Texas Instruments earned a profit of $2.3bn on revenues of $13.39bn for 2005, the company reported yesterday, up from $1.8bn and $12.58bn for 2004.

Sequential revenue remained flat, but higher profit margins and lower R&D costs helped the DSP giant to a $655m profit on revenues of $3.59bn for the final quarter, boosting the operating profit as a per centage of revenue from 15.4pc to 22.6pc.

The company said 3G takeup helped the bottom line, with TI doubling the number of OMAP smartphone processors it shipped in the year.

TI celebrated by authorizing a $5bn stock buy-back.

However jubilation might be shortlived as the company projected sales of between $3.11bn to $3.38 bn for Q1 2006, lower than analysts had predicted. Executives blamed the late arrival of test equipment on its production lines for the lower than expected volumes this quarter. ®