Texas Instruments Inc (NASDAQ:TXN) posted third-quarter results above expectations and its CFO said business was healthy, in contrast to recent concerns on Wall Street about a possible slowdown in chip demand.
The Dallas, Texas-based company's growth in the third quarter was driven by demand for chips used in communications equipment, industrial markets and automotive, CFO Kevin March told Reuters in a phone interview.
"We feel pretty good about the portfolio and the way the company is executing and our customers seem to be happy because they keep on giving us plenty of orders and keeping us busy," March said.
Texas Instruments' quarterly results on Monday came after Chandler, Arizona-based Microchip on Oct 9 warned of weak demand in China that would soon become visible across the chip industry, sparking a broad selloff in chip stocks.
RBC analyst Doug Freedman was cautiously optimistic about Texas Instruments' results and he said he wanted to hear more details from management on a coming quarterly conference call.
Texas Instruments said in a statement its third-quarter net income rose 31 percent to $826 million. Its earnings per share were 76 cents. Analysts on average expected earnings of 71 cents.
The company reported quarterly revenue of $3.50 billion, up 8 percent from the year-ago period. It forecast fourth-quarter revenue of $3.13 billion to $3.39 billion. The mid-point of TI's revenue guidance is about $26 billion.
Analysts on average had expected revenue of $3.46 billion for the third quarter and $3.24 billion for the fourth quarter, according to Thomson Reuters I/B/E/S.
The chipmaker said its fourth-quarter earnings per share would range from 64 cents to 74 cents.
Shares of TI rose 2.23 percent in extended trade after closing up 1.69 percent at $44.41 on Nasdaq.
(Reporting by Noel Randewich; Editing by Bernard Orr and Gunna Dickson)