Texas Instruments Inc. (TXN), the world's largest maker of chips for cell phones, Tuesday said it expects fourth-quarter revenue and earnings per share at the mid-range of its previous estimates, as order trends remain soft.

TI shares fell about 1.6 percent in after-hours trade.

Dallas-based TI said it now expects revenue of $3.02 billion to $3.14 billion, with earnings per share of 25 cents to 27 cents. It forecast revenue for the key semiconductor unit of $2.68 billion to $2.78 billion.

"I would describe order trends as still generally pretty soft," TI's vice president and investor relations manager Ron Slaymaker said on a conference call with analysts.

Slaymaker said inventory problems for standard products sold through middlemen was offset by strength in revenue for wireless chipsets. But he declined to forecast how much longer the period of inventory correction would last.

TI's own internal inventory will be down by the end of the quarter, Slaymaker said, as the company starts production on fewer wafers for new chips than it ships out during the period.

Inventory problems have plagued chip companies this year, both in their own warehouses and in the distribution channel. The inventory issue dampened what started as an optimistic year for the industry.

TI in mid-October forecast earnings per share of 24 cents to 28 cents on revenue of $2.96 billion to $3.2 billion. At the time it projected semiconductor revenue of $2.63 billion to $2.83 billion.

Analysts polled by Reuters Estimates expected earnings per share of 24 cents to 28 cents, with an average estimate of 26 cents. They were expecting revenue of $3.08 billion to $3.17 billion, with an average forecast of $3.11 billion.

Shares in TI fell to $24.61 in after-hours trade on Inet from a close of $25 on the New York Stock Exchange (search).