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To: Johnny Canuck who wrote (39952)	7/21/2003 8:00:35 PM
From: Johnny Canuck	Read Replies (1) \| Respond to of 69315

Texas Instruments sees chip sales rebound By Tom Foremski in San Francisco Published: July 21 2003 23:25 \| Last Updated: July 21 2003 23:25 Texas Instruments, the world's largest communications chipmaker, on Monday reported a rebound in sales that had been affected by the Sars outbreak, leading to slightly better-than-expected second-quarter results. The company had warned six weeks ago that the impact of Sars was likely to reduce its revenues in wireless chip sales. However, customer demand grew strongly in the final days of the June quarter. The chipmaker is the second largest in the US and leads in chips for communications products and equipment. "Sequential growth across almost all of our major product lines more than offset a decline in wireless," said Tom Engibous, chief executive. Revenues grew 8 per cent to $2339m as net income jumped 27 per cent to $121m or 7 cents per share, from the year ago period. Texas Instruments had guided to earnings of 6 cents per share because of Sars. The company predicted third quarter revenues and income should rise on a sequential basis. Revenues should be between $2.29bn to $2.49bm and earnings per share of 19 cents to 23 cents, which would include 13 cents due to its sale of shares in Micron Technology, the largest US memory chipmaker. The company's largest business is chips, but it also sells calculators. This business group had a seasonally strong quarter with revenue up 4 per cent to $156m as retailers stocked up for back-to-school sales. Gross profit margin slipped 1.4 percentage points to 38.6 per cent on a sequential basis because of newer chip products that are still ramping up production. These include digital light processing chips, which are being used in digital projectors, a fast growing market. It did not change its capital expenditure for this year of $800m. It is one of the few chipmakers that is building an advanced 300mm chip manufacturing facility. This will be located near its Dallas, Texas headquarters and the project includes a research partnership with the University of Texas at Dallas to help develop future chip technologies and expertise. TI has managed to grow revenues and earnings this year despite continued weakness in global chip markets. This is because of a large restructuring several years ago in which it exited the memory chip business by selling its operations to Micron, and focusing on the production of digital signal processors, widely used in large number of digital products. In extended hours trading on Monday, TI shares gained 3 per cent or 58 cents to $18.46, reversing much of a 4 per cent decline at the close of markets.