d8k01212014.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549




FORM 8-K
 
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): January 21, 2014

 

TEXAS INSTRUMENTS INCORPORATED
(Exact name of registrant as specified in charter)
 
         
DELAWARE
  
001-03761
  
75-0289970
(State or other jurisdiction of incorporation)
  
(Commission file number)
  
(I.R.S. employer identification no.)
 
12500 TI BOULEVARD
P.O. BOX 660199
DALLAS, TEXAS 75266-0199
(Address of principal executive offices)
 
Registrant’s telephone number, including area code: (214) 479-3773



 
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

 

 
 
 

ITEM 2.02.  Results of Operations and Financial Condition

The Registrant’s news release dated January 21, 2014, regarding its fourth-quarter and 2013 results of operations and financial condition is attached hereto as Exhibit 99.

The attached news release includes references to the following financial measures that were not prepared in accordance with generally accepted accounting principles in the United States (non-GAAP measures):  free cash and various ratios based on free cash flow.  The company believes these non-GAAP measures provide insight into its liquidity, cash generating capability and the amount of cash available to return to investors, as well as insight into its financial performance.  These non-GAAP measures are supplemental to the comparable GAAP measures.  Reconciliation to the most directly comparable GAAP measures is included in the “Non-GAAP financial information” section of the news release.

ITEM 2.05.  Costs Associated with Exit or Disposal Activities
 
The Registrant announced today that it will reduce costs in Embedded Processing and in Japan.  Cost reductions include the elimination of about 1,100 jobs worldwide.  The Registrant estimates that this action will be substantially complete by the middle of 2015.

Total charges for this action are estimated to be about $80 million, of which $49 million was included in the fourth quarter of 2013 and about $30 million will be included in the first quarter of 2014.  All of the estimated charges are for severance and related benefits and will result in future cash expenditures.

As a result of this action, the Registrant expects annualized savings of about $130 million by the end of 2014.

ITEM 9.01. Exhibits
 
Designation
of Exhibit
in this
Report
  
Description of Exhibit
99
  
Registrant’s News Release
 
  
Dated January 21, 2014 (furnished pursuant to Item 2.02)
 

Safe Harbor Statement

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995:
 
This report includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995.  These forward-looking statements generally can be identified by phrases such as TI or its management “believes,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of similar import.  Similarly, statements herein that describe TI’s business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements.  All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements.
 
We urge you to carefully consider the following important factors that could cause actual results to differ materially from the expectations of TI or its management:

·  
Market demand for semiconductors, particularly in markets such as industrial, automotive, personal electronics, communications equipment and enterprise systems;
·  
TI’s ability to maintain or improve profit margins, including its ability to utilize its manufacturing facilities at sufficient levels to cover its fixed operating costs, in an intensely competitive and cyclical industry;
·  
TI’s ability to develop, manufacture and market innovative products in a rapidly changing technological environment;
·  
TI’s ability to compete in products and prices in an intensely competitive industry;
·  
TI’s ability to maintain and enforce a strong intellectual property portfolio and obtain needed licenses from third parties;
·  
Expiration of license agreements between TI and its patent licensees, and market conditions reducing royalty payments to TI;
·  
Economic, social and political conditions in the countries in which TI, its customers or its suppliers operate, including security risks, health conditions, possible disruptions in transportation, communications and information technology networks and fluctuations in foreign currency exchange rates;
·  
Natural events such as severe weather and earthquakes in the locations in which TI, its customers or its suppliers operate;
·  
Availability and cost of raw materials, utilities, manufacturing equipment, third-party manufacturing services and manufacturing technology;
·  
Changes in the tax rate applicable to TI as the result of changes in tax law, the jurisdictions in which profits are determined to be earned and taxed, the outcome of tax audits and the ability to realize deferred tax assets;
·  
Changes in laws and regulations to which TI or its suppliers are or may become subject, such as those imposing fees or reporting or substitution costs relating to the discharge of emissions into the environment or the use of certain raw materials in our manufacturing processes;
·  
Losses or curtailments of purchases from key customers and the timing and amount of distributor and other customer inventory adjustments;
·  
Customer demand that differs from our forecasts;
·  
The financial impact of inadequate or excess TI inventory that results from demand that differs from projections;
·  
Impairments of our non-financial assets;
·  
Product liability or warranty claims, claims based on epidemic or delivery failure or recalls by TI customers for a product containing a TI part;
·  
TI’s ability to recruit and retain skilled personnel;
·  
Timely implementation of new manufacturing technologies and installation of manufacturing equipment, and the ability to obtain needed third-party foundry and assembly/test subcontract services;
·  
TI’s obligation to make principal and interest payments on its debt;
·  
TI’s ability to successfully integrate and realize opportunities for growth from acquisitions, and our ability to realize our expectations regarding the amount and timing of restructuring charges and associated cost savings; and
·  
Breaches of our information technology systems.

For a more detailed discussion of these factors, see the Risk Factors discussion in Item 1A of TI’s Form 10-K for the year ended December 31, 2012.  The forward-looking statements included in this report are made only as of the date of this report, and TI undertakes no obligation to update the forward-looking statements to reflect subsequent events or circumstances.

 
 
 


SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
         
 
  
TEXAS INSTRUMENTS INCORPORATED
 
     
Date: January 21, 2014
  
By:
  
/s/ KEVIN P. MARCH
 
  
  
  
Kevin P. March
 
  
  
  
Senior Vice President and
 
  
  
  
Chief Financial Officer