TI blames Nokia for lower Q2 revenue forecast

Lower demand for Nokia's phones and services triggers TI to project lower Q2 revenue

Texas Instruments has lowered its revenue forecast for the second fiscal quarter due to lower demand for its products from Nokia.

TI said its lower revenue projection is directly related to the market performance of Nokia, which has been having troubles of its own. The handset maker last week projected lower sales of devices and services due to lower average selling prices and fewer buyers of its phones.

TI is now forecasting revenue of US$3.36 billion and $3.50 billion for the second fiscal quarter ending on June 30, down from $3.41 billion to $3.69 billion the company forecast on April 18 when reporting first quarter fiscal results.

"I would say characterizing as the bulk of it being Nokia is probably understating. Probably being closer to say all of the change in our ... middle-of-the-range update versus what we were previously [projecting] was associated with that customer," said Ron Slaymaker, vice president and head of investor relations at TI, during a revenue forecast conference call that was webcast on Wednesday.

Nokia is the world's largest smartphone maker, but is quickly losing market share to competitors Apple, Research in Motion, Samsung and HTC, according to IDC. Nokia's market share dropped to 24.3 percent in the first quarter this year, falling from 38.8 percent during the previous year's first quarter. Nokia shipped 24.2 million handsets worldwide in the first quarter, growing by 12.6 percent year-over-year. Apple was in second place, with shipments growing 114.4 percent to 18.7 million units, and market share growing to 18.7 percent.

"This is a customer performance in the market issue. This is not a competitor coming on board to displace TI in these handsets," Slaymaker said.

Outside of Nokia, demand for TI's products are tracking as expected, Slaymaker said. The company is benefitting from growing demand for smartphones, tablets and e-readers, while PC-related revenue will be "flattish" on slower-than-expected PC growth. TI supplies chips for products ranging from smartphones and PCs to automotive and medical products.

TI is also continuing to feel an impact of the Japan earthquake on March 11 and ensuing tsunami, Slaymaker said. The company has a manufacturing site in Miho, Japan, which is about 40 miles northeast of Tokyo, and suffered substantial damage from the earthquake. Repairs on the factory are continuing, and the Japan disaster will be behind the company in the second half, Slaymaker said.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags texas instrumentsComponentsprocessors

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?