TI Investor Relations - 2Q12 Mid Quarter Update Reconciliation of Non-GAAP Financial Measure

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Texas Instruments Incorporated
Reconciliation of Non-GAAP Financial Measures

On June 11, 2012, we held a publicly webcast conference call with analysts to discuss our second-quarter 2012 business outlook. During the call, we made the non-GAAP references detailed below. We provided these non-GAAP measures to give investors additional insight into TI's underlying business conditions and results including or excluding some selected items.

Sequential revenue growth rate without the earthquake proceeds in first quarter 2012

We referred to our second-quarter 2012 sequential revenue growth (to the mid-point of the range in our outlook) as being “right around 10%,” excluding the first-quarter 2012 insurance proceeds of about $65 million related to the 2011 Japan earthquake. The table below provides a reconciliation of this non-GAAP item to our first-quarter results prepared in accordance with GAAP.

TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES (Millions of dollars)

	For Three Months Ended



		TI as Reported (GAAP)	Adjustments	TI as Adjusted (Non-GAAP)



Revenue as of March 31, 2012		$ 3,121	(65)	$ 3,056
Revenue as of June 30, 2012 at the mid-point of the outlook range provided		3,350	--	3,350
Sequential revenue growth		7.3%		9.6%

Adjusted five-year average quarterly sequential revenue growth rates

We also made a non-GAAP reference to TI’s five-year average quarterly sequential growth rates, including revenue reported by National Semiconductor (referred to as Silicon Valley Analog or SVA on the conference call) prior to TI’s September 2011 acquisition and excluding revenue associated with TI’s baseband products.

The tables below provide a reconciliation of these non-GAAP sequential growth rates to TI’s average quarterly sequential growth rates as prepared in accordance with GAAP.

TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
(Millions of dollars)

1Q vs. 4Q Five-Year Sequential Growth Rate Average

Revenue as reported (GAAP):

		For Three Months Ended Dec. 31		For Three Months Ended Mar. 31	Sequential Growth Rate

2011/2012	$	3,420	$	3,121	-9%
2010/2011		3,525		3,392	-4%
2009/2010		3,005		3,205	7%
2008/2009		2,491		2,086	-16%
2007/2008		3,556		3,272	-8%

Five-Year Sequential Growth Rate Average					-6%

Plus National Semiconductor (NSC) revenue not included above:

		For Three Months Ended Dec. 31		For Three Months Ended Mar. 31

2011/2012	$	n/a	$	n/a
2010/2011		373		358
2009/2010		345		368
2008/2009		422		292
2007/2008		499		453

Less Baseband revenue included in Revenue as reported (GAAP):

		For Three Months Ended Dec. 31		For Three Months Ended Mar. 31

2011/2012	$	279	$	87
2010/2011		435		334
2009/2010		465		424
2008/2009		464		400
2007/2008		870		720

Revenue as adjusted (Non-GAAP):

		For Three Months Ended Dec. 31		For Three Months Ended Mar. 31	Sequential Growth Rate

2011/2012	$	3,141	$	3,034	-3%
2010/2011		3,463		3,416	-1%
2009/2010		2,885		3,149	9%
2008/2009		2,449		1,978	-19% *
2007/2008		3,185		3,005	-6%

Five-Year Sequential Growth Rate Average					-4%


Five-Year Sequential Growth Rate Average Excluding 1Q09 *					0%

2Q vs. 1Q Five-Year Sequential Growth Rate Average

Revenue as reported (GAAP):

		For Three Months Ended Mar. 31		For Three Months Ended June 30	Sequential Growth Rate

2011	$	3,392	$	3,458	2%
2010		3,205		3,496	9%
2009		2,086		2,457	18%
2008		3,272		3,351	2%
2007		3,191		3,424	7%

Five-Year Sequential Growth Rate Average					8%

Plus NSC revenue not included above:

		For Three Months Ended Mar. 31		For Three Months Ended June 30

2011	$	358	$	383
2010		368		404
2009		292		281
2008		453		462
2007		431		456

Less Baseband revenue included in Revenue as reported (GAAP):

		For Three Months Ended Mar. 31		For Three Months Ended June 30

2011	$	334	$	228
2010		424		416
2009		400		410
2008		720		681
2007		755		788

Revenue as adjusted (Non-GAAP):

		For Three Months Ended Mar. 31		For Three Months Ended June 30	Sequential Growth Rate

2011	$	3,416	$	3,613	6%
2010		3,149		3,484	11%
2009		1,978		2,328	18%
2008		3,005		3,132	4%
2007		2,867		3,092	8%

Five-Year Sequential Growth Rate Average					9%

3Q vs. 2Q Five-Year Sequential Growth Rate Average

Revenue as reported (GAAP):

		For Three Months Ended June 30		For Three Months Ended Sept. 30	Sequential Growth Rate

2011	$	3,458	$	3,466	0%
2010		3,496		3,740	7%
2009		2,457		2,880	17%
2008		3,351		3,387	1%
2007		3,424		3,663	7%

Five-Year Sequential Growth Rate Average					6%

Plus NSC revenue not included above:

		For Three Months Ended June 30		For Three Months Ended Sept. 30

2011	$	383	$	315
2010		404		401
2009		281		314
2008		462		466
2007		456		472

Less Baseband revenue included in Revenue as reported (GAAP):

		For Three Months Ended June 30		For Three Months Ended Sept. 30

2011	$	228	$	263
2010		416		438
2009		410		450
2008		681		673
2007		788		857

Revenue as adjusted (Non-GAAP):

		For Three Months Ended June 30		For Three Months Ended Sept. 30	Sequential Growth Rate

2011	$	3,613	$	3,518	-3%
2010		3,484		3,703	6%
2009		2,328		2,744	18%
2008		3,132		3,180	2%
2007		3,092		3,278	6%

Five-Year Sequential Growth Rate Average					6%

4Q vs. 3Q Five-Year Sequential Growth Rate Average

Revenue as reported (GAAP):

		For Three Months Ended Sept. 30		For Three Months Ended Dec. 31	Sequential Growth Rate

2011	$	3,466	$	3,420	-1%
2010		3,740		3,525	-6%
2009		2,880		3,005	4%
2008		3,387		2,491	-26%
2007		3,663		3,556	-3%

Five-Year Sequential Growth Rate Average					-6%

Plus NSC revenue not included above:

		For Three Months Ended Sept. 30		For Three Months Ended Dec. 31

2011	$	315	$	n/a
2010		401		373
2009		314		345
2008		466		422
2007		472		499

Less Baseband revenue included in Revenue as reported (GAAP):

		For Three Months Ended Sept. 30		For Three Months Ended Dec. 31

2011	$	263	$	279
2010		438		435
2009		450		465
2008		673		464
2007		857		870

Revenue as adjusted (Non-GAAP):

		For Three Months Ended Sept. 30		For Three Months Ended Dec. 31	Sequential Growth Rate

2011	$	3,518	$	3,141	-11%
2010		3,703		3,463	-6%
2009		2,744		2,885	5%
2008		3,180		2,449	-23% *
2007		3,278		3,185	-3%

Five-Year Sequential Growth Rate Average					-8%


Five-Year Sequential Growth Rate Average Excluding 4Q08 *					-4%