Texas Instruments Incorporated (NASDAQ: TXN) stock fell 1.17% though the company posted better than expected results for the fourth quarter of 2018. In the fourth quarter, the cash flow from operations is $2.1 billion. Free cash flow for the trailing 12-month period rose 30% to $6.1 billion from a year ago. Free cash flow margin for the same period is 38.4% of revenue, up from 31.2% a year ago. Gross profit in the quarter was $2.41 billion, or 64.8% of revenue. From a year ago, gross profit decreased primarily due to lower revenue and reduced factory loadings. Gross profit margin decreased 30 basis points.
TXN in the fourth quarter of FY 18 has reported the adjusted earnings per share of $1.24, beating the analysts’ estimates for the adjusted earnings per share of $1.23, according to data compiled from analysts polled by FactSet. The company had reported the adjusted revenue of $3.72 billion in the fourth quarter of FY 18, beating the analysts’ estimates for revenue of $3.7 billion.
Moreover, in the core businesses, Analog revenue rose 4% and Analog Processing declined 12% compared with the same quarter a year ago, both businesses growth decelerated. Operating margin decreased in both businesses, and similar to the third quarter, Embedded remained weaker than Analog, primarily because Analog benefited from increasing content in 5G, while the weaknesses in other markets became more pronounced in Embedded. From a year ago quarter, Analog revenue rose 4% due to Signal Chain and Power, partially offset by declines in High Volume. Embedded Processing revenue fell 12% from the year ago quarter due to declines in both product lines, Processors and Connected Microcontrollers. In the other segment, revenue declined $31 million from the year ago quarter. For the year in total, Analog and Embedded grew 9% and 2%, respectively, and combined were 91% of TXN’s revenue.
In 2018, the company has returned $7.7 billion in cash to owners through a combination of dividends and stock repurchases.
For its first quarter of the FY 19, Texas Instruments expects its earnings to be in the range of $1.03 to $1.21 per share, while analysts see this figure as being roughly $1.20 per share. The company is expecting revenue to be in the range of $3.34 billion to $3.62 billion, which has a midpoint guidance below the $3.6 billion that Wall Street is forecasting.