On Tuesday, Texas Instruments Inc. hiked its earnings and sales outlook on the back of an improving market for chips that are used in mobile handsets and other electronic devices, like hard drives and gaming consoles.

As of the latest forecast shared, the Dallas based company now expects to earn between 47 cents to 51 cents a share, which is a substantial hike from the previously shared expectation of per share earnings of between 42 cents and 50 cents. The development has come after third-quarter earnings of 42 cents a share.

Revenue forecast was also lifted by the company from an earlier range of $2.78 Billion to $3.02 Billion, to a new high of between $2.90 Billion to $3.02 Billion, and this would mark a sequential growth of about 1%-5% overall.

As for the analysts polled by Thomson Reuters, they have pegged Texas Instruments' earnings at 47 cents a share on revenue of $2.93 Billion.

According to executives of the company, the firm has recorded a sharp rise in demand for its offerings over the past few quarters, which has led them to believe that it will end up doing much better than previously expected. October and November have both been termed as "strong" by Texas Instruments.