shares immediately fell more than 5 percent to $28.01 in late trade after closing at $29.65 on the new York Stock Exchange.
Before the news TI shares had already lost more than 11 percent of their value since the start of 2008 as investors worried it would be hurt by a slowdown in the U.S. economy.
'Pretty Significant' Revisions
Texas Instruments cut its first-quarter revenue target due to weaker than expected demand in wireless chips, investor relations executive Ron Slaymaker said on a conference call with analysts.
He said that TI had received "pretty significant downward revisions" in wireless chip demand, particularly for high-end phones such as those with high-speed Web links and cited changing plans at one customer in particular.