I titled my last Texas Instruments earnings digest “Light at the end of the tunnel,” but it seems the tunnel got slightly longer this quarter. The company’s revenue decreased sequentially in Q4, and management guided for another sequential decrease (although a year-over-year increase) for Q1. These numbers might sound worrying at first sight, but they need context. The goal of any quarterly release should be to understand if the thesis remains intact (it’ll be rare for a thesis to change entirely in any given quarter). I’ll focus on the quarter and not the entire year, as I believe it makes much more sense for a cyclical company like Texas Instruments.
Let’s start with the numbers. Here’s the summary table for Texas Instruments:
As you can see in the table, the numbers don’t offer much to be excited about.