Texas Instruments, famous for its scientific calculators globally, is shutting down semiconductor manufacturing plant

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in Houston and Japan to cut costs, thus eliminating over 500 jobs.

Chipmaker Texas Instruments (TI) posted a 68 per cent drop in quarterly profits as the semiconductor industry continues to suffer in the economic downturn.

The company released its fourth quarter 2011 financials yesterday with revenue of $3.42 billion, down three per cent from a year ago.

While revenue was fairly steady, the firm's profits fell off a cliff with the company making $292 million, a 68 per cent decline from the same period in 2010.

The Houston plant office which is in the city of Stafford near here, will be a huge blow to the community.

The 45-year-old Stafford plant has 1,000 employees, 500 of whom will be relocated to another facility.

The company also said it would close a similar plant in Japan. The company, said the cutbacks will save Texas Instruments about $100 million annually.

The Dallas-based company is the third largest manufacturer of semiconductors worldwide after Intel and Samsung, the second largest supplier of chips for cellular handsets.