Texas Instruments slumps on disappointing Q4 revenue and profit outlook

Texas Instruments is down a little over 8% in premarket trading as investors react to the weaker-than-expected fourth-quarter guidance the company gave in its Q3 earnings yesterday.

The world’s biggest analog chipmaker said that Q4 revenue would come in between $4.22 billion and $4.58 billion, where analysts had expected $4.5 billion on average, per Bloomberg. TI’s profit forecast for the period also disappointed, after the company said that earnings would be in the region of $1.13 to $1.39 per share, compared to reported Wall Street estimates of $1.41.

While its actual third-quarter numbers were broadly solid all told, with adjusted EPS at $1.59 meeting expectations, the Q4 outlook is a clear signal to some that recovery will likely be a little more sluggish than they expected. As the company’s CEO, Haviv Ilan, put it on an analyst call:

“The overall semiconductor market recovery is continuing, though at a slower pace than prior upturns, likely related to the broader macroeconomic dynamics and overall uncertainty.”

Texas Instruments counts more customers than anyone else in the semiconductor business and has a broader range of products, too, making it something of a bellwether for the industry more broadly, with its softer outlook weighing modestly on stocks like Analog Devices, AMD, and Intel.