Texas Instruments Reports 8% Revenue Decline, 12% Gross Profit Decline in Q3 2024

Texas Instruments Inc. reported its financial results for the third quarter and the first nine months of 2024, revealing a decline in revenue and profitability compared to the previous fiscal period. For the three months ended September 30, 2024, the company generated revenue of $4,151 million, an 8% decrease from $4,532 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenue was $11,634 million, down 13% from $13,442 million in the prior year.

Gross profit for Q3 2024 was $2,474 million, reflecting a 12% decline from $2,814 million in Q3 2023, with a gross profit margin of 59.6%, down from 62.1%. Operating profit for the third quarter was $1,554 million, or 37.4% of revenue, compared to $1,892 million, or 41.7% of revenue, in the same period last year. Net income for Q3 2024 was $1,362 million, down from $1,700 million in Q3 2023, resulting in a basic earnings per share (EPS) of $1.48, compared to $1.87 in the prior year.

For the nine months ended September 30, 2024, net income was $3,594 million, a significant decrease from $5,139 million in the same period of 2023. The basic EPS for the nine months was $3.92, down from $5.63 in the previous year. The decline in profitability was attributed to lower revenue across all segments, particularly in Embedded Processing, which saw a 27% drop in revenue.

Total assets increased to $35,321 million as of September 30, 2024, up from $32,348 million at the end of 2023. However, total liabilities also rose to $18,053 million from $15,451 million, with long-term debt increasing to $12,844 million from $10,624 million. The company reported cash and cash equivalents of $2,589 million, down from $2,964 million at the end of 2023.

In terms of strategic developments, Texas Instruments announced a 5% increase in dividends in September 2024, marking 21 consecutive years of dividend increases. The company also signed a preliminary memorandum of terms with the U.S. Department of Commerce for potential funding under the CHIPS Act, indicating a focus on enhancing its manufacturing capabilities. Additionally, Texas Instruments reported a credit of $124 million in restructuring charges for the first nine months of 2024, primarily due to a gain on the sale of a property.

Overall, Texas Instruments is navigating a challenging market environment, with significant revenue and profit declines, while continuing to invest in its long-term growth strategies.