Texas Instruments said the Japan earthquake damaged two of its factories, hurt demand in the country and cut into its earnings.
The chipmaker, which recently said it would buy National Semiconductor, reported first quarter earnings of $666 million, or 55 cents a share, on revenue of $3.39 billion. Wall Street was looking for earnings of 58 cents a share on revenue of $3.39 billion.
TI said that earthquake related expenses in Japan shaved about 2 cents a share off its operating profit.
CEO Rich Templeton said in a statement:
2011 started strong, with customer demand in January and February tracking our expectations for a first quarter of above-seasonal growth. But the Japan earthquake that's taken such a heartbreaking human toll in the country also disrupted local demand starting in mid-March and impaired operations at two of our factories there. This impact and substantially weaker demand for Wireless baseband chips resulted in revenue that was below the middle of our expected range. The lower revenue combined with expenses resulting from the earthquake affected earnings per share. New orders, however, were strong through the quarter, indicative of the underlying strength in our markets.
Recovery of our operations in Japan is progressing well.
The company said that one of the factories will be resuming normal production soon. The other plant has restarted initial processing of wafers and expects to be on schedule for full loadings in mid July. Templeton added that many of TI's customers are also trying to restart plants.
For the second quarter, TI projected revenue of $3.41 billion to $3.69 billion on earnings of 52 cents a share to 60 cents a share. Wall Street was expecting earnings of 62 cents a share on revenue of $3.52 billion.