Texas Instruments Booth at The 6th CIIE in Shanghai

Visitors are visiting various integrated-circuit chips developed and produced by Texas Instruments at the Sixth China International Import Expo (Costfoto/Getty Images)

Texas Instruments slumps as chip demand keeps “hovering at the bottom”

The chipmaker beat on earnings, but like SK Hynix, investors are putting more weight on its less-than-stellar outlook than the recent past.

Luke Kawa

1/24/25 9:50AM

Texas Instruments is one of the worst-performing S&P 500 constituents in early trading as management warned that first-quarter profits would likely come in well below what Wall Street had penciled in.

The chipmaker, which people of a certain vintage most associate with the big graphing calculators we lugged around in high school, posted fourth-quarter results that beat analysts’ expectations on the top and bottom lines. But, like SK Hynix, investors are putting more weight on its less-than-stellar outlook than the recent past.

The divergence in demand for chips for AI (good) versus ex-AI (not good) that management teams across the industry have been highlighting for many quarters is ongoing, a trend underscored by Texas Instruments’ guidance.

The company, which has seen sales slip year on year for nine consecutive quarters, has testified to the prolonged period of seeing demand “hovering at the bottom” in its key markets.

“If I start with the industrial market, as I described, I think, during the last call, most of the sectors are kind of hovering at the bottom, maybe found the bottom,” President and CEO Haviv Ilan said on a conference call following the release of the results.

In the previous earnings call, Ilan said, “We are seeing — most of the sectors I would characterize are — have found the bottom, but are kind of hovering at that bottom.”

This persistent divide in demand within the industry speaks to a conundrum: AI is supposed to be sufficiently revolutionary so as to drive upgrade cycles across different end markets and lift all boats for demand. Instead, we’re seeing concentrated pockets of strength on the one hand and a U-shaped bottom in many key markets on the other, with the upward-sloping end of that letter a seemingly elusive hope.

(This point is a little less pertinent when it comes to Texas Instruments in particular, whose sales are more industrial and automotive centric than consumer electronics focused, but still holds for semis generally.)

The significant underperformance of Apple’s stock as of late can be viewed as an extension of this dynamic.

Max Knoblauch9h

Nike’s China business declines for seventh straight quarter

Sportswear kingpin Nike reported results for its third quarter, which ended in February, after the bell Tuesday. The stock fell about 3% in after-hours trading.

For fiscal Q3, Nike reported:

Earnings of $0.35 per share, comfortably above the Wall Street consensus of $0.29 per share compiled by FactSet.
$11.28 billion in total revenue, roughly in line with the $11.26 billion estimate.

Nike’s sales in China — where the company earns about 15% of its revenue — fell 7% to $1.62 billion. That’s its seventh straight quarter of sales declines in the market, though this quarter’s was less than feared. The company had issued weak guidance for this quarter considering continued softness in the region.

“This quarter we took meaningful actions to improve the health and quality of our business,” said Nike CEO Elliott Hill. “The pace of progress is different across the portfolio and the areas we prioritized first continue to drive momentum.”

Nike shares are trading near decade lows this month, as tariffs continue to weigh on profits and shipping costs rise amid the war with Iran. As of Tuesday’s close, the stock was down 17% year to date.

Luke Kawa, Tasha Matsumoto

10h

Stocks end worst quarter since 2022 with best day since May

Optimism that the end of the war may be near sent stocks surging.

Max Knoblauch11h

Oil-sensitive travel stocks pop following Iran state media reporting on potential war resolution

Travel stocks are surging on Tuesday as oil prices fall following reports from Iranian state media that President Masoud Pezeshkian said the country has “the necessary will to end this war,” but would only do so with guarantees that “prevent the recurrence of aggression.”

The war has sent oil prices and refining margins surging this month, causing airlines and cruise lines to cut profit forecasts despite reported high demand.

Following Tuesday’s update, shares of the big four US airlines (Delta Air Lines, United Airlines, American Airlines, and Southwest Airlines) all climbed, along with smaller rivals including JetBlue. US airlines have stopped fuel hedging in recent years, increasing their exposure to upward swings in oil prices.

Cruise stocks also rallied, with Carnival and Norwegian up more than 6% and Royal Caribbean up about 5%.

J. Edward Moreno14h

The FDA is expected to lift restrictions on certain peptides, the NYT reports

The Food and Drug Administration is expected to lift restrictions on certain peptides, allowing the experimental, often injectable substances to be sold by compounding pharmacies, The New York Times reported Tuesday.

The potential move was previously reported by The Wall Street Journal, and teased by Health Secretary Robert F. Kennedy Jr. on the “Joe Rogan Experience” podcast in late February.

Peptides have boomed in popularity recently, with search interest for “peptides” surpassing “ozempic” this month. Many of them are currently understudied and not approved for human use, a rule consumers are able to bypass by purchasing them from suppliers that sell them for, ostensibly, research purposes only.

As reports of the FDA changing its stance of peptides mount, consumer health companies like Hims & Hers and Superpower have been getting ready to roll out their peptide offerings as soon as they get the FDA's blessing.

The peptide gold rush: How impending deregulation could supercharge a shadow industry

Matt Phillips15h

Memory stocks bounce as Bernstein analyst calls TurboQuant fears “overdone”

Memory stocks rose Tuesday, after Bernstein analysts called the recent panic over Google’s TurboQuant AI algorithm “overdone.”

Bernstein analyst Mark Newman wrote:

“[Hard disk drive] and Memory stocks have sold off significantly due in part to fears from Google’s TurboQuant report. This however, should have zero impact on HDD demand and negligible impact on NAND demand. Given the stock sell-off we see this as an attractive entry point for Seagate Technology Holdings, Western Digital and Sandisk’s and upgrade WDC to Outperform.”

All three stocks were up early Tuesday, as was memory chip maker Micron.

Today’s rally stands in stark contrast to the pummeling these shares have endured over the last week, after Google Research published a technical paper on March 24 detailing its TurboQuant AI algorithm, which compresses the amount of data associated with AI operations without affecting the accuracy of AI models.

That was seen as a threat to surging AI demand for memory storage, which has supercharged prices for memory chips and memory-related stocks over the last year.