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Texas Instruments Revises Earnings Forecast
Associated Press
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DALLAS — 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.

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