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TI ANALYST MEETING HIGHLIGHTS MAJOR TRANSITIONS ACROSS TI'S BUSINESSES AND DETAILS 1992 ECONOMIC AND SEMICONDUCTOR MARKET FORECAST

TI ANALYST MEETING HIGHLIGHTS MAJOR TRANSITIONS ACROSS TI'S BUSINESSES
      AND DETAILS 1992 ECONOMIC AND SEMICONDUCTOR MARKET FORECAST
    DALLAS, Feb. 27 /PRNewswire/ -- At its meeting held annually in Dallas for financial analysts, Texas Instruments (NYSE: TXN) today presented its global economic outlook and forecast for semiconductor market growth.  In a series of panel presentations, TI managers also explained the major transitions taking place across the company's businesses.  These changes are leading TI toward closer customer relationships and higher value-added solutions.
    TI's outlook for 1992 is based on conservative growth estimates for the major economies and markets of the world.  The global economy is expected to grow 1.5 percent in 1992.  With little anticipated improvement in economic and market growth in the near term, TI's performance is the key to returning the company to profitability in 1992.
    TI said the semiconductor market outlook for the United States is gradually strengthening, and the company expects the U.S. market to show growth of 11 percent in 1992.  Semiconductor market growth in Europe is expected to be 7 percent.  The Asia-Pacific region should remain the highest growth region at 18 percent.  In view of the current slowdown in the Japanese economy, the semiconductor market for Japan is expected to grow only 3 percent in 1992.  Overall, the worldwide semiconductor market is expected to grow about 8 percent to $59 billion in 1992, with stronger growth going into 1993.
    SEMICONDUCTOR
    In its semiconductor presentations, TI reviewed the company's strategy and progress in transitioning this business to a higher mix of differentiated semiconductor products, as well as the company's progress in expanding its global submicron CMOS manufacturing capacity.  In addition, cost-reduction and yield- improvement programs were highlighted, along with the benefit of production ramp-up of new capacity, as key factors for improvement in semiconductor financial performance.
    Gaining market share with double-digit growth in 1991, TI's application-specific products business has emerged as the largest part of its  semiconductor operation.  Differentiated products (largely made up of application-specific products) accounted for more than 35 percent of semiconductor revenues, with a goal of greater than 50 percent later this decade.  TI said it is acknowledged as the worldwide market leader in digital signal processors, is the largest merchant supplier of standard cells, and achieved record revenue growth in 1991 in the fast- growing mixed-signal market.
    As a result of significant countercyclical investments, TI's CMOS capacity will match the industry's average of 70 percent in 1992.  Over the next five years, the submicron CMOS capacity available to TI will increase by a factor of about eight.
    TI's strategy is to bring on new capacity quickly using advanced memory chips and convert a portion of production to differentiated products to support customer requirements.  By harmonizing equipment, tooling and recipes at each of the different factories, TI can manufacture both memory and next-generation logic products at each factory, producing competitive products with maximum resource efficiency and flexibility.
    TI currently is in volume production of submicron CMOS 4-megabit DRAMs.  TI's Avezzano, Italy, facility is ramping into volume production of 4-megabit DRAMs, while the TI-ACER joint venture in Taiwan recently began shipments of 4-megabit DRAMs.  Additional joint-venture fabs are under construction in Japan and Singapore.  When fully operational, the total new capacity has the potential to add more than $1 billion annually in semiconductor revenues.
    TI expects to be one of the early leaders on the 16-megabit DRAM, which has recently completed internal qualification tests. Initial shipments of production devices are planned to begin in the second half of 1992 from TI's MOS memory facility in Dallas. TI plans to apply the 0.5-micron technology used in the 16-megabit memory chip to further shrink its 4-megabit device, which will contribute to reduced costs.
    DEFENSE ELECTRONICS
    Management from TI's Defense Systems & Electronics Group explained how the changes in the global defense environment have affected TI's business and the steps the company is taking to keep this business competitive.
    During 1991, TI received more than $400 million of new orders for replenishment of high-speed antiradiation missiles (HARM) and laser- guided weapons used in Operation Desert Storm.  TI expects to receive additional replenishment orders of approximately $400 million in 1992.
    TI is continuing to win new programs for the future, such as the U.S.  Navy's Advanced Interdiction Weapon System, which is a next- generation missile system that is planned to replace six air-to-ground weapon systems in the U.S. inventory.  This program has the potential to be as important to TI as the HARM program has been.
    TI's defense business is making the cost reductions with ongoing resource consolidations and organizational realignments to remain a stable contributor to TI in a smaller defense market.
    INFORMATION TECHNOLOGY
    Presentations on TI's information technology business explained how TI is moving from a hardware focus to a greater software emphasis.  With rapid growth in revenues for the Information Engineering Facility(TM), (IEF)(TM), TI is gaining recognition as the leading supplier in the integrated computer-aided software engineering market.
    IEF is the flagship software product for TI's overall thrust to build a billion-dollar software business in the mid-1990s.
    New areas of software focus were also discussed.  TI's enterprise systems software business directly leverages IEF and TI's extensive internal systems experience in offering information applications, systems integration and consulting services for solutions such as procurement, order processing, electronic data interchange, financial portfolio management, and manufacturing and engineering automation.
    TI noted that improved cost effectiveness of smaller networked processors will be instrumental in the growth of distributed computing. To serve this growing market, TI is developing tools for deploying and managing distributed computing applications and information.
    NEW VENTURE PROJECTS
    TI's new corporate ventures activity fosters an entrepreneurial environment to nurture new business initiatives that will help convert TI's R&D into  useful products and services.  New initiatives, including automotive electronic sensors, radio-frequency identification systems, solar energy technology, telecommunications, digital imaging, and speech processing, are in various stages of productization.  TI noted that several of these areas could represent billion-dollar market opportunities in the 1990s.
    -0-          2/27/92
    /NOTE TO EDITORS:  Texas Instruments Incorporated, headquartered in Dallas, is a high-technology company with sales and manufacturing operations in more than 30 countries.  TI develops, manufactures and markets semiconductors, defense electronics systems, software productivity tools, computer systems and peripheral products, custom engineering and manufacturing services, electrical controls, metallurgical materials, and consumer electronic products.
    Information Engineering Facility and IEF are trademarks of Texas Instruments Incorporated./
    /CONTACT:  Terri West, 214-995-3481, or Leslie Price, 214-995-2355, both of Texas Instruments/
    (TXN) CO:  Texas Instruments ST:  Texas IN: SU: SH -- NY010 -- 3112 02/27/92 09:13 EST
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Date:Feb 27, 1992
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