Texas Instruments 2009 Annual Report Download - page 41

TEXAS INSTRUMENTS 2009 ANNUAL REPORT PAGE 39
The tax provision was $547 million, compared with $561 million for the prior year. The decrease was primarily due to lower income
before income taxes, partially offset by lower discrete tax benefits, and to a lesser extent, a lower federal R&D tax credit. The tax
provision for 2009 contained net discrete tax benefits of $7 million. The tax provision for 2008 contained net discrete tax benefits of
$122 million, primarily resulting from our decision to indefinitely reinvest the accumulated earnings of a non-U.S. subsidiary. See Note 5
to the Financial Statements for a reconciliation of tax rates to the statutory federal tax rate.
Our annual effective tax rate for 2010 is estimated to be about 31 percent, an increase from 27 percent in 2009 primarily due to
higher income before income taxes. The estimated tax rate is based on the current tax law in effect and does not assume reinstatement
of the federal R&D tax credit, which expired on December 31, 2009.
Income from continuing operations was $1.47 billion, a decrease of $450 million from 2008. EPS for 2009 was $1.15 per share,
compared with $1.44 per share for 2008. See Note 1 for a discussion of the effect of the adoption of a new accounting standard on
previously reported EPS. EPS in 2009 benefited $0.05 from a lower number of average shares outstanding as a result of our stock
repurchase program.
Orders were $11.36 billion, which was 4 percent lower than 2008. The decline reflected lower demand for baseband wireless
products.
Segment results
A detailed discussion of our segment results appears below. When reviewing each segment’s results, bear in mind that restructuring
charges negatively impacted each segment’s operating profit as follows:
2009 2008
Analog . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 87 $ 60
Embedded Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 24
Wireless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 130
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 40
Total restructuring. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $212 $ 254
Analog
2009 2008
2009
vs. 2008
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,270 $4,857 -12%
Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 753 1,050 -28%
Operating profit % of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.6%21.6%
Analog revenue declined $587 million, or 12 percent, from 2008 primarily due to lower shipments of high-volume analog & logic
products. Also contributing to the decline, but to a lesser extent, was high-performance analog, where although shipments were
about flat compared with 2008, revenue fell due to a higher proportion of shipments of lower-priced products. Revenue from power
management products was about flat.
Operating profit was $753 million, or 17.6 percent of revenue. This was a decrease of $297 million from 2008 due to lower revenue
and associated lower gross profit, partially offset by lower operating expenses.
Embedded Processing
2009 2008
2009
vs. 2008
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,471 $ 1,631 -10%
Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 194 268 -28%
Operating profit % of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.2%16.5%
Embedded Processing revenue declined $160 million, or 10 percent, compared with 2008 primarily due to lower revenue from catalog
products. The decline in catalog revenue was primarily due to a higher proportion of shipments of lower-priced products. Lower
shipments of products for automotive applications contributed to a lesser extent to the segment’s revenue decline.
Operating profit was $194 million, or 13.2 percent of revenue. This was a decrease of $74 million, or 28 percent, compared with
2008 due to lower revenue and associated lower gross profit, partially offset by lower operating expenses.