Computer chip maker Texas Instruments Inc. expects
first-quarter revenue will be lower than previously projected as a
result of the high-tech economic slowdown and said it is trying to
cut costs with a hiring freeze, temporarily idling some plants and
an early retirement offer.
The company said Monday it expects first-quarter revenue to fall 20 percent
below fourth-quarter results, instead of its previously estimated
10 percent decline. Its fourth-quarter revenue was $3.03 billion.
It offered no earnings projection in the statement.
But it said it had begun a cost reduction plan early in the
quarter "to limit the impact of reduced revenue on
profitability."
The program includes "the temporary idling of manufacturing
facilities and shortened workweeks in some areas," the company
said.
In addition, it said it put "a temporary freeze on hiring, has
significantly cut discretionary expenses such as travel and today
has announced a voluntary retirement program."
Company officials said the continuing economic downturn that has
reduced demand for technology products affected the company in
2000's fourth quarter, with customers reacting to weakening demand
and higher inventories.
"Market conditions have not improved during the quarter and
customers have continued to cancel or reschedule backlog, causing
visibility to remain limited," Texas Instruments said in the
statement.
Company officials have also lowered their capital spending plans
for 2001 to $2 billion, a 30 percent cut from $2.8 billion in the
previous year.
However, research and development investments are increasing to
an estimated $1.7 billion for this year, a boost from $1.6 billion
in 2000, as the company retains one focus in digital signal
processors.
