Investor Presentaiton
FORM 10-K
We have not made a provision for U.S. income tax on the portion of our undistributed earnings of our non-U.S. subsidiaries that is
considered permanently reinvested outside the United States. If in the future we repatriate any of these foreign earnings, we might
incur incremental U.S. income tax, which could affect our results of operations.
Our results of operations and financial condition could be adversely affected if a customer or a
distributor suffers a loss with respect to our inventory.
We have consignment inventory programs in place for some of our largest customers and distributors. If a customer or distributor
were to experience a loss with respect to Tl-consigned inventory, our results of operations and financial condition may be
adversely affected if we do not recover the full value of the lost inventory from the customer, distributor or insurer, or if our
recovery is delayed.
Our results of operations could be adversely affected by our distributors' promotion of competing
product lines or our distributors' financial performance.
In 2016, about 60 percent of our revenue was generated from sales of our products through distributors. Our distributors carry
competing product lines, and our sales could be affected if our distributors promote competing products over our products.
Moreover, our results of operations could be affected if our distributors suffer financial difficulties that result in their inability to pay
amounts owed to us. Disputes with or the loss of a significant number of distributors could be disruptive or harmful to our current
business.
Our margins may vary over time.
Our profit margins may be adversely affected by a number of factors, including decreases in customer demand and shipment
volume; obsolescence of our inventory; shifts in our product mix; and changes in tariffs. In addition, we operate in a highly
competitive market environment that might adversely affect pricing for our products. Because we own much of our manufacturing
capacity, a significant portion of our operating costs is fixed. In general, these fixed costs do not decline with reductions in
customer demand or factory loadings, and can adversely affect profit margins as a result.
Our performance depends in part on our ability to enforce our intellectual property rights and to maintain
freedom of operation.
Access to worldwide markets depends in part on the continued strength of our intellectual property portfolio. There can be no
assurance that, as our business expands into new areas, we will be able to independently develop the technology, software or
know-how necessary to conduct our business or that we can do so without infringing the intellectual property rights of others. To
the extent that we have to rely on licensed technology from others, there can be no assurance that we will be able to obtain
licenses at all or on terms we consider reasonable. We may, directly or indirectly, face infringement claims from third parties,
including non-practicing entities that have acquired patents to pursue enforcement actions against other companies. These
assertions, whether or not of any merit, could expose us to claims for damages and/or injunctions from third parties, as well as
claims for indemnification by our customers in instances where we have a contractual or other legal obligation to indemnify them
against damages resulting from infringement claims.
We actively enforce and protect our own intellectual property rights. However, our efforts cannot prevent all misappropriation or
improper use of our protected technology, including, for example, third parties' use of our patented technology in their products
without the right to do so or third parties' sale of counterfeit products bearing our trademark. Moreover, the laws of countries
where we operate may not protect our intellectual property rights to the same extent as U.S. laws.
Our debt could affect our operations and financial condition.
From time to time, we issue debt securities with various interest rates and maturities. While we believe we will have the ability to
service this debt, our ability to make principal and interest payments when due depends upon our future performance, which will
be subject to general economic conditions, industry cycles, and business and other factors affecting our operations, including the
other risk factors described under Item 1A, many of which are beyond our control. In addition, our obligation to make principal and
interest payments could divert funds that otherwise would be invested in our operations or returned to shareholders, or could
cause us to raise funds by, for example, issuing new debt or equity or selling assets.
TEXAS INSTRUMENTS . 2016 FORM 10-K
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