Shares of Texas Instruments, Inc. ($TXN) are down sharply Tuesday as the Dallas-based chipmaker prepares to unveil its third-quarter results after the market close.
Retail sentiment toward the stock has been on the wane since mid-October but has reversed course early Tuesday.
TI becomes the first among the major U.S. chipmakers to announce earnings and its report will likely provide a foretaste of what is in store from the rest in the space.
Analysts, on average, expect the company to report earnings per share (EPS) of $1.38 per, lower than the year-ago’s $1.85. The consensus models a 10% year-over-year
(YoY) revenue-decline from $4.58 billion to $4.12 billion. In late-July, the company guided third-quarter revenue and EPS to $1.24-$1.48 and $3.94 billion-$4.26 billion, respectively.
TI has been reporting earnings and sales decline for seven straight quarters now and analysts expect the trend to continue at least for one more quarter before things take a turn for the better, Investor Business Daily reported. The company may have ridden the trough of a cyclical down trend by then.
TI’s woes reflect inclement conditions in the company’s key end markets such as automotive and industrial segments. These two end-markets accounted for 74% of the company’s total revenue in 2023.
On Stocktwits, TI’s sentiment score has turned ‘bullish’ and was at 60/100 as of 10:21 am ET, flipping from the 'extremely bearish' score of 22 on Monday. Message volume, with a score of 88/100, has been at the highest level in over a year.
Retail traders look ahead to a dividend from the company and see it as a long-term bet.
From a late-August high of $214.66, TI stock has pulled back about 9%. The VanEck Semiconductor ETF ($SMH), an exchange-traded fund in which TI is the ninth biggest holding, fell 0.64% to $251.22.
As of 10:24 am ET, the stock was down 0.97% at $193.87.
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