LSI Corp.'s shares also rose, after a Deutsche Bank analyst upgraded the fabless chip developer, predicting growth for all of its businesses in the third quarter.

Arnab Chanda upgraded LSI to "Buy" from "Hold" with a target price of $9.

"We believe that since the Agere acquisition, LSI has become much more focused on its core business," the analyst wrote. "We are gratified that management has taken swift action in order to focus the company."

LSI bought Agere Systems in April for $4 billion and has instituted several cost-cutting measures since.

The company's shares rose 29 cents, or 4.3 percent, to $7.01. The stock is still down nearly 18 percent since the end of April.

Citi Investment Research analyst Glen Yeung expects Texas Instruments to leave the midpoint of its revenue guidance unchanged. Texas Instruments currently forecasts sales of $3.49 billion to $3.79 billion. Analysts polled by Thomson Financial are expecting sales of $3.66 billion.

"With inventories in their best shape in 18 months, analog demand is better approximating solid end-demand trends, consistent with TI's existing guidance," the analyst wrote in a note to clients.

Yeung said industry leader Intel Corp. remains his "top idea," but called Texas Instruments, one of the world's oldest chip makers, a "good second choice in the current risky environment."

Shares of Texas Instruments rose 40 cents to $35.62 in midday trading. Intel's shares climbed 12 cents to $25.47; the company raised its third-quarter outlook Monday morning.

Shares of Advanced Micro Devices Inc. inched up 4 cents to $12.98.

The Philadelphia Semiconductor Index rose 2.74 points to 498.60.