Texas Instruments is cutting 12 percent of its workforce because the company is "not counting on a near-term economic rebound for improvement."
TI delivered the latest round of cutbacks--joining companies like Microsoft, Intel and Sprint--as it reported better than expected fourth quarter results. TI said there will be 1,800 layoffs and 1,600 voluntary retirements or departures (statement).
The company reported fourth quarter net income of $107 million, or 8 cents a share, on revenue of $2.49 billion. Excluding a restructuring charge, TI would have been 21 cents a share. Wall Street was betting on earnings of 12 cents a share on revenue of $2.37 billion. While the earnings were better than expected it's a bit of a hollow victory since TI--like most companies--had issued profit warnings. Fourth quarter orders were down 47 percent from a year ago and 42 percent from the third quarter.
In the same quarter a year ago, TI reported net income of $753 million, or 54 cents a share, on revenue of $3.55 billion. Add it up and fourth quarter earnings were down 85 percent from a year ago and revenue fell 30 percent.
And TI isn't counting on any improvement. The company said first quarter revenue will be between $1.62 billion and $2.12 billion with earnings ranging from 11 cents a share to a 3 cents a share profit. With that range it's clear that TI has no idea what to expect.
In a statement, TI CEO Rich Templeton said by "reducing expenses now, we keep TI financially strong and able to invest for future growth." Templeton added that the company will up its bets on analog and embedded processors.
Here's a look at TI's breakdown by business: