Texas Instruments (NASDAQ:TXN) Posts Quarterly Earnings Results, Beats Expectations By $0.22 EPS

Texas Instruments (NASDAQ:TXN) announced its quarterly earnings data on Wednesday. The semiconductor company reported $2.62 EPS for the quarter, topping analysts’ consensus estimates of $2.40 by $0.22, Zacks reports. Texas Instruments had a return on equity of 35.77% and a net margin of 31.11%. The company had revenue of $6.05 billion during the quarter, compared to the consensus estimate of $5.94 billion. During the same quarter last year, the company earned $1.48 EPS. The company’s quarterly revenue was up 27.7% on a year-over-year basis.

Here are the key takeaways from Texas Instruments’ conference call:

• Positive Sentiment: Third-quarter revenue rose 11% sequentially and 28% year over year to $6.1 billion, with broad-based growth across regions and end markets. Industrial revenue increased more than 40%, data center grew about 95%, and automotive rose in the mid-teens year over year.
• Positive Sentiment: Profitability and cash generation strengthened significantly: gross margin reached 64%, operating profit rose 73% year over year to $2.9 billion, and trailing-12-month free cash flow increased to $8.4 billion. TI also raised its dividend 7% to $1.52 per share, its 23rd consecutive annual increase.
• Positive Sentiment: Management issued fourth-quarter revenue guidance of $5.8 billion to $6.3 billion and EPS guidance of $2.45 to $2.79, implying stronger-than-usual seasonal performance. Data center demand remains robust, while industrial recovery, energy infrastructure, aerospace and defense, robotics, and automotive—particularly EV-related demand—are providing additional momentum.
• Neutral Sentiment: Demand is tightening supply conditions, with lead times ticking higher and some back-end equipment availability constraints. TI plans to continue investing in manufacturing capacity, with 2026 capital expenditures expected near the high end of its $2 billion-$3 billion range, while pricing discussions for 2027 are ongoing.

Texas Instruments Stock Performance

Shares of Texas Instruments stock opened at $284.65 on Thursday. The firm has a market cap of $259.96 billion, a price-to-earnings ratio of 43.33, a price-to-earnings-growth ratio of 1.55 and a beta of 1.35. The stock’s 50-day moving average is $271.76 and its 200-day moving average is $278.84. The company has a debt-to-equity ratio of 0.72, a current ratio of 4.86 and a quick ratio of 3.44. Texas Instruments has a one year low of $152.73 and a one year high of $334.03.

Texas Instruments Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, November 10th. Stockholders of record on Friday, October 30th will be issued a $1.52 dividend. This represents a $6.08 dividend on an annualized basis and a dividend yield of 2.1%. This is a positive change from Texas Instruments’s previous quarterly dividend of $1.42. The ex-dividend date is Friday, October 30th. Texas Instruments’s dividend payout ratio is presently 86.45%.

Texas Instruments News Roundup

Here are the key news stories impacting Texas Instruments this week:

• Positive Sentiment: Q3 results exceeded expectations. Texas Instruments reported revenue of approximately $6.06 billion, net income of $2.43 billion and EPS of $2.62, versus the consensus estimate of $2.40. Revenue increased 27.7% year over year, with growth led by industrial, automotive and data-center demand. TI reports third quarter 2026 financial results
• Positive Sentiment: Management’s outlook also topped expectations. Reports highlighted record industrial revenue and 95% data-center growth, while fourth-quarter guidance was above Wall Street forecasts. The results reinforce the view that analog and embedded-chip demand is entering a broader cyclical recovery. Texas Instruments Q3 2026 earnings call transcript
• Positive Sentiment: Improving utilization and lower capital spending could strengthen cash flow. An investment analysis cited accelerating revenue and margin growth, including a 61.4% gross margin and 42.3% operating margin in the second quarter, while fiscal 2026 capital-expenditure guidance of $2 billion to $3 billion is moderating. This combination could support earnings and free-cash-flow growth. Texas Instruments: Broader Recovery And Lower Capex Support Further Upside
• Neutral Sentiment: Analyst opinion is mixed. Wells Fargo maintained an Equal Weight rating and reduced its target from $310 to $300, while TD Cowen cut its target from $340 to $330 but retained a Buy rating. The revisions suggest analysts see upside, but believe much of the recovery may already be reflected in the valuation. Texas Instruments stock gets price target cut from TD Cowen
• Negative Sentiment: Valuation and insider selling temper the bullish case. TXN trades at roughly 41 times trailing earnings, and reports noted broad insider selling in recent months. Investors may therefore demand continued strong growth and execution to justify the premium multiple. Texas Instruments sees profits recover, but is the stock still expensive?

Analyst Ratings Changes

Several analysts have recently weighed in on the stock. Citigroup reiterated a “buy” rating and set a $345.00 target price (up from $280.00) on shares of Texas Instruments in a research report on Tuesday, July 14th. Morgan Stanley reissued an “underweight” rating on shares of Texas Instruments in a report on Thursday. Sanford C. Bernstein boosted their target price on Texas Instruments from $250.00 to $290.00 and gave the stock a “market perform” rating in a research report on Thursday, July 23rd. Jefferies Financial Group restated a “hold” rating and issued a $300.00 price objective on shares of Texas Instruments in a report on Thursday. Finally, Wall Street Zen upgraded Texas Instruments from a “hold” rating to a “buy” rating in a report on Saturday, July 18th. Fifteen investment analysts have rated the stock with a Buy rating, eleven have given a Hold rating and four have assigned a Sell rating to the stock. According to data from MarketBeat, the company currently has a consensus rating of “Hold” and an average price target of $307.37.

Insider Activity at Texas Instruments

In related news, VP Tsedeniya Abraham sold 7,000 shares of the stock in a transaction on Thursday, August 27th. The shares were sold at an average price of $264.63, for a total transaction of $1,852,410.00. Following the completion of the transaction, the vice president owned 23,181 shares in the company, valued at approximately $6,134,388.03. This represents a 23.19% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. 0.60% of the stock is currently owned by corporate insiders.

About Texas Instruments

Texas Instruments Incorporated (NASDAQ:TXN) designs and manufactures analog and embedded semiconductor products used in industrial, automotive, personal electronics, communications equipment, and enterprise systems. Its analog products help manage power, sense and measure real-world signals, and support signal processing, while its embedded processing products provide computing and control functions within electronic systems.

The company offers a broad portfolio of semiconductors, including power-management devices, amplifiers, data converters, microcontrollers, processors, and connectivity products.