Texas Instruments Inc. projected third-quarter revenue that topped analysts’ estimates, indicating the company is seeing increased orders from customers trying to cushion themselves against any supply disruptions as the coronavirus pandemic drags on.

Earnings will be US$1.14 to US$1.34 a share, on revenue of US$3.26 billion to US$3.54 billion, in the period ending in September, the Dallas-based chipmaker said Tuesday in a statement. On average, analysts predicted profit of 98 cents US and sales of US$3.07 billion, according to data compiled by Bloomberg.

Texas Instruments, which has the broadest customer list and biggest product catalog in the industry, is benefiting from greater-than-anticipated inventory purchasing by its clients, executives said on a conference call. The company is the first major U.S. manufacturer to report earnings. Its reach gives investors a forward look into demand for everything from space hardware to home electronics.

“The business has certainly troughed and is starting to show signs of life again,” said Logan Purk, an analyst at Edward Jones. Still, the pandemic and continuing trade strife between the U.S. and China may hurt demand in the near future, he said.

Covid-19 illnesses have shut factories and transportation worldwide, placing an unprecedented strain on a global supply chain that provides electronics makers with components only at the moment they need it. Chip consumers -- everyone from automakers to Apple Inc. -- now want stockpiles to guard against future disruptions and make sure they can keep manufacturing rolling.

The chipmaker has said it would keep production running and build its own inventory to make sure it can satisfy the demand.

Texas Instruments “did not experience the depths of the downturn we saw in the 2008 downturn,” Dave Pahl, head of investor relations, said on the conference call. Still, “we
remain cautious on how the economy might behave for the next few years,” he said.

In the second quarter, net income rose to US$1.38 billion, or US$1.48 per share, from US$1.31 billion, or US$1.36 per share, a year earlier, the company said. Revenue dropped 12 per cent to US$3.24 billion.

Shares increased about one per cent in extended trading after closing at US$135.48 in New York. The stock is has gained 5.6 per cent this year, lagging behind the Philadelphia Stock Exchange Semiconductor Index’s advance of 13 per cent.