TI reports first quarter 2024 financial results and shareholder returns
Conference call on TI website at 3:30 p.m. Central time today
PR Newswire
DALLAS, April 23, 2024
DALLAS, April 23, 2024 /PRNewswire/ — Texas Instruments Incorporated (TI) (Nasdaq: TXN) today reported first quarter revenue of $3.66 billion, net income of $1.11 billion and earnings per share of $1.20. Earnings per share included a 10-cent benefit for items that were not in the company’s original guidance.
Regarding the company’s performance and returns to shareholders, Haviv Ilan, TI’s president and CEO, made the following comments:
-- "Revenue decreased 16% from the same quarter a year ago and 10%
sequentially, as revenue declined across all end markets.
-- "Our cash flow from operations of $6.3 billion for the trailing 12 months
again underscored the strength of our business model, the quality of our
product portfolio and the benefit of 300mm production. Free cash flow for
the same period was $940 million.
-- "Over the past 12 months we invested $3.7 billion in R&D and SG&A,
invested $5.3 billion in capital expenditures and returned $4.8 billion
to owners.
-- "TI's second quarter outlook is for revenue in the range of $3.65 billion
to $3.95 billion and earnings per share between $1.05 and $1.25. We
continue to expect our effective tax rate to be about 13%."
Free cash flow, a non-GAAP financial measure, is cash flow from operations less capital expenditures.
Earnings summary
(In millions, except per-share amounts) Q1 2024 Q1 2023 Change
--------- --------- ------
Revenue $ 3,661 $ 4,379 (16) %
Operating profit $ 1,286 $ 1,934 (34) %
Net income $ 1,105 $ 1,708 (35) %
Earnings per share $ 1.20 $ 1.85 (35) %
Cash generation
Trailing 12 Months
(In millions) Q1 2024 Q1 2024 Q1 2023 Change
--------- --------- ------- ------
Cash flow from operations $ 1,017 $ 6,277 $ 7,736 (19) %
Capital expenditures $ 1,248 $ 5,337 $ 3,336 60 %
Free cash flow $ (231) $ 940 $ 4,400 (79) %
Free cash flow % of revenue 5.6 % 22.6 %
Cash return
Trailing 12 Months
----------------------------
(In millions) Q1 2024 Q1 2024 Q1 2023 Change
--------- --------- --------- ------
Dividends paid $ 1,183 $ 4,615 $ 4,359 6 %
Stock repurchases $ 3 $ 193 $ 3,129 (94) %
Total cash returned $ 1,186 $ 4,808 $ 7,488 (36) %
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
For Three Months Ended
Consolidated Statements of Income March 31,
-------------------------------------------
(In millions, except per-share amounts) 2024 2023
-------------- ----------
Revenue $ 3,661 $ 4,379
Cost of revenue (COR) 1,566 1,516
---------- ---------
Gross profit 2,095 2,863
Research and development (R&D) 478 455
Selling, general and administrative (SG&A) 455 474
Restructuring charges/other (124) --
---------- ---------
Operating profit 1,286 1,934
Other income (expense), net (OI&E) 123 80
Interest and debt expense 116 68
---------- ---------
Income before income taxes 1,293 1,946
Provision for income taxes 188 238
---------- ---------
Net income $ 1,105 $ 1,708
========== =========
Diluted earnings per common share $ 1.20 $ 1.85
========== =========
Average shares outstanding:
Basic 910 907
========== =========
Diluted 917 916
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Cash dividends declared per common share $ 1.30 $ 1.24
========== =========
Supplemental Information
(Quarterly, except as noted)
Provision for income taxes is based on the
following:
Operating taxes (calculated using the
estimated annual effective tax rate) $ 176 $ 276
Discrete tax items 12 (38)
---------- ---------
Provision for income taxes (effective taxes) $ 188 $ 238
========== =========
A portion of net income is allocated to unvested restricted stock units
(RSUs) on which we pay dividend equivalents. Diluted EPS is calculated
using the following:
Net income $ 1,105 $ 1,708
Income allocated to RSUs (5) (9)
---------- ---------
Income allocated to common stock for diluted
EPS $ 1,100 $ 1,699
========== =========
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated Balance Sheets March 31,
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(In millions, except par value) 2024 2023
--------- ---------
Assets
Current assets:
Cash and cash equivalents $ 2,483 $ 4,477
Short-term investments 7,910 5,068
Accounts receivable, net of allowances of
($20) and ($13) 1,671 1,877
Raw materials 417 378
Work in process 2,129 1,850
Finished goods 1,537 1,060
-------- --------
Inventories 4,083 3,288
Prepaid expenses and other current assets 1,301 313
-------- --------
Total current assets 17,448 15,023
-------- --------
Property, plant and equipment at cost 13,739 10,791
Accumulated depreciation (3,297) (3,126)
-------- --------
Property, plant and equipment 10,442 7,665
Goodwill 4,362 4,362
Deferred tax assets 821 486
Capitalized software licenses 231 140
Overfunded retirement plans 169 189
Other long-term assets 1,412 1,355
-------- --------
Total assets $ 34,885 $ 29,220
======== ========
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt $ 1,349 $ 500
Accounts payable 551 952
Accrued compensation 399 394
Income taxes payable 378 372
Accrued expenses and other liabilities 876 686
-------- --------
Total current liabilities 3,553 2,904
-------- --------
Long-term debt 12,840 9,626
Underfunded retirement plans 111 123
Deferred tax liabilities 55 73
Other long-term liabilities 1,343 1,251
-------- --------
Total liabilities 17,902 13,977
-------- --------
Stockholders' equity:
Preferred stock, $25 par value. Shares
authorized -- 10; none issued -- --
Common stock, $1 par value. Shares authorized
-- 2,400; shares issued -- 1,741 1,741 1,741
Paid-in capital 3,439 3,016
Retained earnings 52,199 50,930
Treasury common stock at cost
Shares: March 31, 2024 -- 831; March 31, 2023