Texas Instruments provides a grim outlook that indicates growing pains for chipmakers.

As an economic slump threatens to stifle demand from the chipmaker's so far strong markets, Texas Instruments estimated first-quarter sales and profit on Tuesday that will be significantly below Wall Street estimates.

Total revenue of Texas Instruments fell 3% to $4.67 billion in the quarter, compared with estimates

Jan 24 (Reuters) - Texas Instruments (TXN.O) forecast first-quarter revenue and profit largely below Wall Street targets on Tuesday, as an economic downturn threatens to shackle demand from the chipmaker's so far resilient markets.

Smartphones and personal computing products were the first to feel the pinch of customers cutting back on discretionary spending as interest rates rose, but segments such as industrial have started to come under pressure.

On Tuesday, Texas said revenue in its industrial business fell 10% in the fourth quarter from the previous period, while it plunged 20% in its communications equipment and enterprise systems businesses.

Order cancellations rose during the fourth quarter, head of investor relations Dave Pahl told analysts in an earnings call.

The company said it expects "weaker than seasonal decline" in demand during the current quarter as customers preferred to reduce their inventory pile.

"TI's results show that even the more resilient analog markets are beginning to show weakness," Edward Jones analyst Logan Purk said.


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