Discuss Company Profile of Texas Instruments within the Company Profiles & News !! forums, part of the Mirror View - Ebooks Links & Miscellenous Reading Material category; Texas Instruments Inc. (NYSE: TXN), widely known as TI, is an American company based in Dallas, Texas, United States, renowned ...
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Company Profile of Texas Instruments
Company Profile of Texas Instruments - May 14th, 2011
Texas Instruments Inc. (NYSE: TXN), widely known as TI, is an American company based in Dallas, Texas, United States, renowned for developing and commercializing semiconductor and computer technology. TI is the No. 3 manufacturer of semiconductors worldwide after Intel and Samsung, the No. 2 supplier of chips for cellular handsets after Qualcomm, and the No. 1 producer of digital signal processors (DSPs) and analog semiconductors, among a wide range of other semiconductor products. In 2010, the company was listed at number 223 on the Fortune 500.
Texas Instruments Inc. (TI) operates as one of the largest semiconductor manufacturers in the world. By 2001, it had a leading market share in the analog chip and digital signal processor (DSP) industries. In fact, over half of the world's wireless phones have TI's DSPs. The company's main businesses include semiconductors, which accounted for 87 percent of revenues in 2000; educational and productivity solutions; sensors and controls; and digital light processing (DLP) products. While TI experienced record financial results in 2000, the company's profits were significantly impacted during 2001, when the semiconductor industry experienced one of worst downturns in its history.
Texas Instruments Incorporated (TI) is engaged in the designing and making of semiconductors that it sells to electronics designers and manufacturers worldwide. In addition, it sells calculators and related products. As of December 31, 2010, the Company had design, manufacturing or sales operations in more than 30 countries. TI has four segments: Analog, Embedded Processing, Wireless and Other. Its products are sold to original equipment manufacturers (OEMs), original design manufacturers (ODMs), contract manufacturers and distributors. The Company’s trademarks include Texas Instruments, OMAP and DLP.
Analog semiconductors change real-world signals, such as sound, temperature, pressure or images by conditioning them, amplifying them and often converting them to a stream of digital data that can be processed by other semiconductors, such as digital signal processors (DSPs). Analog semiconductors are also used to manage power distribution and consumption. Its Analog product lines include high-performance analog, high-volume analog & logic, and power management. During the year ended December 31, 2010, Analog segment generated 43% of the Company’s revenue. High-performance analog products include standard analog semiconductors, such as amplifiers, data converters and interface semiconductors that TI markets to different customers who use them in manufacturing a range of products sold in many end markets, including the industrial, communications, computing and consumer electronics markets. High-performance analog products generally have long life cycles, often more than 10 years.
High-volume analog & logic products include products for specific applications, including custom products. The life cycles of its high-volume analog products are generally shorter than those of its high-performance analog products. End markets for high-volume analog products include communications, automotive, computing and consumer electronics products. Logic and standard linear includes commodity products marketed to different customers for different applications. Power management products include both standard and custom semiconductors that help customers manage power in any type of electronic system. It designs and manufactures power management semiconductors for both portable devices, including battery-powered devices, such as handheld consumer electronics, laptop computers and cordless power tools and line-powered systems include products that require an external electrical source, such as computers, digital television (TV), wireless base stations and high-voltage industrial equipment.
The Company competes with Analog Devices, Inc., Freescale Semiconductor, Inc., Fairchild Semiconductor Corporation, Infineon Technologies AG, Intersil Corporation, Linear Technology Corporation, Maxim Integrated Products, Inc., National Semiconductor Corporation, NXP Semiconductors N.V., Richtek Technology Corporation, and STMicroelectronics NV.
TI’s embedded processing products include DSPs and microcontrollers. DSPs perform mathematical computations to process or improve digital data. Microcontrollers are designed to control a set of specific tasks for electronic equipment. During 2010, sales of embedded processing products generated 15% of TI’s revenue.
The Company competes with Atmel Corporation, Freescale Semiconductor, Inc., Marvell Technology Group, Ltd., Microchip Technology, Inc., NXP Semiconductors N.V., Renesas Electronics Corporation, and STMicroelectronics NV.
The Company designs, makes and sells wireless products. Wireless products are sold in high volumes, and its Wireless portfolio includes both standard products and custom products. Sales of Wireless products generated about 21% of its revenue in 2010. The Company’s Wireless investments are concentrated on its connectivity products and OMAP applications processors.
The Company competes with Broadcom Corp., CSR plc, Intel Corporation, Marvell Technology Group, Ltd., NVIDIA Corporation, QUALCOMM Incorporated, Renesas Electronics Corporation, Samsung LSI, and ST-Ericsson.
The Company’s other segment includes revenue from its smaller semiconductor product lines and from sales of its handheld graphing and scientific calculators. It also includes royalties received for its technology that it licenses to other electronics companies and revenue from transitional supply agreements entered into in connection with acquisitions and divestitures. The semiconductor products in its Other segment include DLP products (primarily used in projectors to create high-definition images) and custom semiconductors known as application-specific integrated circuits (ASICs). This segment generated about 21% of its revenue in 2010.
While TI worked hard to get itself back on track in the 1990s, it continued to face hardships. During 1996, the price of its memory chips dropped by nearly 80 percent. Then, during an overseas business meeting in May, Junkins died suddenly of heart failure. Long-time TI employee Tom Engibous took over as president and CEO and stepped up the company's acquisition and divestiture plan. In 1997, several of the firm's business units were sold including Defense Systems & Electronics, Mobile Computing, Software, MulTIpoint Systems, Inspection Equipment, the Mold Manufacturing businesses, the Chemical Operations department, the Telecommunications Systems division, and the Power semiconductor unit. The company also made several key acquisitions including Intersect Technologies, Amati Communications Corp., and GO DSP Corp.
When questioned about the company's rapid movements in a 1997 Electronic Business article, Engibous commented "a tragedy like that--referring to Junkins' death--causes you to spend time reflecting. We concluded that what we were doing was in the right direction, but we thought we needed to do it at a much more rapid pace." As such, the company continued to acquire firms related to its DSP focus including Spectron Microsystems, Adaptec Inc., Oasix Corp., and Arisix Corp. TI also sold its memory chip business to Micron Technologies Inc. for $880 million.
The acquisitions continued into the following year. TI added Butterfly VLSI Ltd., Integrated Sensor Solutions, Telogy Networks, ATL Research A/S, Libit Signal Processing Ltd., Unitrode Corp., and Power Trends to its arsenal. The firm continued to develop new products as well, including a DSP chip that facilitated high-speed Internet access. Along with leading the DSP market with a 48 percent share, TI held the top position in the analog semiconductor market for the second year in a row. All in all, TI launched 191 analog products in 1999, nearly seven times more than it developed in 1996.
TI entered the new millennium on solid ground. The company's financial performance appeared to be back on track with revenues of $11.8 billion and profits of $2.7 billion. During 2000, the firm purchased Toccata Technology ApS, Burr-Brown Corp., Alantro Communications, and Dot Wireless Inc. It also formed a partnership with Qualcomm Inc. in which both companies were allowed to supply integrated circuits for all wireless standards without infringing on patent rights. TI partnered with four China-based manufacturers to develop and distribute wireless handsets and consumer electronics. The company also teamed up with Imax Corp. to develop digital projectors for movie theaters as well as IMAX theaters. Under the terms of the deal, Imax became the exclusive licensee of TI's DLP Cinema technology.
The tide quickly changed, however, when in the latter half of 2000 and into 2001 the semiconductor industry became embroiled in its worst downturn to date due to high customer inventories and weakening demand. Heavily dependent on that segment, TI's profits began to drop off dramatically and were not expected to return until sometime in 2003. Sales also fell throughout the year, down by as much as 40 percent.
"Despite the challenges," claimed a 2001 Business Week article, "few doubt that TI will remain one of the chip industry's leading players in 2003. TI also has a reputation for excellent service, something that impresses long-term customers looking for more participation and input from suppliers." The company's history of overcoming challenges left Engibous confident that TI would emerge from this downturn successfully. With a strong focus on developing technologies, TI appeared to be well positioned to withstand these hardships.
Principal Subsidiaries: Amati Communications Corporation; Auto Circuits, Inc.; Automotive Sensors & Controls Dresden GmbH (Germany); Benchmarq Microelectronics Corporation of South Korea; Burr-Brown AG (Switzerland); Burr-Brown Europe Limited (England); Burr-Brown Pte Ltd. (Singapore); Butterfly Communications Inc.; European Engineering and Technologies S.p.A. (Italy); Fast Forward Technologies Limited (England and Wales); GO DSP Corporation (Canada); ICOT International Limited (UK); Intelligent Instrumentation GmbH (Germany); Intelligent Instrumentation, Inc.; JMA Information Engineering Ltd.;Power Trends, Inc.; Silicon Systems (Singapore) Pte Ltd.; Telogy Networks, Inc.; Texas Instrumentos Eletronicos do Brasil Limitada; Texas Instruments A/S (Denmark); Texas Instruments Asia Limited; Texas Instruments Automotive Sensors and Controls; Texas Instruments Business Expansion GmbH (Germany); Texas Instruments Canada Limited; Texas Instruments (China) Company Limited; Texas Instruments de Mexico, S.A. de C.V.; Texas Instruments Deutschland GmbH (Germany); Texas Instruments Equipamento Electronicl Lda. (Portugal); Texas Instruments France S.A.; Texas Instruments Holland B.V.; Texas Instruments Hong Kong Limited; Texas Instruments (India) Limited; Texas Instruments Italia S.p.A.; Texas Instruments Japan Limited; Texas Instruments Korea Limited; Texas Instruments Ltd.; Texas Instruments Malaysia Sdn. Bhd.; Texas Instruments Inc. (Philippines); Texas Instruments Singapore (Pte) Ltd.; Texas Instruments Taiwan Ltd. Texas Instruments Limited (United Kingdom); Unitrode Corporation.
Principal Competitors: Analog Devices Inc.; Motorola Inc.; STMicorelectronics N.V.
Market Cap (Mil.): $41,024.09
Shares Outstanding (Mil.): 1,161.17
Annual Dividend: 0.52
Yield (%): 1.47
TXN Industry Sector
P/E (TTM): 13.29 29.29 21.01
EPS (TTM): 60.17 -- --
ROI: 29.20 6.09 16.02
ROE: 31.29 6.30 17.63
Incorporated: 1930 as Geophysical Service, Inc.
Sales: $11.8 billion (2000)
Stock Exchanges: New York Swiss
Ticker Symbol: TXN
NAIC: 334413 Semiconductor and Related Device Manufacturing; 335314 Relay and Industrial Control Manufacturing
1930: Geophysical Service Inc. (GSI) is founded by Karcher and McDermott.
1939: Coronado Corp. is formed as a parent company for GSI.
1941: McDermott, Jonsson, and two GSI employees purchase the GSI from Coronado.
1942: GSI secures military contracts for the U.S. Navy and Army Signal Corps.
1946: Patrick E. Haggerty joins the company; the Laboratory and Manufacturing (L&M) division is created.
1951: The L&M is renamed Texas Instruments Inc. (TI).
1953: TI goes public by merging with the Intercontinental Rubber Company.
1954: Industrial Engineering Associates and TI develop the world's first small portable radio.
1958: Kilby creates the first integrated circuit.
1961: TI builds the first computer to use silicon integrated circuits for the Air Force.
1967: Company engineers invent a hand-held calculator.
1969: IBM begins using integrated circuits in all of its computers.
1970: The single-chip microprocessor is developed.
1976: TI introduces an electronic digital watch that retails for $19.95.
1978: Speak & Spell, an educational device using TI's new speech-synthesis technology, is launched.
1979: The firm begins selling home computers.
1983: TI posts its first-ever loss of $145 million.
1988: The company forms a partnership with Hitachi Ltd. to develop 16-megabit DRAM technology.
1991: The firm joins with Canon, Hewlett-Packard, and the Singapore government to construct a semiconductor facility in Singapore.
1999: Butterfly VLSI Ltd. is acquired.
2001: Sales and profits drop dramatically due to a fallout in the semiconductor industry.
Name Age Since Current Position
Richard Templeton 52 2008 Chairman of the Board, President, Chief Executive Officer
Kevin March 53 2003 Chief Financial Officer, Senior Vice President
Joseph Hubach 53 2000 Senior Vice President, General Counsel, Secretary
Teresa West 50 Senior Vice President
Gregg Lowe 48 2001 Senior Vice President
Melendy Lovett 52 2004 Senior Vice President, President - Education Technology
Kevin Ritchie 54 2004 Senior Vice President
R. Gregory Delagi 48 2007 Senior Vice President
Darla Whitaker 45 2006 Senior Vice President
David Heacock 50 2007 Senior Vice President
Stephen Anderson 49 2008 Senior Vice President
Robert Novak 45 2008 Senior Vice President
John Szczsponik 50 2009 Senior Vice President
Brian Crutcher 38 2010 Senior Vice President
Sami Kiriaki 50 2010 Senior Vice President
Daniel Carp 62 1997 Independent Director
Wayne Sanders 63 1997 Independent Director
Ruth Simmons 65 1999 Independent Director
Christine Whitman 64 2003 Independent Director
Pamela Patsley 54 2004 Independent Director
Carrie Cox 53 2004 Independent Director
Stephen MacMillan 47 2008 Independent Director
Ralph Babb 62 2010 Independent Director
Robert Sanchez 45 2011 Independent Director
12500 TI Boulevard
Dallas, Texas 75243-4136
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