Q4 2025 Texas Instruments Inc Earnings Call

January 27, 2026

And I'm joined by our chairman president and chief executive officer haviv Ilan and our Chief Financial Officer at Rafael lazzari.

For any of you who missed the release, you can find it on our website at ti.com.

This call is being broadcast live over the web and can be accessed through our website. In addition to today's call is being recorded and will be available via replay on our website.

This call will include forward-looking statements that involve risks and uncertainties that could cause TI's results to differ materially from Management's, current expectations.

We encourage you to review. The notice regarding forward-looking statements contained in the earnings release published today. As well as TI's. Most recent SEC filings for a more complete description.

I would like to provide you some information that is important for your calendars on Tuesday, February 24th, at 10:00 a.m. Central Time, we will have our Capital Management call.

Similar to what we've done in the past Aviv Rafael. And I will share our approach to Capital allocation and summarize our progress as we prepare for the opportunity ahead.

Speaker #1: Welcome to the Texas Instruments fourth quarter 2025 earnings conference call. I'm Mike Beckman, Head of Investor Relations, and I'm joined by our Chairman, President, and Chief Executive Officer, Haviv Ilan, and our Chief Financial Officer, Rafael Lizardi.

Mike Beckman: Welcome to the Texas Instruments Q4 2025 Earnings Conference Call. I'm Mike Beckman, Head of Investor Relations, and I'm joined by our Chairman, President, and Chief Executive Officer, Haviv Ilan, and our Chief Financial Officer, Rafael Lizardi. For any of you who missed the release, you can find it on our website at ti.com/ir. This call is being broadcast live over the web and can be accessed through our website. In addition, today's call is being recorded and will be available via replay on our website. This call will include forward-looking statements that involve risks and uncertainties that could cause TI's results to differ materially from management's current expectations. We encourage you to review the notice regarding forward-looking statements contained in the earnings release published today, as well as TI's most recent SEC filings for a more complete description.

Q4 2025 Texas Instruments Inc Earnings Call

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Texas Instruments

Earnings

Q4 2025 Texas Instruments Inc Earnings Call

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Tuesday, January 27th, 2026 at 9:30 PM

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Moving on today, we'll provide the following updates.

First havie will start with a quick overview of the quarter.

Next, he will provide insight into fourth quarter Revenue results with some details of what we are seeing in our end markets.

Have evil. Then provide the annual summary of Revenue Breakout by End Market.

lastly, Rafael will cover the financial results and our guidance for first quarter 2026,

With that, let me turn it over to haviv.

Thanks Mike. Let me start with a quick overview of the fourth quarter.

Revenue came in about as expected at 4.4 billion, a decrease of 7% sequentially and an increase of 10% from the same quarter a year ago.

Analog Revenue, grew 14% year-over-year.

Mike Beckman: I would like to provide you some information that is important for your calendars. On Tuesday, 24 February, at 10:00AM Central Time, we will have our Capital Management call. Similar to what we've done in the past, Haviv, Rafael, and I will share our approach to capital allocation and summarize our progress as we prepare for the opportunity ahead. Moving on. Today, we'll provide the following updates: First, Haviv will start with a quick overview of the quarter. Next, he will provide insight into Q4 revenue results with some details of what we are seeing in our end markets. Haviv will then provide the annual summary of revenue breakout by end market. Lastly, Rafael will cover the financial results and our guidance for Q1 2026. With that, let me turn it over to Haviv.

I would like to provide you some information that is important for your calendars. On Tuesday, 24 February, at 10:00AM Central Time, we will have our Capital Management call. Similar to what we've done in the past, Haviv, Rafael, and I will share our approach to capital allocation and summarize our progress as we prepare for the opportunity ahead. Moving on. Today, we'll provide the following updates: First, Haviv will start with a quick overview of the quarter. Next, he will provide insight into Q4 revenue results with some details of what we are seeing in our end markets. Haviv will then provide the annual summary of revenue breakout by end market. Lastly, Rafael will cover the financial results and our guidance for Q1 2026. With that, let me turn it over to Haviv.

In grew 8% and our other segments declined from the year ago quarter.

The overall semiconductor Market recovery is continuing and we are well positioned with inventory and capacity to meet immediate customer demand.

Before I walk through our results, I like to share an update, we've made to our end markets.

To better reflect the growth opportunities. We see for our analog and embedded products, we reorganize our end markets to include data center which includes sectors related to Data, Center compute data center networking and rack power and thermal management.

as such our end markets, are now industrial Automotive data, center personal electronics, and Communications equipment,

Haviv Ilan: Thanks, Mike. Let me start with a quick overview of Q4. Revenue came in about as expected, at $4.4 billion, a decrease of 7% sequentially and an increase of 10% from the same quarter a year ago. Analog revenue grew 14% year-over-year. Embedded processing grew 8%, and our other segment declined from the year ago quarter. The overall semiconductor market recovery is continuing, and we are well-positioned with inventory and capacity to meet immediate customer demand. Before I walk through our results, I'd like to share an update we've made to our end markets. To better reflect the growth opportunities we see for our analog and embedded products, we reorganized our end markets to include data center, which includes sectors related to data center compute, data center networking, and rack power and thermal management.

With that as a backdrop, I'll now provide some insight into our fourth quarter Revenue by End Market.

First the industrial Market was up high team, zero near which recovery continuing broadly across sectors and was down mid single digits sequentially.

The automotive Market increased upper single digits year on year and was down low, single digits sequentially.

Data center, grey around 70% year on year.

And mid single digits sequentially.

Personal electronics declined, upper teens year on year and mid teens sequentially.

Lastly, Communications equipment declined. Low single digits here on year and mid teens sequentially.

In addition, as we do at the end of each calendar year, I'll describe our estimated 2025 Revenue by End Market.

Industrial was 5.8 billion dollars up, 12% year on year and was 33% of Revenue.

Haviv Ilan: As such, our end markets are now industrial, automotive, data center, personal electronics, and communications equipment. With that as a backdrop, I'll now provide some insight into our Q4 revenue by end market. First, the industrial market was up high teens year-on-year, with recovery continuing broadly across sectors, and was down mid-single digits sequentially. The automotive market increased upper single digits year-on-year and was down low single digits sequentially. Data center grew around 70% year-on-year and mid-single digits sequentially. Personal electronics declined upper teens year-on-year and mid-teens sequentially. Lastly, communications equipment declined low single digits year-on-year and mid-teens sequentially. In addition, as we do at the end of each calendar year, I'll describe our estimated 2025 revenue by end market. Industrial was $5.8 billion, up 12% year-on-year, and was 33% of revenue.

As such, our end markets are now industrial, automotive, data center, personal electronics, and communications equipment. With that as a backdrop, I'll now provide some insight into our Q4 revenue by end market. First, the industrial market was up high teens year-on-year, with recovery continuing broadly across sectors, and was down mid-single digits sequentially. The automotive market increased upper single digits year-on-year and was down low single digits sequentially. Data center grew around 70% year-on-year and mid-single digits sequentially. Personal electronics declined upper teens year-on-year and mid-teens sequentially. Lastly, communications equipment declined low single digits year-on-year and mid-teens sequentially. In addition, as we do at the end of each calendar year, I'll describe our estimated 2025 revenue by end market. Industrial was $5.8 billion, up 12% year-on-year, and was 33% of revenue.

Speaker #2: Our end markets are now industrial, automotive, data center, personal electronics, and communications equipment. With that as a backdrop, I'll now provide some insight into our fourth quarter revenue by end market.

Hold on. 1 E was 5.8 billion up 6% year on year and was 33% of Revenue.

Data center was 1.5 billion dollars up. 64% year on year and was 9% of Revenue.

Speaker #2: First, the industrial market was up.

Personal electronics was 3.7 billion dollars up 7% year on year and was 21% of Revenue.

Communications equipment was about 500 million up about 20% year on year and was 3% of Revenue.

First, the industrial market was up high-teens, zero near, with recovery continuing broadly across sectors, and was down mid-single digits sequentially.

The automotive market increased upper single digits year on year and was down low single digits sequentially.

In summary industrial automotive and data center combined made up about 75% of TI's Revenue in 2025 up from about 43% in 2013.

Data center grew around 70% year on year.

And mid single digits sequentially.

We see good opportunities in all of our markets, but we place additional strategic emphasis on Industrial automotive and data center.

Personal electronics declined upper teens year on year and mid-teens sequentially.

Lastly, communications equipment declined—low single digits year-on-year and mid-teens sequentially.

Our customers across. All regions are increasingly turning to analog and embedded technology to make their end. Products more reliable, more affordable, and lower in power,

In addition, as we do at the end of each calendar year, I'll describe our estimated 2025 revenue by end market.

Haviv Ilan: Automotive was $5.8 billion, up 6% year-over-year, and was 33% of revenue. Data center was $1.5 billion, up 64% year-over-year, and was 9% of revenue. Personal electronics was $3.7 billion, up 7% year-over-year, and was 21% of revenue. Communications equipment was about $500 million, up about 20% year-over-year, and was 3% of revenue. In summary, industrial, automotive, and data center combined made up about 75% of TI's revenue in 2025, up from about 43% in 2013. We see good opportunities in all of our markets, but we place additional strategic emphasis on industrial, automotive, and data center. Our customers across all regions are increasingly turning to analog and embedded technology to make their end products more reliable, more affordable, and lower in power.

Automotive was $5.8 billion, up 6% year-over-year, and was 33% of revenue. Data center was $1.5 billion, up 64% year-over-year, and was 9% of revenue. Personal electronics was $3.7 billion, up 7% year-over-year, and was 21% of revenue. Communications equipment was about $500 million, up about 20% year-over-year, and was 3% of revenue. In summary, industrial, automotive, and data center combined made up about 75% of TI's revenue in 2025, up from about 43% in 2013. We see good opportunities in all of our markets, but we place additional strategic emphasis on industrial, automotive, and data center. Our customers across all regions are increasingly turning to analog and embedded technology to make their end products more reliable, more affordable, and lower in power.

Which will likely continue to drive faster growth. In these end markets.

Industrial was $5.8 billion, up 12% year on year, and was 33% of revenue.

Rafael will now review profitability Capital Management and our Outlook.

Thanks Aviv and good afternoon everyone. As I've been mentioned, fourth quarter Revenue was 4.4 billion dollars.

$5.8 billion, up 6% year over year, and was 33% of revenue.

Gross profit in the quarter was 2.5 billion or 56% of Revenue. Sequentially gross profit. Margin decreased 150 basis points.

Data center was $1.5 billion, up 64% year on year, and was 9% of revenue.

Personal electronics was $3.7 billion.

Operating expenses in the quarter were 967, million of 3% from a year ago and about as expected.

Up 7% year on year and was 21% of revenue.

On a trailing 12-month basis, operating expenses were 3.9 billion dollars or 22% of Revenue.

Communications equipment was about $500 million, up about 20% year on year, and was 3% of revenue.

Operating profit was 1.5 billion in the quarter or 33% of Revenue and was up 7% from the year ago quarter.

Net income in the fourth quarter was 1.2 billion dollars or a dollar 27 per share.

In summary, industrial, automotive, and data center combined made up about 75% of TI's revenue in 2025, up from about 43% in 2013.

We see good opportunities in all of our markets, but we place additional strategic emphasis on industrial, automotive, and data center.

Earnings per share included a 6 Cent reduction, not in our original guidance related to the non-cash impairment of Goodwill in our other segments and other tax related items.

Let me now comment on our Capital Management results starting with our cash generation.

Haviv Ilan: This drives growing chip content per application or secular content growth, which will likely continue to drive faster growth in these end markets. Rafael will now review profitability, capital management, and our outlook.

This drives growing chip content per application or secular content growth, which will likely continue to drive faster growth in these end markets. Rafael will now review profitability, capital management, and our outlook.

Cash flow from operations was 2.3 billion in the quarter.

Our customers across all regions are increasingly turning to analog embedded technology to make their end products more reliable, more affordable, and lower in power.

Capital expenditures were 925 million in the quarter.

In the quarter, we paid 1.3 billion dollars in dividends and reverses 403 million of our stock.

Rafael Lizardi: Thanks, Haviv, and good afternoon, everyone. As Haviv mentioned, Q4 revenue was $4.4 billion. Gross profit in the quarter was $2.5 billion or 56% of revenue. Sequentially, gross profit margin decreased 150 basis points. Operating expenses in the quarter were $967 million, up 3% from a year ago and about as expected. On a trailing twelve-month basis, operating expenses were $3.9 billion or 22% of revenue. Operating profit was $1.5 billion in the quarter, or 33% of revenue, and was up 7% from the year ago quarter. Net income in the Q4 was $1.2 billion or $1.27 per share.

This drives growing chip content per application, or secular content growth, which will likely continue to drive faster growth in these end markets.

Rafael will now review profitability, capital management, and our outlook.

We also increase our dividend per share by 4% in the fourth quarter to 142 per share market. Our 22nd consecutive year of dividend increases.

Thanks, Aviv, and good afternoon, everyone. Fourth quarter revenue was $4.4 billion.

In total we have returned 6.5 billion in the past. 12 months to owners.

Our balance sheet remains strong with 4.9 billion of cash, and short-term Investments at the end of the fourth quarter.

Gross profit in the quarter was $2.5 billion, or 56% of revenue. Sequentially, gross profit margin decreased 150 basis points.

Total debt outstanding was 14 billion dollars. We have weighted average coupon of 4%

Operating expenses in the quarter were $967 million, up 3% from a year ago and about as expected.

On a trailing 12-month basis, operating expenses were $3.9 billion, or 22% of revenue.

inventory. At the end of the quarter was 4.8 billion down 25 million from the prior quarter and days were 222 up 7 Days sequentially.

Now, let's look at some of these results for the year.

Rafael Lizardi: Earnings per share included a $0.06 reduction, not in our original guidance, related to the non-cash impairment of goodwill in our Other segment and other tax-related items. Let me now comment on our capital management results, starting with our cash generation. Cash flow from operations was $2.3 billion in the quarter. Capital expenditures were $925 million in the quarter. In the quarter, we paid $1.3 billion in dividends and repurchased $403 million of our stock. We also increased our dividend per share by 4% in the Q4 to $1.42 per share, marking our 22nd consecutive year of dividend increases. In total, we have returned $6.5 billion in the past twelve months to owners.

Earnings per share included a $0.06 reduction, not in our original guidance, related to the non-cash impairment of goodwill in our Other segment and other tax-related items. Let me now comment on our capital management results, starting with our cash generation. Cash flow from operations was $2.3 billion in the quarter. Capital expenditures were $925 million in the quarter. In the quarter, we paid $1.3 billion in dividends and repurchased $403 million of our stock. We also increased our dividend per share by 4% in the Q4 to $1.42 per share, marking our 22nd consecutive year of dividend increases. In total, we have returned $6.5 billion in the past twelve months to owners.

Operating profit was $1.5 billion in the quarter, or 33% of revenue, and was up 7% from the year-ago quarter.

Net income in the fourth quarter was $1.2 billion, or $1.27 per share.

In 2025 cash flow. From operations was 7.2 billion dollars and capital expenditures were 4.6 billion dollars as we continue to make progress on our capacity. Expansions

Earnings per share included a $0.06 reduction, not in our original guidance, related to the non-cash impairment of goodwill in our Other segments and other tax-related items.

we're nearing the end of a 6 year elevated capex cycle, that uniquely positioned CI to deliver Dependable low cost 300, mm capacity at scale

Let me now comment on our capital management results, starting with our cash generation.

Cash flow from operations was $2.3 billion in the quarter.

Free cash flow for 2025 was 2.9 billion or 17% of Revenue representing an increase of 96% from 2024.

Capital expenditures were $925 million in the quarter.

Our free cash flow, growth reflects the strength of our business model as well as our decisions to invest in 300, mm, manufacturing assets and inventory.

In the quarter, we paid $1.3 billion in dividends and we purchased $403 million of our stock.

This supports our overall objective to maximize long-term free cash flow per share growth, which we believe is the primary driver of long-term value.

Rafael Lizardi: Our balance sheet remains strong, with $4.9 billion of cash and short-term investments at the end of the fourth quarter. Total debt outstanding was $14 billion, with a weighted average coupon of 4%. Inventory at the end of the quarter was $4.8 billion, down $25 million from the prior quarter, and days were 222, up 7 days sequentially. Now let's look at some of these results for the year. In 2025, cash flow from operations was $7.2 billion, and capital expenditures were $4.6 billion, as we continued to make progress on our capacity expansions. We're nearing the end of a 6-year elevated CapEx cycle that uniquely positions TI to deliver dependable, low-cost, 300-millimeter capacity at scale.

Our balance sheet remains strong, with $4.9 billion of cash and short-term investments at the end of the fourth quarter. Total debt outstanding was $14 billion, with a weighted average coupon of 4%. Inventory at the end of the quarter was $4.8 billion, down $25 million from the prior quarter, and days were 222, up 7 days sequentially. Now let's look at some of these results for the year. In 2025, cash flow from operations was $7.2 billion, and capital expenditures were $4.6 billion, as we continued to make progress on our capacity expansions. We're nearing the end of a 6-year elevated CapEx cycle that uniquely positions TI to deliver dependable, low-cost, 300-millimeter capacity at scale.

We also increased our dividend per share by 4% in the fourth quarter to $1.42 per share, marking our 22nd consecutive year of dividend increases.

In total, we have returned $6.5 billion in the past 12 months to owners.

In 2025 we received that 600770 million cash benefit related to chips act incentives.

Our balance sheet remains strong with $4.9 billion of cash and short-term investments at the end of the fourth quarter.

Total debt outstanding was $14 billion. We are at a weighted average coupon of 4%.

Turning to our outlook for the first quarter. We expect TR Revenue in the range of 4.32 to 4.68 billion dollars and earnings per share to be in the range of 1.22 to 1.48.

We continue to expect our effective tax rate for 2026 to be about 13 to 14%.

Inventory at the end of the quarter was $4.8 billion, down $25 million from the prior quarter, and days were 222, up 7 days sequentially.

Now, let's look at some of these results for the year.

In closing we will stay focused in the areas that add value in the long term. We continue to invest in our competitive advantages which are manufacturing and Technology. A broad product portfolio, reach of our channels and diverse and Long Live positions.

In 2025, cash flow from operations was $7.2 billion, and capital expenditures were $4.6 billion as we continue to make progress on our capacity expansions.

Rafael Lizardi: Free cash flow for 2025 was $2.9 billion or 17% of revenue, representing an increase of 96% from 2024. Our free cash flow growth reflects the strength of our business model, as well as our decisions to invest in 300-millimeter manufacturing assets and inventory. This supports our overall objective to maximize long-term free cash flow per share growth, which we believe is the primary driver of long-term value. In 2025, we received that $670 million cash benefit related to CHIPS Act incentives. Turning to our outlook for Q1, we expect TI revenue in the range of $4.32 to 4.68 billion and earnings per share to be in the range of $1.22 to $1.48.

Free cash flow for 2025 was $2.9 billion or 17% of revenue, representing an increase of 96% from 2024. Our free cash flow growth reflects the strength of our business model, as well as our decisions to invest in 300-millimeter manufacturing assets and inventory. This supports our overall objective to maximize long-term free cash flow per share growth, which we believe is the primary driver of long-term value. In 2025, we received that $670 million cash benefit related to CHIPS Act incentives. Turning to our outlook for Q1, we expect TI revenue in the range of $4.32 to 4.68 billion and earnings per share to be in the range of $1.22 to $1.48.

Able locals 300mm capacity at scale.

We will continue to strengthen this advantageous to discipline Capital allocation, and by focusing on the best opportunities, which we believe will enable us to continue to deliver free cash flow per share growth over the long term with that. Let me turn it back to Mike.

Free cash flow for 2025 was $2.9 billion, or 17% of revenue, representing an increase of 96% from 2024.

Our free cash flow growth reflects the strength of our business model as well as our decisions to invest in 300mm manufacturing assets and inventory.

Thanks. Raphael operator. You can now open the lines for questions in order to provide as many of you as possible and opportunity to ask your questions. Please limit yourself to a single question. After our response, we'll provide you with an opportunity for an additional follow-up operator.

This supports our overall objective to maximize long-term free cash flow per share growth, which we believe is the primary driver of long-term value.

In 2025, we received that $670 million cash benefit related to CHIPS Act incentives.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press start to to remove yourself from the queue for participants using speaker equipment. It may be necessary to pick up the handset before pressing the start keys.

Rafael Lizardi: We continue to expect our effective tax rate for 2026 to be about 13% to 14%. In closing, we will stay focused in the areas that add value in the long term. We continue to invest in our competitive advantages, which are manufacturing and technology, a broad product portfolio, reach of our channels, and diverse and long-lived positions. We will continue to strengthen disadvantages through disciplined capital allocation and by focusing on the best opportunities, which we believe will enable us to continue to deliver free cash flow per share growth over the long term. With that, let me turn it back to Mike.

We continue to expect our effective tax rate for 2026 to be about 13% to 14%. In closing, we will stay focused in the areas that add value in the long term. We continue to invest in our competitive advantages, which are manufacturing and technology, a broad product portfolio, reach of our channels, and diverse and long-lived positions. We will continue to strengthen disadvantages through disciplined capital allocation and by focusing on the best opportunities, which we believe will enable us to continue to deliver free cash flow per share growth over the long term. With that, let me turn it back to Mike.

1 moment, please while we pull for questions.

Turning to our outlook for the first quarter. We expect TR revenue in the range of $4.32 to $4.68 billion and earnings per share to be in the range of $1.22 to $1.48.

Our first question comes from the line of Ross Seymour with Deutsche Bank. Please proceed with your question.

We continue to expect our effective tax rate for 2026 to be about 13 to 14%.

In closing, we will stay focused in the areas that add value in the long term. We continue to invest in our competitive advantages, which are manufacturing and technology, a broad product portfolio, reach of our channels, and diverse and long-lived positions.

Done by either end Market or geography, that's giving you such an optimistic view versus relative, uh, or normal seasonality.

Haviv Ilan: Thanks, Rafael. Operator, you can now open the lines for questions. In order to provide as many of you as possible an opportunity to ask your questions, please limit yourself to a single question. After our response, we'll provide you with an opportunity for an additional follow-up. Operator?

Mike Beckman: Thanks, Rafael. Operator, you can now open the lines for questions. In order to provide as many of you as possible an opportunity to ask your questions, please limit yourself to a single question. After our response, we'll provide you with an opportunity for an additional follow-up. Operator?

We will continue to strengthen our discipline in capital allocation, and by focusing on the best opportunities, which we believe will enable us to continue to deliver free cash flow and pure growth over the long term. With that, let me turn it back to Mike.

Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up their handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from the line of Ross Seymore with Deutsche Bank. Please proceed with your question.

Thanks. Rafael, operator, you can now open the lines for questions in order to provide as many of you as possible an opportunity to ask your questions. Please limit yourself to a single question. After our response, we'll provide you with an opportunity for an additional follow-up. Operator.

Ross, thanks for. Thanks for the question. I'll take it and I'll let Mike get some more colors needed. Uh, first, let's start with the with the fourth quarter. We we have seen, um, a typical fourth quarter, uh, you know, Revenue came in as expected. Uh, but if you look at here on the, on the new results, uh, we are seeing uh, recovery continuing in in industrial.

Uh it grew close to 20%. Uh I think it was 18% over a year and remember that on the industrial Market we still have a lot of room to go when you think about the previous Peaks. So if you will the compare is still. Um it's still easy for industrial to continue to recover.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.

One moment, please, while we pull the questions.

Uh the other Market that I will highlight is you know the continued strength in data center. Uh we are seeing this market now becoming a little bit um

Ross Seymore: ... Hi, guys. Thanks for letting me ask a question. I guess my first question is, the Q1 guidance is significantly stronger than seasonal, and if my math is right, it seems like it's the first time you've guided up sequentially since right after the financial crisis, 15 years ago, roughly. So is there anything unique going on by either end market or geography that's given you such an optimistic view versus relative or normal seasonality?

More substantial as a percentage of our Revenue.

Our first question comes from the line of Ross Seymour with Deutsche Bank. Please proceed with your question.

Uh, I I expect this market to continue to, to grow in, q1. It's been growing for now. 7 quarters in a row for us, and, uh, we left the year at about 450, a million dollar recorded Revenue, um, footprint. And I think that continues, um, as we move forward,

Haviv Ilan: Ross, thanks for the question. I'll take it, and I'll let Mike add some more color as needed. First, let's start with the Q4. We have seen a typical Q4, you know, revenue came in as expected. But if you look at the year-over-year results, we are seeing recovery continuing in industrial. It grew close to 20%, I think it was 18% year-over-year. Remember that on the industrial market, we still have a lot of room to go when you think about the previous peaks. So if you will, the compare is still easy for industrial to continue to recover. The other market that I will highlight is, you know, the continued strength in data center.

Hi guys. Thanks for having me. Ask a question. I guess. My first question is, uh, the first quarter guidance is significantly stronger than seasonal. And and if my math is right, it seems like it's the first time. You've got it up sequentially since right after the financial crisis, uh, 15 years ago. Roughly so, is there anything unique going on by either end Market, or geography? That's given to you, uh, such an optimistic view versus relative, uh, or normal seasonality.

Ross, thanks for. Thanks for the question. I'll take it and I'll let Mike get some more colors needed. Uh, first, let's start with the with the fourth quarter. We we have seen, um, a typical fourth quarter, uh, you know, Revenue came in as expected. Uh, but if you look at the year on the on new results, uh, we are seeing uh, recovery continuing in in industrial.

Uh, the last point, I would say, we know, we did see orders uh, improving uh, throughout the quarter. And um what guides are are guidance is just stronger booking like I don't know if you want to add anything. Yeah so we did see. Linearity Revenue linearity through the quarter improved. So month 1 to month, 2 to month 3. We did see it. Continue to build same with backlog. We saw that continue to build through the quarter and also as we've talked in previous quarters, you know, turns business, or when a customer comes in wants an order ship right away. We continue to see that run as well, um, at higher levels. So you know that's factored into the guide.

You have a follow-up, Ross.

Haviv Ilan: We are seeing this market now becoming a little bit more substantial as a percentage of our revenue. I expect this market to continue to grow in Q1. It's been growing for now 7 quarters in a row for us, and we left the year at about $450 million a quarter revenue footprint, and I think that continues as we move forward. The last point I would say, we know we did see orders improving throughout the quarter, and what guides our guidance is just stronger booking. Mike, I don't know if you wanna add anything.

We are seeing this market now becoming a little bit more substantial as a percentage of our revenue. I expect this market to continue to grow in Q1. It's been growing for now 7 quarters in a row for us, and we left the year at about $450 million a quarter revenue footprint, and I think that continues as we move forward. The last point I would say, we know we did see orders improving throughout the quarter, and what guides our guidance is just stronger booking. Mike, I don't know if you wanna add anything.

Uh, it grew close to 20%. Uh, I think it was 18% over the year. And remember that on the industrial market we still have a lot of room to go when you think about the previous peaks. So, if you will, the compare is still, um, it's still easy for industrial to continue to recover.

Uh, the other market that I will highlight is, you know, the continued strength in data center. Uh, we are seeing this market now becoming a little bit, um...

Yeah, I do just a question on the gross margin implications. Given, what you guys talking about with Revenue? It seems like you have nice bead. At least first, is what I was expecting in the fourth quarter Rockville, can you just talk a little bit about the puts and takes on gross margin in your first quarter guide and maybe throughout the year? If utilization is changing, if inventory levels are where you want it or if they need to rise anything on, that would be helpful. Thank you.

More substantial as a percentage of our revenue.

Uh, I expect this market to continue to grow in Q1. It's been growing for now seven quarters in a row for us, and, uh, we left the year at about $450 million recorded revenue, um, footprint. And I think that continues, um, as we move forward,

Mike Beckman: Yeah, so we, we did see linearity, revenue linearity through the quarter improve. So month one to month two to month three, we did see it continue to build. Same with backlog. We saw that continue to build through the quarter. And also, as we've talked in previous quarters, you know, turns business or when a customer comes in and wants an order shipped right away, we continue to see that run as well, at higher levels. So, you know, that's factored into the guide. You have a follow-up, Ross?

BS and the range on on Revenue. I will tell you assume Opex is up low single digits and you should get into a a reasonable number for gross margin and um uh the loadings that will depend on the Main and we'll adjust those as as needed. Thank you, thanks for the questions. Ross, we'll move on to our next caller. Please.

Ross Seymore: Yeah, I do. Just a question on the gross margin implications, given what you guys are talking about with revenue. Seems like you had a nice beat, at least versus what I was expecting in the fourth quarter. Rafael, can you just talk a little bit about the puts and takes on gross margin in your first quarter guide and maybe throughout the year, if utilization is changing, if inventory levels are where you want it, or if they need to rise? Anything on that would be helpful. Thank you.

The last point, I would say, we know, we did see orders uh, improving uh, throughout the quarter. And um what guides are are guidance is just stronger booking like I don't know if you want to add anything. Yeah and so we did see linearity Revenue linearity through the quarter improved. So month 1 to month, 2 to month 3. We did see it. Continue to build same with backlog. We saw that continue to build through the quarter and also as we've talked in previous quarters, you know, turns business, or when a customer comes in wants an order ship right away. We continue to see that run as well, um, at higher levels. So you know that's factored into the guide.

You have a follow-up, Ross.

Our next question comes from the line of Jim Snider with Goldman snacks, snacks, please proceed with your question.

Rafael Lizardi: Yeah, sure. Let me start with Q4. EPS came in a little better than expected, and once you account for that sixth end reduction that we talked about in the prepared remarks. And that was a combination of revenue was a little better, mix, end market mix was a little better, load-ins was a little better, and OpEx was a little better. So it was a combination of multiple things there. On Q1, you know, we'll give you the range on EPS and the range on revenue. I would tell you, assume OpEx is up low single digits, and you should get into a reasonable number for gross margin. And the load-ins, that will depend on demand, and we'll adjust those as needed. Thank you.

Yeah, I do—just a question on the gross margin implications, given what you guys are talking about with revenue. Seems like you have a nice beat, at least versus what I was expecting in the fourth quarter, Rockefeller. Can you just talk a little bit about the puts and takes on gross margin in your first quarter guide and maybe throughout the year? If utilization is changing, if inventory levels are where you want them, or if they need to rise—anything on that would be helpful. Thank you.

Good afternoon, and thanks for taking my question. I was wondering if you could maybe, uh, relative to your prior comments, maybe address inventory levels and where you expect those to go, you talked about taking loadings down a little bit to bring inventories down and you you accomplish that in a quarter. Do you think inventories are at uh, at a pretty good place either from a days, or dollars basis, or would you expect to want to take them down a little bit further? At this point?

Let me start and I'll give, I'll let Raphael let some more caller on this James. So, again, I think, uh, we said it along the fourth quarter, when we had the chance that we are very pleased with the, uh, inventory position. We have built, we are very, uh, proud of how we got there. It's across. Um, all of our Technologies at the right level. So from a high level, the inventory we are, we are, um, we have, we have right now, that's an asset that allows us to serve customers, um, especially in the current environment. When, um, you know, we see a lot of

Mike Beckman: Thanks for the questions, Ross. We'll move on to our next caller, please.

Operator: Thank you. Our next question comes from the line of James Schneider with Goldman Sachs. Please proceed with your question.

Operator: Thank you. Our next question comes from the line of Jim Schneider with Goldman Sachs. Please proceed with your question.

Be asked, I mean, uh, a little better than expected. And once you account for that 6 and reduction that, um, that we talked about in the prepared remarks and that was a combination of, uh, Revenue was a little better, uh, mixed in Market. Mix was a little better. Loadings was a little better, and Opex was a little better. So it was a combination of uh, multiple things there um, on the first quarter. Uh, you know, we gave you the range on EPs and the range on on Revenue. I would tell you as soon Opex is up low single digits and you should get into uh a reasonable number for gross margin and um uh, the loadings that will depend on the Main and we'll adjust those as as needed. Thank you, thanks for the questions. Ross, we'll move on to our next caller. Please.

Of real time just in time, the demand, the terms businesses and Mike mentioned before is high, and it allows us to support customers at a high level, Rafael any more color on how we want to manage, inventory, moving forward. No, that's it.

All right, Jim, do you have a follow-up?

James Schneider: Good afternoon, and thanks for taking my question. I was wondering if you could maybe, relative to your prior comments, maybe address inventory levels and where you expect those to go. You talked about taking load-ins down a little bit to bring inventories down, and you accomplished that in the quarter. Do you think inventories are at a pretty good place, either from a days or dollars basis, or would you expect to want to take them down a little bit further at this point?

Jim Schneider: Good afternoon, and thanks for taking my question. I was wondering if you could maybe, relative to your prior comments, maybe address inventory levels and where you expect those to go. You talked about taking load-ins down a little bit to bring inventories down, and you accomplished that in the quarter. Do you think inventories are at a pretty good place, either from a days or dollars basis, or would you expect to want to take them down a little bit further at this point?

Our next question comes from the line of Jim Snider with Goldman Sachs. Please proceed with your question.

Uh, yes, I mean clearly industrial Automotive are doing right? Are very well right now and and that Plus data center, are your main focus. Can we talk about sort of the prospects of of a return to growth or a turnaround in the the personal uh electronics and Communications and markets. And maybe some of the product areas like uh uh embedded processing associated with those. Thank you.

Haviv Ilan: Let me start, and I'll give, I'll let Rafael add some more color on this, Jim. So again, I think, we said it along the fourth quarter when we had the chance, that we are very pleased with the inventory position we have built. We are very proud of how we got there. It's across all of our technologies at the right level. So from a high level, the inventory we have right now, that's an asset that allows us to serve customers, especially in the current environment, when, you know, we see a lot of real-time, just-in-time demand. The turns businesses, as Mike mentioned before, is high, and it allows us to support customers at a high level.

Good afternoon, and thanks for taking my question. I was wondering if you could maybe, uh, relative to your prior comments, maybe address inventory levels and where you expect those to go. You talked about taking loadings down a little bit to bring inventories down, and you accomplished that in a quarter. Do you think inventories are at a pretty good place, either from a days or dollars basis, or would you expect to want to take them down a little bit further at this point?

Yes. So just on the on the, uh, maybe on the personal electronics Market, it did grow for the year, right? Uh, the business grew at for the full year at around. I think 7% for PE and uh, we just saw a little bit of a weak Q4. I would say below. Typical seasonality. Maybe Mike, you can add a little bit more color. What we've seen there in Q4. Yeah, so if you look inside the sectors there, um, uh, home theater entertainment TV, uh, declined. The most, um, on the other end of the spectrum mobile phones, uh, I actually performed the best out of that group. So it, it varied within, uh, probably not inconsistent with what you've probably seen around subsidies expiring. Um,

Haviv Ilan: Rafael, any more color on how you want to manage inventory moving forward?

Rafael, any more color on how you want to manage inventory moving forward?

Rafael Lizardi: No, that's it.

Mike Beckman: All right. Jim, do you have a follow-up?

James Schneider: Yes. I mean, clearly, industrial and automotive are doing right very well right now, and that plus data center are your main focus. Can you maybe talk about sort of the prospects of a return to growth or a turnaround in the personal electronics and communications end markets, and maybe some of the product areas like embedded processing associated with those? Thank you.

Jim Schneider: Yes. I mean, clearly, industrial and automotive are doing right very well right now, and that plus data center are your main focus. Can you maybe talk about sort of the prospects of a return to growth or a turnaround in the personal electronics and communications end markets, and maybe some of the product areas like embedded processing associated with those? Thank you.

Let me start and I'll give a letter Rafa let some more color on this gym. So again, I think uh, we set it along the fourth quarter, when we had the chance that we are very pleased with the uh, inventory position we've built. We are very, uh, proud of how we got there. It's across. Um, all of our Technologies at the right level. So from a high level, the inventory we are, we are, um, we have we have right now. That's an asset that allows us to serve customers especially in the current environment when, um, you know, we see a lot of real time just in time and demand, that turns businesses and Mike mentioned before is high, and it allows us to support customers at a high level, Rafael any more color on how you want to manage, inventory, moving forward. No, that's it.

All right, Jim, do you have a follow-up?

Around in China for for things like appliances and TV. So uh it's also if you think about where personal electronics is and its timing of uh the cycle and where it is it was 1 of the first to correct and also go through its recovery. So there's also a tougher compared than it probably has compared to some of the other end markets.

All right. Well, thanks for the question. Jim, we move on to the next caller, please.

Thank you. Our next question comes from the line um, Harland Sir with JP Morgan please proceed with your question.

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Q4 2025 Texas Instruments Inc Earnings Call

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