Updated from 5:13 p.m. EDT With a slowdown in demand pinching one of its key product lines, Texas Instruments ( TXN ) is planning for more tough times ahead. The Dallas chipmaker said Monday that it is dialing down manufacturing activity at its semiconductor factories and will hold the line on operating expenses in the coming quarters. TI described the moves as prudent steps to see the company through a period in which revenue is now forecast to fall below the company's -- and Wall Street 's -- expectations. "We're becoming more concerned about the economic environment and near-term demand," CFO Kevin March said in a post-earnings conference call Monday. TI said sales in the current quarter will range between $3.24 billion to $3.5 billion. The $3.37 midpoint of the range was short of the $3.44 billion expected by analysts. The company forecast second-quarter EPS between 42 cents and 48 cents. The Street was looking for 48 cents. So far, the problem is limited to high-end smartphones.