Texas Instruments Inc (NASDAQ:TXN) stock fell 4.90% (As on October 22, 11:41:31 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the third quarter of FY25 but provided a disappointing earnings forecast for the December quarter. The company’s outlook reflects a slowdown in customer orders due to escalating trade tensions and economic instability. After experiencing a demand rebound following two years of downturn, Texas Instruments now faces renewed uncertainty. Regarding third quarter revenue by end market, the industrial market increased about 25% year on year and was up low single digits sequentially following a strong result in the second quarter. The automotive market increased upper single digits year on year and around 10% sequentially with growth across all regions. Personal electronics grew low single digits year on year and grew upper single digits sequentially. Enterprise Systems grew about 35% year on year, grew about 20% sequentially and lastly, communications equipment grew about 45% year on year and was up about 10% sequentially

TXN in the third quarter of FY25 has reported the adjusted earnings per share of $1.48, beating the analysts’ estimates for the adjusted earnings per share of $1.47, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 14 percent to $4.74 billion in the third quarter of FY25, beating the analysts’ estimates for revenue by 2.06%. Gross profit in the quarter was $2.7 billion or 57% of revenue sequentially. Gross profit margin decreased 50 basis points. Operating expenses in the quarter were $975 million, up 6% from a year ago and about as expected on a trailing twelve month basis. Operating expenses were $3.9 billion or 23% of revenue. Operating profit was $1.7 billion in the quarter or 35% of revenue and was up 7% from the year ago quarter. Net income in the quarter was $1.4 billion.

Additionally, Cash flow from operations was $2.2 billion in the quarter and $6.9 billion on a trailing twelve month basis. Capital expenditures were $1.2 billion in the quarter and 4.8 billion dollars over the last twelve months. Free cash flow on a trailing twelve month basis was $2.4 billion. This includes $637 million of CHIPS Act incentives including a $75 million payment received in the third quarter related to the direct funding agreement.

The company anticipates fourth-quarter revenue between $4.22 billion and $4.58 billion, with earnings per share expected to reach $1.26. This contrasts with analysts’ forecasts of $4.5 billion in revenue and $1.39 per share earnings.