Shares of semiconductor veteran Texas Instruments (TXN -0.05%) gained 11.1% in April 2019, according to data from S&P Global Market Intelligence. The company posted a relatively solid fourth-quarter report last month, beating analyst estimates across the board.
TI's earnings fell 7% year over year, to $1.26 per diluted share, while revenues dipped 5.2%, to $3.59 billion. Your average Wall Street analyst would have settled for earnings near $1.13 per share on revenues in the neighborhood of $3.5 billion.
This wasn't a huge surprise, but every little victory counts when the entire semi industry is under constant geopolitical pressure. Moreover, TI is already reporting decent order volumes in the market for 5G wireless products. In the end, CFO Rafael Lizardi expects the lean market prospects to turn more positive across the chip sector, a couple of quarters down the road.
Lizardi said in the fourth-quarter earnings call:
We believe that after 10 quarters of year-on-year growth, the weakness we're seeing is primarily due to the semiconductor cycle. We have just completed our second quarter of year-on-year declines for TI. If you look at history, cycles are always different, but typically the industry would have four to five quarters of year-on-year declines before year-on-year growth resumes.