TI sees strong demand for mobile phones in Q2

Texas Instruments, the world's largest maker of chips for mobile phones, raised its sales outlook for the second quarter on Thursday, a sign that demand for wireless handsets and other devices remains brisk.

The company's increased forecast should help rebuild some confidence in the tech industry after some economists and analysts had begun to ask whether demand from users would fall as a result of high oil prices, rising interest rates and other factors.

Chips from the Dallas, Texas, company power a huge portion of the world's mobile phones, base stations and other gadgets, making its financial views an important indicator of global trends in cellular telephony, including 3G (third generation).

"We're not seeing signs of demand slackening at all at this point," said Ron Slaymaker, a vice president at TI, during a conference call.

"Our view on wireless continues to be strong. We expect growth on both ends, both in 3G and in low-cost handset markets."

The company expects its second-quarter sales to come in between $3.63 billion and $3.78 billion, compared to its prior guidance of $3.46 billion to $3.75 billion.

Its forecast for earnings per share from continuing operations is $0.46 to $0.48, higher than its previous range of $0.38 to $0.43. The company's second quarter ends June 30.

Texas Instruments commands a 77 percent share of the wireless application processor market, according to market researcher IDC.