Texas Instruments Incorporated (TI) reports Q4 2023 and 2023 financial results and shareholder returns
Conference call on TI website at 3:30 p.m. Central time today
PR Newswire
DALLAS, Jan. 23, 2024
DALLAS, Jan. 23, 2024 /PRNewswire/ — Texas Instruments Incorporated (TI) (Nasdaq: TXN) today reported fourth quarter revenue of $4.08 billion, net income of $1.37 billion and earnings per share of $1.49. Earnings per share included a 3-cent benefit that was 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 10% sequentially and 13% from the same quarter a year
ago. During the quarter we experienced increasing weakness across
industrial and a sequential decline in automotive.
-- "Our cash flow from operations of $6.4 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 $1.3 billion.
-- "Over the past 12 months we invested $3.7 billion in R&D and SG&A,
invested $5.1 billion in capital expenditures and returned $4.9 billion
to owners.
-- "TI's first quarter outlook is for revenue in the range of $3.45 billion
to $3.75 billion and earnings per share between $0.96 and $1.16. We now
expect our 2024 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) Q4 2023 Q4 2022 Change
--------- --------- ------
Revenue $ 4,077 $ 4,670 (13) %
Operating profit $ 1,533 $ 2,176 (30) %
Net income $ 1,371 $ 1,962 (30) %
Earnings per share $ 1.49 $ 2.13 (30) %
Cash generation
Trailing 12 Months
(In millions) Q4 2023 Q4 2023 Q4 2022 Change
--------- --------- ------- ------
Cash flow from operations $ 1,924 $ 6,420 $ 8,720 (26) %
Capital expenditures $ 1,148 $ 5,071 $ 2,797 81 %
Free cash flow $ 776 $ 1,349 $ 5,923 (77) %
Free cash flow % of revenue 7.7 % 29.6 %
Cash return
Trailing 12 Months
----------------------------
(In millions) Q4 2023 Q4 2023 Q4 2022 Change
--------- --------- --------- ------
Dividends paid $ 1,181 $ 4,557 $ 4,297 6 %
Stock repurchases $ 65 $ 293 $ 3,615 (92) %
Total cash returned $ 1,246 $ 4,850 $ 7,912 (39) %
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated
Statements of For Three Months Ended For Years Ended
Income December 31, December 31,
------------------ ------------------------ -------------------
(In millions,
except per-share
amounts) 2023 2022 2023 2022
------------ ---------- ---------- -------
Revenue $ 4,077 $ 4,670 $ 17,519 $20,028
Cost of revenue
(COR) 1,646 1,583 6,500 6,257
-------- --------- ------ ------
Gross profit 2,431 3,087 11,019 13,771
Research and
development (R&D) 460 434 1,863 1,670
Selling, general
and administrative
(SG&A) 438 429 1,825 1,704
Restructuring
charges/other -- 48 -- 257
-------- --------- ------ ------
Operating profit 1,533 2,176 7,331 10,140
Other income
(expense), net
(OI&E) 113 51 440 106
Interest and debt
expense 98 60 353 214
-------- --------- ------ ------
Income before
income taxes 1,548 2,167 7,418 10,032
Provision for
income taxes 177 205 908 1,283
-------- --------- ------ ------
Net income $ 1,371 $ 1,962 $ 6,510 $ 8,749
======== ========= ====== ======
Diluted earnings
per common share $ 1.49 $ 2.13 $ 7.07 $ 9.41
======== ========= ====== ======
Average shares
outstanding:
Basic 908 906 908 916
======== ========= ====== ======
Diluted 915 916 916 926
======== ========= ====== ======
Cash dividends
declared per
common share $ 1.30 $ 1.24 $ 5.02 $ 4.69
======== ========= ====== ======
Supplemental Information
Provision for
income taxes is
based on the
following:
Operating taxes
(calculated using
the estimated
annual effective
tax rate) $ 180 $ 237 $ 974 $ 1,384
Discrete tax items (3) (32) (66) (101)
-------- --------- ------ ------
Provision for
income taxes
(effective taxes) $ 177 $ 205 $ 908 $ 1,283
======== ========= ====== ======
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 $ 1,371 $ 1,962 $ 6,510 $ 8,749
Income allocated to
RSUs (7) (9) (33) (39)
-------- --------- ------ ------
Income allocated to
common stock for
diluted EPS $ 1,364 $ 1,953 $ 6,477 $ 8,710
======== ========= ====== ======
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated Balance Sheets December 31,
-----------------------------------------------
(In millions, except par value) 2023 2022
--------- ---------
Assets
Current assets:
Cash and cash equivalents $ 2,964 $ 3,050
Short-term investments 5,611 6,017
Accounts receivable, net of allowances of
($16) and ($13) 1,787 1,895
Raw materials 420 353
Work in process 2,109 1,546
Finished goods 1,470 858
-------- --------
Inventories 3,999 2,757
Prepaid expenses and other current assets 761 302
-------- --------
Total current assets 15,122 14,021
-------- --------
Property, plant and equipment at cost 13,268 9,950
Accumulated depreciation (3,269) (3,074)
-------- --------
Property, plant and equipment 9,999 6,876
Goodwill 4,362 4,362
Deferred tax assets 757 473
Capitalized software licenses 223 152
Overfunded retirement plans 173 188
Other long-term assets 1,712 1,135
-------- --------
Total assets $ 32,348 $ 27,207
======== ========
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt $ 599 $ 500
Accounts payable 802 851
Accrued compensation 836 799
Income taxes payable 172 189
Accrued expenses and other liabilities 911 646
-------- --------
Total current liabilities 3,320 2,985
-------- --------
Long-term debt 10,624 8,235
Underfunded retirement plans 108 118
Deferred tax liabilities 63 66
Other long-term liabilities 1,336 1,226
-------- --------
Total liabilities 15,451 12,630
-------- --------
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 3,362 2,951