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(Adds comment from analyst, one-time gain and charges)
By Noel Randewich
SAN FRANCISCO, July 22 (Reuters) - Texas Instruments Inc gave a third-quarter revenue forecast that was stronger than some analysts expected and said customers seem more confident about placing orders for chips.
Orders picked up in the first half of 2013 and Chief Financial Officer Kevin March told Reuters on Monday that business continues to improve, following weak demand last year due to concerns about the global economy.
Texas Instruments' book to bill ratio, a measure of orders filled, was 1.03 in the second quarter, unchanged from the prior quarter. A ratio of over 1 suggests a chipmaker received more orders than it could fill during a given period.
TI's customers are starting to give the No. 3 U.S. chipmaker a better idea about their future needs.
"Up until this past quarter with these orders it's been for pretty short-term deliveries, so that's a bit of a change in tone and perhaps confidence on the part of our customers," March said.
Texas Instruments is winding down its wireless chip business as competition from Qualcomm Inc and other rivals has hurt profitability. TI is focusing on analog and embedded chips used in products ranging from cars to televisions and which account for the bulk of the company's revenue.
Analog and embedded account for 78 percent of TI's revenue, up 6 percentage points from a year ago, the company said.
"The quality of their earnings is moving much more significantly toward their core business and away from lower-gross margin wireless," said FBR Capital Markets analyst Chris Rolland.
Texas Instruments said its second-quarter results included a gain from the sale of some wireless connectivity technology as well as higher-than-expected charges from the company's restructuring.
TI posted second-quarter revenue of $3.047 billion, down 9 percent from the year-ago period.
Net income jumped to $660 million, or 58 cents a share, from $446 million, or 38 cents a share, in the 2012 second quarter.
In the third quarter, revenue will range from $3.09 billion to $3.35 billion, the company estimated.
Analysts on average had expected revenue of $3.059 billion for the second quarter and $3.199 billion for the third quarter, which ends in September, according to Thomson Reuters I/B/E/S.
Texas Instruments estimated earnings per share of 49 to 57 cents in the third quarter.
Shares of Texas Instruments rose 1.95 percent in extended trade after closing up 0.43 percent at $37.42 on Nasdaq. (Reporting by Noel Randewich; Editing by Richard Chang)