Chip maker Texas Instruments Inc posted better-than-expected quarterly results on Monday, citing strong demand across all business segments including computers, phones and cars.

TI's shares rose 2 percent after it said results in the fourth quarter should also beat current forecasts, adding that its customers have stopped the inventory corrections that depressed demand earlier in the year.

Chief Financial Officer Kevin March noted that it was not unusual to see production levels increase in the third quarter in anticipation of the holiday shopping season. Still, he warned that he expected demand to be softer than normal for the season.

Santa Claus tends to come back every year. The question is, how big is his bag? March said in an interview with Reuters. It's difficult to think it's going to be real exciting. One would have to expect it's going to be fairly subdued if for no other reason than that unemployment remains high.

But at least one analyst said the results and guidance, which followed a better-than-expected report from chip giant Intel Corp , suggested TI's customers were seeing strengthening demand.

It's clear that the recovery for the semiconductor guys is both real and not inventory-driven. That gives a lot of people hope that we're not seeing a false start. This is actually real demand, said Charter Equity Research analyst Ed Snyder.

The company said third-quarter profit fell to $538 million, or 42 cents per share, from $563 million, or 43 cents a share, a year earlier.

That beat Wall Street analysts' average forecast for profit of 40 cents a share, according to Thomson Reuters I/B/E/S.

The company, which is recovering from an industry-wide decline in chip demand due to the global recession, said revenue fell to $2.88 billion from $3.39 billion. That beat analysts' average expectation of $2.82 billion, according to Thomson Reuters I/B/E/S.

TI forecast fourth-quarter earnings per share in a range of 42 to 50 cents on revenue of $2.78 billion to $3.02 billion compared with Wall Street expectations for revenue of $2.788 billion, according to Thomson Reuters I/B/E/S.

The company's shares rose 2.5 percent to $24.10 in after-hours trade after closing at $23.52 on the New York Stock Exchange.

(Reporting by Sinead Carew; Editing by Gary Hill and Matthew Lewis)

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