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    Texas Instrument to close plants in Houston, Japan

    Associated Press – Mon, Jan 23, 2012

    DALLAS (AP) — Texas Instruments will close two of its older computer-chip factories, one in Houston and one in Hiji, Japan, and lay off about 1,000 workers to cut costs.

    The company announced the cutbacks Monday in its fourth-quarter earnings report. Its results topped analyst estimates, but the company offered tepid forecast for the first quarter of this year.

    Texas Instruments shares gained $1.11, or more than 3 percent, to $34.30 after the earnings and layoff announcements.

    The planned layoffs represent about 3 percent of the 34,800 workers that Texas Instruments Inc. employed as of Sept. 30. Texas Instruments picked up about 5,000 additional workers four months ago when it completed its $6.5 billion acquisition of another chip maker, National Semiconductor.

    Closing the two factories will save Texas Instruments about $100 million annually. The Houston plant is 42 years old while the Japan factory opened 32 years ago. The closures are to occur in the next 18 months. Production will be shifted to other Texas Instruments plants.

    Texas Instruments will absorb $215 million in charges to pay for the closures. About $112 million of that amount was recorded in the fourth quarter. The remainder will be scattered through 2013.

    Despite the charges, Texas Instruments still fared better in October through December than analysts and its own management anticipated.

    CEO Rich Templeton said the pleasant surprise stemmed from improving demand for most of the company's products, leading him to believe that the company is moving beyond a downturn that undercut its financial performance for most of last year.

    The company, which is based in Dallas, earned $298 million, or 25 cents per share, in the fourth quarter. That was a 68 percent drop from net income of $942 million, or 70 cents per share, at the same time in 2010.

    Wall Street had been bracing for a steeper decrease to 23 cents per share, according to FactSet.

    The past quarter's earnings were lowered by a charge of 16 cents per share to account for the residue of National Semiconductor and the plant closure charge, which worked out to 7 cents per share for the period.

    Fourth-quarter revenue dipped 3 percent from the previous year to $3.42 billion, but was about $160 million high than analysts forecast on average.

    The company projected its earning per share for the three months ending in March will range from 16 cents to 24 cents. Analysts had been expecting 32 cents per share. Texas Instruments believes its first-quarter revenue will range from $3 billion to $3.28 billion. Analysts projected first-quarter revenue of $3.22 billion, according to FactSet.

     

    18 comments

    • Toney Danza
      Toney Danza  •  Tyler, Texas  •  3 mths ago
      seems like a good decision. im starting to feel better about buying my new graphing calculator.
    • N. G.
      N. G.  •  4 mths ago
      $10 bucks Texas Instruments is shifting production to some third world nation. They ought to change their name to "China Instruments".
      • Lyle
        Lyle 4 mths ago
        They currently have factories all over the world, including third world countries. What's your point? (I actually worked for the company for over 10 years. It was a great employer)
    • we're screwed
      we're screwed  •  4 mths ago
      My first calculator was made by Texas Instruments and Im sure it was made in the USA. How sad that America has become bereft of skilled jobs, unless you count white collar thievery. Its about the only thing American companies do well anymore.
      • Pikachu B
        Pikachu B 4 mths ago
        There's no skill in assembling computer parts. This is generally true in all assemblage, whether it's motors or space shuttles. Why else do you think it's outsourced to countries like China?
    • Sir_Roxalott
      Sir_Roxalott  •  Yucca, Arizona  •  4 mths ago
      The real Headline should read:
      Texas Instruments has been outsourcing jobs to China for 32 years!
    • themerryprankster
      themerryprankster  •  Honolulu, Hawaii  •  4 mths ago
      Good job, Rick Perry. Guess Houston didn't need those jobs.
      • BVAS1430
        BVAS1430 4 mths ago
        That idiot has no clue about jobs creation, even though he was runnung on that platform.
        He also got crossways with the most powerful man in the world:
        The President of the United States of America.
        And it's costing Texas.
      • themerryprankster
        themerryprankster 4 mths ago
        @BVAS1430: I lived in Houston from late 2000 into the middle of 2005. I still can't figure out how he beat out Kay Bailey Hutchinson, unless the sole determining factor was that he was, technically, the incumbent. I'm not a Republican, but Hutchinson is a pretty sharp person.
    • weeniedawg
      weeniedawg  •  Santa Rosa Beach, Florida  •  4 mths ago
      Sweat shop labor is cheaper than Union labor.
    • OldDan
      OldDan  •  4 mths ago
      Lemme see, the CEO and CFO will get a bonus for saving the company money by moving the jobs to China. Got it.
    • BVAS1430
      BVAS1430  •  Houston, Texas  •  4 mths ago
      Don't you all just love this "news reporting" today?
      "The manufacturing will be done at other Texas Instruments plants"
      Where?
      Are these jobs being outsourced overseas?
      TI, as per this report, closed a plant in Japan.
      Are they opening two new ones in China or India?
      Labor is a lot cheaper in China and India than in the U.S. and Japan.
      Investigative reporting is a thing of the past. We also get reports in English with amounts in Euros and British English spellings.
      Our Founding Fathers are turning over in their graves.
    • SRV
      SRV  •  4 mths ago
      I guess they need money to pay bonuses to the board?
      • MikeyPooh
        MikeyPooh 4 mths ago
        no, they need money to send to China to restart the factories there. if the factory here actually made money they would already have bonuses.
      • DARKSKY
        DARKSKY 4 mths ago
        I worked for TI. Sure the executives get bonuses, but so do the workers. I was just a machine operator and would get a bonus of over two grand every Christmas. Also got a couple hundred dollars every quarter, depending on how well TI was doing, as part of stock options that ALL employees got. Also got a bonus if I reported a safety problem or a problem with a machine that could affect production. And to top it off, they paid well and had excellent health coverage! No, I have no complaints about TI.
    • BoredStiff
      BoredStiff  •  4 mths ago
      But th plants in China will be increasing production by a third.
    • John
      John  •  Cleveland, Ohio  •  4 mths ago
      What plants will this "original American " company keep open ? Goodbye Skilled Jobs ! ! !
    • Marc
      Marc  •  4 mths ago
      A 42-year old HP factory in Houston had served them well for almost half a century and should be modernized instead of closing and transferring the plant to other countries.
    • BVAS1430
      BVAS1430  •  Houston, Texas  •  4 mths ago
      You are missing the point, #$%$Americans jobs are being outsourced overseas for cheaper labor, then the products return to the U.S. and are sold as if made here, then Bush and his cronies added low tariffs, and of course, the infamous tax breaks for those "creating jobs", with no mention that those jobs were and are being created overseas.Do you all see those Chinese and Indian smiling faces?Those used to be American smiling faces.That's where America is getting ripped off. Not on the agricultural fields by illegal aliens.Wake up.
    • DR
      DR  •  4 mths ago
      I'm glad were in a recovery! DUH!
    • D.C. Dave
      D.C. Dave  •  Tampa, Florida  •  4 mths ago
      The only way to keep jobs here is to stop buying things made there.

      Stop buying products made in China; ... like iphones.
      • bee mee
        bee mee 4 mths ago
        If you read this, they are closing plants in Houston and Japan, there are very few items that you buy nowadays that are made completely in one country, including "TEXAS" Instruments.
      • A Yahoo! User 4 mths ago
        Start revoking patents held by companies that have all these jobs in other countries such as China.
    • DARKSKY
      DARKSKY  •  Lubbock, Texas  •  4 mths ago
      I worked at TI's Lubbock site for several years before they closed it. They treat their people well, continued to give me full pay and health insurance for six months after closing as part of the severence package. They also helped me write resumes and gave me job leads. I jumped on the opportunity to take the post office test and started my background investigation as soon as I heard TI was closing (2 months before actually closing), so just a few days after being terminated I got a letter from the USPS saying I had been accepted. The post office pays well, they pay the same whether you live in a low cost of living area (as I do), or high cost area (such as New York). I give myself credit for getting off of my butt and looking for a new (better) job instead of collecting meager unemployment benefits. My point is, there are still plenty of opportunities out there, just get off your butt and look for them instead of relying on welfare. I am now retired and get two nice retirement checks the first of the month and a good social security check the third Wednesday of the month. I now get more money each month than I ever did when working. Don't depend on any President to keep you employed, DO IT YOURSELF!
    • A Yahoo! User  •  4 mths ago
      Oh no, we've angered our Holy Job Creators! Quick, sacrifice a darkie to Reagan and repent!
    • Dave
      Dave  •  4 mths ago
      These editors sure know to tease a feller into reading their stuff. I started to read the article because I did not know there was a burg in Japan named Houston.
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