Texas Instruments Inc.

TXN
Financial Analysis · Updated May 12, 2026 · Coverage 2026-Q2
Latest Q Revenue
$4.1B
Q1 FY2026 · +19% YoY
TTM ROIC
21%
FY2025 · NOPAT / Invested Capital (implied) · WACC ~9% · Moat spread +12pp
Margin Profile
Gross 57%
Operating 34.1%
FCF 14.7%
FY2025
Net Debt
$6.0B
Cash $8.0B · Debt $14.0B · FY2025

Business Overview

ticker: TXN step: 01 generated: 2026-05-12 source: quick-research

Texas Instruments Incorporated (TXN) — Business Overview

Business Description

Texas Instruments is the world's largest analog semiconductor company by revenue and the third-largest US-based semiconductor company. TI designs and manufactures analog ICs (signal conditioning, power management) and embedded processing chips used across industrial, automotive, personal electronics, communications, and enterprise equipment. Pending acquisition of Silicon Labs ($7.5B) was announced. CEO Haviv Ilan (since 2023, succeeded Rich Templeton).

Revenue Model

  • Analog (~75% of revenue): Power management (DC/DC, LDOs), signal chain (amplifiers, data converters), high-volume catalog parts
  • Embedded Processing (~15%): MCUs, processors (Sitara, Jacinto), DSPs (C2000 real-time control)
  • Other (~10%): DLP (digital light processing), calculators, legacy products
  • Roughly ~80,000 products serving 100,000+ customers — exceptional diversification

Products & Services

Analog
  • Power Management: Battery management, DC/DC converters, LDOs, GaN
  • Signal Chain: Amplifiers, data converters (ADCs/DACs), interface (CAN, RS485, USB), clocks
  • High-volume catalog: Available in distribution; rapid design-in
Embedded Processing
  • Microcontrollers: MSP430, MSP432, C2000 real-time control
  • Sitara: Linux-based processors (industrial, IoT)
  • Jacinto: Automotive infotainment + ADAS
  • TI Connectivity: Wi-Fi, Bluetooth, Sub-1GHz
Manufacturing Footprint
  • 300mm fabs: RFAB1 (Richardson, TX); RFAB2 (Richardson, ramping); LFAB1 (Lehi, UT); SM1 (Sherman, TX — started production Dec 2025); future SM2, SM3, SM4
  • 150mm legacy: Most being transitioned to 300mm
  • >$60B planned investment across 7 US fabs (largest in foundational semis history)
  • CHIPS Act funding: Up to $1.61B + $7.5-9.5B lifetime benefits

Customer Base & Go-to-Market

  • Industrial (~34% of revenue): Factory automation, building automation, medical, test/measurement
  • Automotive (~35% of revenue): ADAS, infotainment, body electronics, powertrain (especially EVs)
  • Personal Electronics (~15%): Smartphones, PCs, wearables
  • Communications + Enterprise (~10%): Datacenter (growing 90% YoY!), network equipment
  • Other (~6%): Aerospace, defense, scientific
  • Channel: Direct sales + distribution (Arrow, Avnet)
  • Geographic mix: ~50% Americas, ~25% Asia, ~15% Europe, ~10% Japan; China ~20% of revenue

Competitive Position

TXN is the global #1 in analog ICs (~19% market share), with embedded processing #4-5. Moats: (1) 300mm wafer technology — ~40% cost advantage vs 200mm peers, (2) the broadest analog catalog (80,000+ products) creates customer stickiness, (3) direct sales relationships with 100,000+ customers, (4) US-based manufacturing alignment with onshore + CHIPS Act incentives. Competitors: Analog Devices, Infineon, STMicro, NXP, Microchip, ON Semiconductor. Chinese local analog vendors gaining share via gov subsidies + low-cost competition — increasingly meaningful threat.

Key Facts

  • Founded: 1930 (Geophysical Service Inc.); renamed Texas Instruments 1951
  • Headquarters: Dallas, TX
  • Employees: ~33,000
  • Exchange: NASDAQ
  • Sector / Industry: Technology / Semiconductors
  • Market Cap: ~$170B (May 2026)
  • CEO: Haviv Ilan (since April 2023)
  • Dividend: $5.44 annual ($1.36 quarterly)
  • 21+ consecutive years of dividend growth
  • Pending acquisition: Silicon Labs ($7.5B announced 2025)

Financial Snapshot

ticker: TXN step: 04 generated: 2026-05-12 source: quick-research

Texas Instruments Incorporated (TXN) — Financial Snapshot

Income Statement Summary

Metric FY2023 FY2024 FY2025 YoY
Revenue $17.5B $15.6B $17.7B +13%
Gross Margin 62% 58% 58.5% +50bps
Operating Margin 41% 37% 38% +1pp
Net Income $6.5B $4.8B $5.0B +5%
EPS (diluted) $7.07 $5.24 $5.50 +5%
Free Cash Flow $1.5B $1.5B $2.6B +73%

Segment Revenue (FY2025)

Segment % of Revenue
Industrial ~34%
Automotive ~35%
Personal Electronics ~15%
Communications + Enterprise ~10% (Data Center +90% YoY)
Other (incl. Govt) ~6%

Q1 2026 Highlights

Metric Q1 2026 YoY
Revenue $4.07B +19%
EPS $1.46 +24%
All segments + geographies + customer sizes Sequential growth (broadest recovery in 2 years)
Data Center Revenue +90% YoY
Industrial Recovery First broad-based positive signal in 2 years

Capacity Expansion Plan

Metric Value
Total US investment plan >$60B (largest in foundational semis history)
Through 2029 commitment $18B+
Number of US fabs 7
CHIPS Act funding Up to $1.6B (announced); $7.5-9.5B lifetime
Sherman (SM1) Production started Dec 2025
RFAB2 (Richardson) Ramping; will more than double RFAB1 capacity
LFAB1 (Lehi) Continuing ramp on 45nm-65nm

Capex Profile

Year Capex
FY2023 $5.2B
FY2024 $4.7B
FY2025 ~$5.0B
FY2026 (guide) $2-3B (cycle 83% complete)
Going forward Normalized $1.5-2.5B annual

Cash Flow & Balance Sheet (FY2025)

Metric Value
Operating Cash Flow ~$7.5B
Capital Expenditures ~$5.0B
Free Cash Flow $2.6B (15% margin)
Cash & Investments ~$8B
Total Debt ~$14B
Net Debt / EBITDA ~1.0x

Key Ratios (approximate, May 2026)

  • P/E (forward): ~27x | EV/EBITDA: ~17x | Dividend Yield: ~2.9%
  • ROIC: ~30%+
  • FCF margin: 15% (FY25) → projected 33% (FY26) as capex moderates

Growth Profile

Q1 2026 marks a watershed: all sectors + geographies + customer sizes grew sequentially for first time in 2 years — broadest recovery signal. Data Center revenue +90% YoY. The 5-year capex cycle is 83% complete. FY26 capex moderates to $2-3B (from $5B), enabling FCF margin to expand from 14.7% (FY25) to ~33% (FY26 target). Management targeting $8+ FCF per share in 2026.

Forward Estimates

  • FY2026E Revenue: ~$20-21B (+13-19%)
  • FY2026E EPS: ~$6.50 (consensus, +18%)
  • FY2026E FCF Per Share: $8+ (mgmt target)
  • FY2027E EPS: ~$7.50 (+15%)
  • FY2030 Bull Target (TIKR): $391.75/share; EPS $12.57

Capital Return

  • Quarterly dividend $1.36 = $5.44 annual (~$5B paid)
  • 21 consecutive years of dividend growth
  • Buybacks moderated during capex cycle; expected to resume meaningfully as FCF expands
  • TI has historically returned 100% of FCF to shareholders

Deeper Financial Analysis

The fundamental tier adds 9 additional research dimensions for $TXN.

Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
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