Is a Beat in the Cards for Texas Instruments in Q3 Earnings?

Core Viewpoint - Texas Instruments is expected to report a decline in revenues and earnings for the third quarter of 2024, with management projecting revenues between $3.94 billion and $4.26 billion and earnings per share between $1.24 and $1.48, reflecting a significant decrease from the previous year [1][2]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for Texas Instruments' revenues is $4.11 billion, indicating a 9.3% decline from the same quarter last year [1]. - The consensus estimate for earnings per share is $1.36, which represents a 24.4% decrease compared to the prior-year quarter [1]. Segment Performance - The Analog segment is expected to generate revenues of $3.14 billion, down 6.4% year-over-year, while the Embedded Processing segment is projected to see revenues of $662.4 million, a decline of 25.6% from the previous year [2]. - A weakening demand environment, primarily due to customer inventory reductions, is anticipated to negatively impact these segments [2]. Positive Factors - Despite challenges, Texas Instruments' investments in growth avenues, competitive advantages in manufacturing and technology, and product portfolio expansion are expected to contribute positively to its performance [3]. - The company's focus on increasing free cash flow generation and continuous returns to shareholders are also seen as supportive factors for its upcoming results [3]. Earnings Prediction - The earnings model suggests a potential earnings beat for Texas Instruments, with an Earnings ESP of +0.44% based on the Most Accurate Estimate of $1.37 per share compared to the Zacks Consensus Estimate of $1.36 [4]. - Texas Instruments currently holds a Zacks Rank of 3 (Hold), which indicates a moderate outlook for the company's earnings performance [4].