Texas Instruments 2011 Annual Report Download - page 49

TEXAS INSTRUMENTS 2011 ANNUAL REPORT ■ 47
ANNUAL
REPORT
Wireless
2010 2009 2010 vs. 2009
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,978 $2,626 13%
Operating profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 683 315 117%
Operating profit % of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.9% 12.0%
Restructuring charges* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10 $ 62
* Included in operating profit
Wireless revenue increased $352 million, or 13 percent, from 2009 primarily due to increased shipments of connectivity products, and
to a lesser extent, OMAP applications processors. Baseband revenue for 2010 was $1.71 billion, about even compared with 2009.
Operating profit was $683 million, or 22.9 percent of revenue. This was an increase of $368 million, or 117 percent, compared with
2009 primarily due to higher revenue and associated gross profit.
Other
2010 2009 2010 vs. 2009
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,936 $2,128 38%
Operating profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,464 712 106%
Operating profit % of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.9% 33.5%
Restructuring charges* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4 $ 23
Acquisition charges/divestiture (gain)* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (144 ) —
* Included in operating profit
Revenue from Other was $2.94 billion in 2010. This was an increase of $808 million, or 38 percent, from 2009 primarily due to
increased shipments of DLP products and, to a lesser extent, custom ASIC products. Also contributing to the increase in revenue were
higher royalties, and revenue from transitional supply agreements associated with recently acquired factories and from increased
shipments of calculators.
Operating profit for 2010 from Other was $1.46 billion, or 49.9 percent of revenue. This was an increase of $752 million, or
106 percent, compared with 2009 due to higher revenue and associated gross profit and, to a lesser extent, the gain on the sale of a
product line.
Financial condition
At the end of 2011, total cash (Cash and cash equivalents plus Short-term investments) was $2.94 billion, a decrease of $137 million
from the end of 2010.
Accounts receivable were $1.55 billion at the end of 2011. This was an increase of $27 million compared with the end of 2010.
Days sales outstanding were 41 at the end of 2011 compared with 39 at the end of 2010. The increase in accounts receivable was due
to higher revenue in December 2011 than in December 2010.
Inventory was $1.79 billion at the end of 2011. This was an increase of $268 million from the end of 2010. Days of inventory at
the end of 2011 were 86 compared with 83 at the end of 2010. The increase in inventory was primarily due to rebuilding inventory to
support higher customer service levels with shorter lead times, as well as inventory associated with the National acquisition.
Liquidity and capital resources
Our primary source of liquidity is cash flow from operations. Additional sources of liquidity are cash and cash equivalents, short-term
investments, and revolving credit facilities. Cash flow from operations for 2011 was $3.26 billion, a decrease of $564 million from the
prior year due to lower net income.
We had $992 million of cash and cash equivalents and $1.94 billion of short-term investments as of December 31, 2011.
We have a variable-rate revolving credit facility that allows us to borrow up to $920 million until August 2012. We have a second
variable-rate revolving credit facility that allows us to borrow an additional $1 billion until July 2012. We intend to replace these credit
facilities in 2012.