Texas Instruments Q4 2025 Texas Instruments Inc Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 Texas Instruments Inc Earnings Call
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.
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.
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.
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.
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.
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?
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.
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?
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.
Thank you.
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.
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.
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.
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.
Thank you.
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.
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.
Rafael Lizardi: No, that's it.
Mike Beckman: All right. Jim, do you have a follow-up?
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.
Haviv Ilan: Yes. So just on the personal electronics market, maybe, it did grow for the year, right? The business grew at-
Haviv Ilan: Yes. So just on the personal electronics market, maybe, it did grow for the year, right? The business grew at-
Mike Beckman: Full year.
Mike Beckman: Full year.
Haviv Ilan: For the full year, at around, I think, 7% for PE. And 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.
Haviv Ilan: For the full year, at around, I think, 7% for PE. And 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.
Mike Beckman: Yeah. So if you look inside the sectors there, home theater, entertainment, TV, declined the most. On the other end of the spectrum, mobile phones, actually performed the best out of that group. So it varied within, probably not inconsistent with what you've probably seen around subsidies expiring, around in China for things like appliances and TVs. So, it's also, if you think about where personal electronics is and its timing of the cycle and where it is, it was one of the first to correct and also go through its recovery. So there's also a tougher compare than it probably has compared to some of the other end markets. All right. Well, thanks for the question, Jim.
Mike Beckman: Yeah. So if you look inside the sectors there, home theater, entertainment, TV, declined the most. On the other end of the spectrum, mobile phones, actually performed the best out of that group. So it varied within, probably not inconsistent with what you've probably seen around subsidies expiring, around in China for things like appliances and TVs. So, it's also, if you think about where personal electronics is and its timing of the cycle and where it is, it was one of the first to correct and also go through its recovery. So there's also a tougher compare than it probably has compared to some of the other end markets. All right. Well, thanks for the question, Jim.
Yeah, good afternoon. Uh, thanks for taking my question, good to see the strong double digits here of your growth in industrial. Uh, Javi last quarter. You talked about seeing some hesitation by customers in your industrial business, especially around manufacturing activity, things like Factory automation, which is 1 of the larger segments of your industrial business. Are you still seeing that hesitancy? That sort of wait and see posture by customers or is the order activity there? Starting to now pick up, especially among the China based industrial customers.
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, decline. The most, um, on the other end of the spectrum, mobile phones, uh, 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,
Yeah, like it's a great question. I think, from a high level perspective, let's remember industrial. And I look at the quarterly Revenue even if I go back to Q3 which was, um, I think the highest industrial quarter for 2025 it was still about 25% from the previous peaks in year 2022, right? So I do believe that the secular growth continues in industrial we are looking at um end equipment and generation to generation. We see just more content grow
James Schneider: Thank you.
Jim Schneider: Thank you.
Mike Beckman: We'll move on to the next caller, please.
Mike Beckman: We'll move on to the next caller, please.
Rafael Lizardi: Thank you. Our next question comes from the line of Harlan Sur with J.P. Morgan. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of Harlan Sur with JPMorgan. Please proceed with your question.
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 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 so much. And Jim, we'll move on to the next caller, please.
Harlan Sur: Yeah, good afternoon. Thanks for taking my question. Good to see the strong double-digit year-over-year growth in industrial. Haviv, last quarter, you talked about seeing some hesitation by customers in your industrial business, especially around manufacturing activity, things like factory automation, which is one of the larger segments of your industrial business. Are you still seeing that hesitancy, that sort of wait-and-see posture by customers, or is the order activity there starting to now pick up, especially among your China-based industrial customers?
Harlan Sur: Yeah, good afternoon. Thanks for taking my question. Good to see the strong double-digit year-over-year growth in industrial. Haviv, last quarter, you talked about seeing some hesitation by customers in your industrial business, especially around manufacturing activity, things like factory automation, which is one of the larger segments of your industrial business. Are you still seeing that hesitancy, that sort of wait-and-see posture by customers, or is the order activity there starting to now pick up, especially among your China-based industrial customers?
Thank you. Our next question comes from the line of Harland Sir with J.P. Morgan. Please proceed with your question.
Haviv Ilan: Yeah, Harlan, it's a great question. I think from a high-level perspective, let's remember, industrial, and I look at the quarterly revenue, even if I go back to Q3, which was, I think the highest industrial quarter for 2025, it was still about 25% from the previous peaks in year 2022, right? So I do believe that the secular growth continues in industrial. We are looking at end equipment and generation to generation. We see just more content growth persistent, so I expect industrial to establish new highs in the future. This is why I talked in the last quarter about maybe a more moderate recovery, especially on the industrial side. And it did behave, you know, kind of seasonally in Q4.
Haviv Ilan: Yeah, Harlan, it's a great question. I think from a high-level perspective, let's remember, industrial, and I look at the quarterly revenue, even if I go back to Q3, which was, I think the highest industrial quarter for 2025, it was still about 25% from the previous peaks in year 2022, right? So I do believe that the secular growth continues in industrial. We are looking at end equipment and generation to generation. We see just more content growth persistent, so I expect industrial to establish new highs in the future. This is why I talked in the last quarter about maybe a more moderate recovery, especially on the industrial side. And it did behave, you know, kind of seasonally in Q4.
Yeah, good afternoon. Uh, thanks for taking my question. Good to see the strong double digits here of your growth in industrial, uh, over the last quarter. You talked about seeing some hesitation by customers in your industrial business, especially around manufacturing activity—things like factory automation, which is one of the larger segments of your industrial business. Are you still seeing that hesitancy, that sort of wait-and-see posture by customers? Or is the order activity there starting to now pick up, especially among your China-based industrial customers?
12 month on some issues, uh, regarding a certain supplier and sometimes, you know, we all know about the memory shortages. So I don't know what makes the customers order more. We'll just have to look and see. I do want to remind us all that earlier in 2025, I would say. The first up of 25 is so a pickup of industrial and then it kind of calmed down. We don't want to see how sustainable um uh this wake up in orders is and Mike anything to add on the industrial side. I think you covered it. Well I wouldn't add anything to that Harlen. Do you have a follow-up?
Haviv Ilan: But as Mike alluded to, we are seeing a little bit of a pickup on orders, including, including in industrial. And, you know, I can't, I can't tell you why. We'll have to see how it plays out. But, you know, we have seen some, you know, noise in the last several months on some issues, regarding, a certain supplier, and sometimes, you know, we all know about the memory shortages. So I don't know what makes the customers, order, more. We'll just have to look and see. I do wanna remind us all that earlier in 2025, I would say the first half of 2025, we saw a pickup, of industrial, and then it kind of calmed down. We will wanna see how sustainable, this wake-up in orders is.
But as Mike alluded to, we are seeing a little bit of a pickup on orders, including, including in industrial. And, you know, I can't, I can't tell you why. We'll have to see how it plays out. But, you know, we have seen some, you know, noise in the last several months on some issues, regarding, a certain supplier, and sometimes, you know, we all know about the memory shortages. So I don't know what makes the customers, order, more. We'll just have to look and see. I do wanna remind us all that earlier in 2025, I would say the first half of 2025, we saw a pickup, of industrial, and then it kind of calmed down. We will wanna see how sustainable, this wake-up in orders is.
Yeah, thank you. Uh, thanks for the thanks Dan from the last question. Um, you guys have previously mentioned, the team as a head on the Sherman table, build out and on track to complete the build out of of table 2. This year, can I just give us an update here? Um, and then on the potential 2, to 3 billion of gross capex this year, not sure if you guys are willing to articulate, what that could be but what is the size of the potential offsets, right? You've got ITC goes up 35% and you still have 1.6 billion in direct funding or grants to capture. Just wondering if you can maybe quantify that capture this year.
Yeah, it's a great question. I think from a high level perspective, let's remember industrial. And I look at the quarterly Revenue even if I go back to Q3 which was, um, I think the highest industrial quarter for 2025 it was still, uh, about 25% from the previous peaks in year 2022, right? So I do believe that the secular growth continues in industrial we are looking at um end equipment and generation to generation. We see just more content growth per system. So I expect industrial to to establish new highs in the future. Uh, this is why I talked in the last quarter about maybe a more moderate recovery especially on the industrial side, uh, and it did behaves, you know, kind of sees the seasonally in Q4 but as Mike alluded to we are seeing a little bit of a pickup on orders including including in industrial. And you know, I can't I can't tell you why we'll have to uh see how it plays out. But you know we have seen
Yeah, I'll start regarding the execution on the, the buildup of the files and let Raphael comment, um, on on the the rest of the topics, although we want to save something for the February call, hold on. So, but first, on the part, yeah, we are very pleased about the execution in Sherman. It's, it's actually a ramp ahead of schedule high yields.
Haviv Ilan: Mike, anything to add on the industrial side?
Haviv Ilan: Mike, anything to add on the industrial side?
Mike Beckman: I think you covered it well. I wouldn't add anything to that. Harlan, do you have a follow-up?
Mike Beckman: I think you covered it well. I wouldn't add anything to that. Harlan, do you have a follow-up?
Harlan Sur: Yeah. Thank you. Thanks, thanks on the last question. You guys have previously mentioned the team is ahead on the Sherman fab build-outs and on track to complete the build-out of Fab-2 this year. Can you guys just give us an update here? And then on the potential $2 to 3 billion of gross CapEx this year, not sure if you guys are willing to articulate what that could be. But what is the size of the potential offsets, right? You've got ITC goes up 35%, and you still have $1.6 billion in direct funding or grants to capture. Just wondering if you can maybe quantify that capture this year.
Harlan Sur: Yeah. Thank you. Thanks, thanks on the last question. You guys have previously mentioned the team is ahead on the Sherman fab build-outs and on track to complete the build-out of Fab-2 this year. Can you guys just give us an update here? And then on the potential $2 to 3 billion of gross CapEx this year, not sure if you guys are willing to articulate what that could be. But what is the size of the potential offsets, right? You've got ITC goes up 35%, and you still have $1.6 billion in direct funding or grants to capture. Just wondering if you can maybe quantify that capture this year.
Some, um, you know, noise in the last several months on some issues, uh, regarding a certain supplier. And sometimes, you know, we all know about the memory shortages. So, I don't know what makes the customers order more. We'll just have to look and see. I do want to remind us all that earlier in 2025, I would say, the first up of '25 is, so, a pickup of industrial and then it kind of calmed down. We want to see how sustainable, um, uh, this wake-up in orders is. And Mike, anything to add on the industrial side? I think you covered it well. I wouldn't add anything to that. Harlen, do you have a follow-up?
Haviv Ilan: Yeah, I'll start regarding the execution on the buildup of the fabs, and I'll let Rafael comment on the rest of the topics, although we want to save something for the February call, Harlan, so. But first on the fab, yeah, we are very pleased about the execution in Sherman. It's actually ramped ahead of schedule, high yields. We also see with the new equipment that we have, really the factory is more capable than we originally hoped. So a high level of throughput is being planned for this factory. So I'm very pleased with that execution, and that will help us, you know, support our customers for the next 5 and 10 years.
Haviv Ilan: Yeah, I'll start regarding the execution on the buildup of the fabs, and I'll let Rafael comment on the rest of the topics, although we want to save something for the February call, Harlan, so. But first on the fab, yeah, we are very pleased about the execution in Sherman. It's actually ramped ahead of schedule, high yields. We also see with the new equipment that we have, really the factory is more capable than we originally hoped. So a high level of throughput is being planned for this factory. So I'm very pleased with that execution, and that will help us, you know, support our customers for the next 5 and 10 years.
Yeah, thank you. Uh, thanks for the thanks, Stan, from the last question. Um, you guys have previously mentioned the team is ahead on the Sherman table build-out, and on track to complete the build-out of Table 2 this year. Can you just give us an update here? Um, and then on the potential $2 to $3 billion of gross capex this year—I’m not sure if you guys are willing to articulate what that could be, but what is the size of the potential offsets, right? You’ve got ITC goes up 35% and you still have $1.6 billion in direct funding or grants to capture. Just wondering if you can maybe quantify that capture this year.
Uh, we also see with the new equipment that we have, uh, really, uh, the factory is more capable than we originally hoped. So, uh, high level of, uh, of throughput is, is being, um, planned for these factories. So, I'm very pleased of that execution. And that, that will help us, uh, you know, support our customers, um, for the next 5 and 10 years. Uh, we have a clean room in Sherman 1. That is already have some production lines running but remember, we also have the shell in Sherman too, and we can build into this capacity, uh, if they want, if demand wants to be very strong, I think we can be a in a great position to, to support it on the Lehigh side. Also, on schedule, I'm very pleased with the transition, uh, or the insourcing progress from, uh, our Foundry, uh, Wafers into, uh, into Lehigh. That's mainly an embedded processing comment that that Tailwind will continue for us in 2026. I think I've mentioned in the 2 0,
5, we've completed our 6500 transition and they are they are yielding at the same level and as they used to in the foundries and now we are busy with our 45, Andy mainly supporting our um, our Automotive radar business.
Yeah, I'll start regarding the execution on the, the buildup of the files and I let Raphael comment, um, on on the the rest of the topics, although we want to save something for the February call, hold on. So, but first, on the part, yeah, we are very pleased about the execution in Sherman. It's, it's actually a ramp ahead of schedule high yields.
That's also a progressing. Well in Lehigh Rafael, anything on the on the ITC. Sure. Yeah. No. So how long you asked about 5 or 6 questions in 1 but let me see if we can have you address a couple let me address the the next few first on capex, we continue to expect capex.
Haviv Ilan: We have a clean room in Sherman 1 that is already have some production lines running. But remember, we also have the shell in Sherman 2, and we can build into this capacity if demand wants to be very strong. I think we can be in a great position to support it. On the Lehigh side, also on schedule, I'm very pleased with the transition or the in-sourcing progress from our foundry wafers into Lehigh. That's mainly an embedded processing comment that tailwind will continue for us in 2026. I think I've mentioned in 2025, we've completed our 65-nanometer transition, and they are yielding at the same level as they used to in the foundries.
We have a clean room in Sherman 1 that is already have some production lines running. But remember, we also have the shell in Sherman 2, and we can build into this capacity if demand wants to be very strong. I think we can be in a great position to support it. On the Lehigh side, also on schedule, I'm very pleased with the transition or the in-sourcing progress from our foundry wafers into Lehigh. That's mainly an embedded processing comment that tailwind will continue for us in 2026. I think I've mentioned in 2025, we've completed our 65-nanometer transition, and they are yielding at the same level as they used to in the foundries.
For 2026 between 2 and 3 billion dollars. So that's consistent with what we said before on the depreciation for 20 on depreciation, for 26. Let me give you a new number. We now expect to 2.2 to 2.4 billion on the depreciation.
Haviv Ilan: And now we are busy with our 45-nanometer technology, mainly supporting our automotive radar business. That's also progressing well in Lehigh. Rafael, anything on the ITC or?
And now we are busy with our 45-nanometer technology, mainly supporting our automotive radar business. That's also progressing well in Lehigh. Rafael, anything on the ITC or?
Uh, in 2026. And for 2027, we expect an upward pressure on that number. But at a, at a slower rate of increase. So if you look at what we've increased the last few years, just uh uh it'll increase again but slower. Uh you asked about ITC and direct funding uh direct funding not change. We expect up to 1.6 billion dollars as we in several Milestones as we uh reach those milestones and on ITC investment tax credit. It is now 35% as of January 1st of 26. So anything that we uh put in place any capex. We put in place both equipment, building clean room in 2026. Uh we get
Back 35% uh, uh, on the it secret.
Rafael Lizardi: Sure, yeah, no. So Harlan, you asked about five or six questions in one, but let me see if we can, Haviv addressed a couple. Let me address the next few. First, on CapEx, we continue to expect CapEx for 2026 between $2 and 3 billion, so that's consistent with what we said before.
Rafael Lizardi: Sure, yeah, no. So Harlan, you asked about five or six questions in one, but let me see if we can, Haviv addressed a couple. Let me address the next few. First, on CapEx, we continue to expect CapEx for 2026 between $2 and 3 billion, so that's consistent with what we said before.
Great, thank you. Oh, thank you.
To be very strong. I think we can be a in a great position to, to support it on the Lehigh side. Also, on schedule, I'm very pleased with the transition, uh, or the insourcing progress from, uh, our Foundry, uh, Wafers into, uh, into Lehigh. That's mainly an embedded process in comment that that Tailwind will continue for us in 2026. I think I've mentioned in 25, we've completed our 60 final me transition and they are, they are yielding at the same level um, as they used to in the foundation. And now we are busy with, our 45 animation, mainly supporting our um, our Automotive radar business.
Move on to our next caller, please.
Thank you.
Our next question, comes from the line of Vette area with Bank of America Securities. Please receive with your question.
Haviv Ilan: Mm-hmm.
Harlan Sur: Mm-hmm.
Rafael Lizardi: On depreciation for 2026, let me give you a new number. We now expect $2.2 to 2.4 billion on depreciation in 2026, and for 2027, we expect an upward pressure on that number, but at a slower rate of increase. So if you look at what we've increased the last few years, just, it'll increase again, but slower. You asked about ITC and direct funding. Direct funding, no change. We expect up to $1.6 billion as we in several milestones, as we reach those milestones. And on ITC, investment tax credit, it is now 35% as of 1 January 2026.
Rafael Lizardi: On depreciation for 2026, let me give you a new number. We now expect $2.2 to 2.4 billion on depreciation in 2026, and for 2027, we expect an upward pressure on that number, but at a slower rate of increase. So if you look at what we've increased the last few years, just, it'll increase again, but slower. You asked about ITC and direct funding. Direct funding, no change. We expect up to $1.6 billion as we in several milestones, as we reach those milestones. And on ITC, investment tax credit, it is now 35% as of 1 January 2026.
That's also a progressing well in Lehigh Rafael, anything on the on the ITC. Sure. Yeah. No. So how long you asked about 5 or 6 questions in 1 but let me see if we can have you addressed a couple. Let me address the the next few first on capex, we continue to expect capex.
For 2026, between $2 and $3 billion. So that's consistent with what we said before on the depreciation for '20—on depreciation for '26. Let me give you a new number. We now expect $2.2 to $2.4 billion on the appreciation.
Uh thanks for taking my question uh for the first 1. Um have you what do you think is um you know driving this above seasonal q1? First of all, how much about seasonal uh is it? And then what role is the pricing? Uh, playing in that because there is some discussion about uh, price increases uh, from some of your peers. So, uh, is the raising prices in q1? Is that part of what's driving? Uh, and how would you characterize this? Um, you know, how much about seasonal is it? And and what what kind of the main driver of that?
Rafael Lizardi: So anything that we put in place, any CapEx we put in place, both equipment, building, clean room in 2026, we get back 35%, on the ITC credit.
So anything that we put in place, any CapEx we put in place, both equipment, building, clean room in 2026, we get back 35%, on the ITC credit.
Harlan Sur: Great. Thank you.
Great. Thank you.
Mike Beckman: Oh, thank you. We'll move on to our next caller, please.
Harlan Sur: Oh, thank you.
Mike Beckman: We'll move on to our next caller, please.
Rafael Lizardi: Thank you. Our next question comes from the line of Vivek Arya with Bank of America Securities. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of Vivek Arya with Bank of America Securities. Please proceed with your question.
Uh, in 2026. And for 2027, we expect an upward pressure on that number. But at a, at a slower rate of increase. So if you look at what we've increased the last few years, just uh uh it'll increase again but slower. Uh you asked about ITC and direct funding uh direct funding not change. We expect up to 1.6 billion dollars as we in several Milestones as we uh reach those milestones and on ITC investment tax credit. It is now 35% as of January 1st of 2016. So anything that we uh put in place any capex. We put in place both equipment, building clean room in 2026. Uh we get back. 35% uh uh on the it secret.
Great, thank you. Oh, thank you.
We'll move on to our next caller, please.
Thank you.
Vivek Arya: ... Thanks for taking my question. For the first one, Haviv, what do you think is, you know, driving this above seasonal Q1? First of all, how much above seasonal is it? And then what role is the pricing playing in that? Because there is some discussion about price increases from some of your peers. So, is TI raising prices in Q1? Is that part of what's driving? And how would you characterize this, you know, how much above seasonal is it, and what's kind of the main driver of that?
Vivek Arya: ... Thanks for taking my question. For the first one, Haviv, what do you think is, you know, driving this above seasonal Q1? First of all, how much above seasonal is it? And then what role is the pricing playing in that? Because there is some discussion about price increases from some of your peers. So, is TI raising prices in Q1? Is that part of what's driving? And how would you characterize this, you know, how much above seasonal is it, and what's kind of the main driver of that?
Our next question comes from the line of V. Aeria with Bank of America Securities. Please proceed with your question.
And the answer is, no, it's not. It's not pricing related. Uh, regarding the uh, the seasonality know, it's more or less, you know, maybe a little bit above seasonal, right? We usually see a kind of a low single digit to Flat quarter. I think we've guided what 1 will do to decline the flat. And again, the, the reason we work is, is the orders. We are just seeing a growing orders and it it behave. The same through the quarter. I can't speculate on what but I do know the industrial Market. You know it, there needs to be a correction, and the second point is data center is now a bigger part of our business. So it starts to move the numbers for us, write it. This is a, a, a market that is now growing every quarter and it's not insignificant. So I think that's also helps to change the guide compared to previous years. Mike. Anything else on this seasonality know? I think you called it out, seasonality. So the fact that you have a follow-up,
Haviv Ilan: Yeah, let me just say for the second part of the question, the answer is no, it's not, it's not pricing related. Regarding the seasonality, no, it's more or less, you know, maybe a little bit above seasonal, right? We usually see kind of a low single digit to flat quarter. I think we've guided what, 1.5-
Haviv Ilan: Yeah, let me just say for the second part of the question, the answer is no, it's not, it's not pricing related. Regarding the seasonality, no, it's more or less, you know, maybe a little bit above seasonal, right? We usually see kind of a low single digit to flat quarter. I think we've guided what, 1.5-
Uh thanks for taking my question, uh for the first 1. Um, have you what do you think is um you know driving this above seasonal q1? First of all, how much about seasonal uh is it? And then what role is the pricing? Uh, playing in that because there is some discussion about uh, price increases uh, from some of your peers. So uh, is the raising prices in q1? Is that part of, uh, what's driving? Uh, and how would you characterize this? Um, you know, how much about seasonal is it? And and what what kind of the main driver of that?
Mike Beckman: Yeah, low single digit decline-
Mike Beckman: Yeah, low single digit decline-
Haviv Ilan: Okay.
Haviv Ilan: Okay.
Mike Beckman: To flat is-
Mike Beckman: To flat is-
Haviv Ilan: And again, the reason, Vivek, is the orders. We are just seeing growing orders, and it behaved the same through the quarter. I can't speculate on what, but I do know the industrial market, you know, it, there needs to be a correction. And the second point is, data center is now a bigger part of our business, so it starts to move the numbers for us, right? It, this is a market that is now growing every quarter, and it's not insignificant. So I think that also helps to change the guide compared to previous years. Mike, anything else on the seasonality?
Haviv Ilan: And again, the reason, Vivek, is the orders. We are just seeing growing orders, and it behaved the same through the quarter. I can't speculate on what, but I do know the industrial market, you know, it, there needs to be a correction. And the second point is, data center is now a bigger part of our business, so it starts to move the numbers for us, right? It, this is a market that is now growing every quarter, and it's not insignificant. So I think that also helps to change the guide compared to previous years. Mike, anything else on the seasonality?
Yes uh thank you um for my second question, there's a lot of talk of higher memory, pricing impacting demand for Consumer Electronics, you know, PCS phones, Automotive. Have you seen it already? Have you heard that as a concerned from your, um, you know, from your customers and and how are you thinking about the auto market, um, right now and and just is memory pricing a headwind at all for your businesses that are exposed to, uh, consumers, thank you. Hi level, we, I would say that we haven't seen any implications although, you know, then that would be a speculation on my, on my side, but it could be that the customers are
Mike Beckman: No, I think you called it out on seasonality. So, Vivek, do you have a follow-up?
Mike Beckman: No, I think you called it out on seasonality. So, Vivek, do you have a follow-up?
Vivek Arya: Yes. Thank you. For my second question, there's a lot of talk of higher memory pricing impacting demand for consumer electronics, you know, PCs, phones, automotive. Have you seen it already? Have you heard that as a concern from your, you know, from your customers? And, and how are you thinking about the auto market, right now? And, and just, is memory pricing a headwind at all, for your businesses that are exposed to, consumers? Thank you.
Vivek Arya: Yes. Thank you. For my second question, there's a lot of talk of higher memory pricing impacting demand for consumer electronics, you know, PCs, phones, automotive. Have you seen it already? Have you heard that as a concern from your, you know, from your customers? And, and how are you thinking about the auto market, right now? And, and just, is memory pricing a headwind at all, for your businesses that are exposed to, consumers? Thank you.
Seeing some, uh, issues on the memory side. Do they want to, you know, repentance some of their inventory that could be always the case. And Mike, I don't know if you've seen any examples or yeah. Well, well I would add though is and and you know, we've heard about it obviously. And I think not necessarily specifically that scenario, but it could be that. But also, when a customer doesn't necessarily have everything, they need to complete their bill of materials, when they finally have those parts they need, sometimes they'll come in very quickly and want to order parts. We did see some of that where customers come into the last minute, walk product ship right away, because they've just completed a bill of materials, could be related to that or other other different things. So um, so with that, thank you with that, with questions. We will move on to the next caller, please.
Yeah, let me just say, for the second part of the question. The answer is, no, it's not. It's not pricing related, uh, regarding the uh, decisional. You know, it's more or less, you know, maybe a little bit about seasonal, right? We usually see kind of a low single digit to Flat quarter. I think we've guided what 1 will do to decline the flat as to. And again, the the reason we work is is the orders. We are just seeing a growing orders and it it behave. The same through the quarter. I can't speculate on what but I do know the industrial Market. You know, it there need to be a correction in the second point is data center is now a bigger part of our business so it starts to move the numbers for us. Write it. This is um, a a market that is now growing every quarter and it's not insignificant. So I think that's also helps uh, to change the guide compared to previous years. Mike. Anything else on this seasonality know? I think you called it out. Um, seasonality. So the back. Do you have a follow-up?
Thank you.
All right, next question comes from the line of Timothy curry with UBS, please. Proceed with your question.
Haviv Ilan: High level, I would say that we haven't seen any implications, although, you know, then that would be a speculation on my, on my side, but it could be that the customers are seeing some issues on the memory side. Do they wanna, you know, replenish some of their inventory? That could be always the case. And Mike, I don't know if you've seen any examples of that.
Haviv Ilan: High level, I would say that we haven't seen any implications, although, you know, then that would be a speculation on my, on my side, but it could be that the customers are seeing some issues on the memory side. Do they wanna, you know, replenish some of their inventory? That could be always the case. And Mike, I don't know if you've seen any examples of that.
Yes uh thank you um for my second question, there's a lot of talk of higher memory, pricing impacting demand for Consumer Electronics, you know, PCS phones, Automotive, have you seen it already? Have you heard that as a concern from your, um, you know, from your customers and and how are you thinking about the auto market, um, right now and and just is memory pricing a headwind at all, uh, for your businesses that are exposed to, uh, consumers, thank you. Hi level. We, I would say that we haven't seen any implications, although, you know, then that would be a speculation on.
Thanks a lot. Um Rafael I wanted to also ask on capex and sort of how quickly it's going to fall off. I think you said this year 2 to 3 billion but the math would then say you're going to kind of exit the year like run rating something like a billion 5. Um, so the question is then can it go lower than that? Because I seem to recall a comment at our conference in December that it could go like lower than 5% of Revenue next year. So that would put it down to like a billion dollars and that you like that kind of being a floor. So can you kind of talk about that? Could it go that low next year?
Mike Beckman: Yeah. Well, what I would add, though, is, and, you know, we've heard about it, obviously, and I think not necessarily specifically that scenario, but it could be that. But also, when a customer doesn't necessarily have everything they need to complete their bill of materials, when they finally have those parts they need, sometimes they'll come in very quickly and wanna order parts. We did see some of that, where customers come in at the last minute and want product shipped right away because they've just completed their bill of materials. Could be related to that or other, different things. So, with that, thank you, Vivek, for the questions. We will move on to the next caller, please.
Mike Beckman: Yeah. Well, what I would add, though, is, and, you know, we've heard about it, obviously, and I think not necessarily specifically that scenario, but it could be that. But also, when a customer doesn't necessarily have everything they need to complete their bill of materials, when they finally have those parts they need, sometimes they'll come in very quickly and wanna order parts. We did see some of that, where customers come in at the last minute and want product shipped right away because they've just completed their bill of materials. Could be related to that or other, different things. So, with that, thank you, Vivek, for the questions. We will move on to the next caller, please.
Tim, let me start with the second half and then I'll let Raphael answer the first. But I, I made this comment because I was asked about maintenance capex, what is maintenance? We always have to spend money or to, you know, to fix uh,
Equipment, uh, to, to buy, uh, replacement parts, Etc. So, I characterize it as kind of missing a digital Revenue, that's always kind of a run rate. You can think about, there's never zero in a, in an idea like TI. That's that was my point. This is when you don't, you don't have growth right now. I let Raphael talk about capex beyond the maintenance.
Operator: Thank you. Our next question comes from the line of Timothy Arcuri with UBS. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of Timothy Arcuri with UBS. Please proceed with your question.
We'll move on to the next caller, please.
Thank you.
Timothy Arcuri: Thanks a lot. Rafael, I wanted to also ask on CapEx and sort of how quickly it's gonna fall off. I think you said this year, $2 to 3 billion, but the math would then say you're gonna kind of exit the year, like, run rating something like $1.5 billion. So the question is then: Can it go lower than that? Because I seem to recall a comment at our conference in December that it could go, like, lower than 5% of revenue next year, so that would put it down to, like, $1 billion, and that, like, that kind of being a floor. So can you kind of talk about that? Could it go that low next year?
Timothy Arcuri: Thanks a lot. Rafael, I wanted to also ask on CapEx and sort of how quickly it's gonna fall off. I think you said this year, $2 to 3 billion, but the math would then say you're gonna kind of exit the year, like, run rating something like $1.5 billion. So the question is then: Can it go lower than that? Because I seem to recall a comment at our conference in December that it could go, like, lower than 5% of revenue next year, so that would put it down to, like, $1 billion, and that, like, that kind of being a floor. So can you kind of talk about that? Could it go that low next year?
All right, next question comes from the line of Timothy Cury with UBS. Please proceed with your question.
Haviv Ilan: Tim, let me start with the second half, and then I'll let Rafael answer the first part. I, I made this comment because I was asked about maintenance CapEx. What is maintenance? We always have to spend money or to, to, you know, to fix equipment, to, to buy replacement parts, et cetera. So I characterize it as kind of mid-single-digit revenue. That's always kind of a run rate you can think about. There's never zero in a, in a firm like TI. That's, that was my point. This is when you don't, you don't have growth, right? Now, I'll let Rafael talk about CapEx beyond the maintenance.
Haviv Ilan: Tim, let me start with the second half, and then I'll let Rafael answer the first part. I, I made this comment because I was asked about maintenance CapEx. What is maintenance? We always have to spend money or to, to, you know, to fix equipment, to, to buy replacement parts, et cetera. So I characterize it as kind of mid-single-digit revenue. That's always kind of a run rate you can think about. There's never zero in a, in a firm like TI. That's, that was my point. This is when you don't, you don't have growth, right? Now, I'll let Rafael talk about CapEx beyond the maintenance.
Thanks a lot. Um, Rafael, I wanted to also ask on capex and sort of how quickly it's going to fall off. I think you said this year $2 to $3 billion, but the math would then say you're going to kind of exit the year like run-rating something like $1.5 billion. Um, so the question is then, can it go lower than that? Because I seem to recall a comment at our conference in December that it could go like lower than 5% of revenue next year. So that would put it down to like $1 billion, and that you like that kind of being a floor. So can you kind of talk about that? Could it go that low next year?
No. Uh, so, you know, for this year for 2026 2, to 3 billion dollars and, you know, there's a range there, so as we go through the year, we'll we'll update you on, uh, uh, on that number. And then beyond that, what we've said is, uh, uh, it's about 1.2 times long-term Revenue growth. Uh, so you take, uh, you know, take a number for Revenue growth, you do 1.2 times, so 10%, you get to 12% capex intensity. But that's the gross number uh, before, uh, ITC benefits. So, once you get the, the, the ITC benefits, you're essentially get back to 1 to 1 on that growth rate. So, whatever growth rate, you assume you cannot get back to, uh, to uh, uh, net capital, intensity of about the same level.
A follow-up, Tim.
Stephen, let me start with the second half and then I'll let Rafael answer the first. But I made a comment because I was asked about maintenance capex. What is maintenance? We always have to spend money, or to, you know, to fix...
Rafael Lizardi: No, so, you know, for this year, for 2026, $2 to 3 billion, and, you know, there's a range there. So as we go through the year, we'll update you on that number. And then beyond that, what we've said is about 1.2 times long-term revenue growth. So you take, you know, pick a number for revenue growth, you do 1.2 times, so 10%, you get to 12% CapEx intensity. But that's a gross number before ITC benefits. So once you get those ITC benefits, you essentially get back to 1:1 on that growth rate. So whatever growth rate you assume, you kind of get back to a net CapEx intensity of about the same level.
Rafael Lizardi: No, so, you know, for this year, for 2026, $2 to 3 billion, and, you know, there's a range there. So as we go through the year, we'll update you on that number. And then beyond that, what we've said is about 1.2 times long-term revenue growth. So you take, you know, pick a number for revenue growth, you do 1.2 times, so 10%, you get to 12% CapEx intensity. But that's a gross number before ITC benefits. So once you get those ITC benefits, you essentially get back to 1:1 on that growth rate. So whatever growth rate you assume, you kind of get back to a net CapEx intensity of about the same level.
I do Mike. Thanks. Um so I also wanted to ask about loadings. It looks like cash gross margin is up like 50 basis points or something in March, so that would kind of suggest that loadings are going up just a smidge. Um, and the bigger question is, sort of, are you thinking about loading that you want to keep inventory sort of in this 48 range and you just want to match loadings with demand from here, or do you want to bring inventory down you know over time versus that 4.8 number thanks.
Equipment, uh, to, to buy a replacement parts, Etc. So, I characterize it, it's kind of missing a digital Revenue. That's always kind of a run rate. You can think about, there's never zero in a, in an idea like the, I that's, that was my point. This is when you don't, you don't have growth right now. I let Raphael talk about capex beyond the maintenance.
You know, as I said earlier, we're very, uh, pleased with inventory levels. Uh, that that's uh,
No. Uh, so, you know, for this year, for 2026, $2 to $3 billion, and there, you know, there's a range there. So as we go through the year, we'll update you on, uh,
Position that we have to support potential Revenue growth. Uh, the same goes with capacity, we are well, positioned with capacity. So we'll adjust those loadings as needed. Depending on what we see uh, for demand for the rest of the year.
All right. Tim, thank you so much for the questions. We'll move on to our next caller.
Thank you.
Our next question comes from the line of Thomas omali with Barkley. Please proceed with your question.
Mike Beckman: A follow-up, Tim?
Mike Beckman: A follow-up, Tim?
Timothy Arcuri: I do, Mike. Thanks. So I also wanted to ask about loadings. It looks like cash gross margin is up, like, 50 basis points or something in March, so that would kind of suggest that loadings are going up just a smidge. And the bigger question is sort of: Are you thinking about loadings that you wanna keep inventory sort of in this 4-8 range, and you just wanna match loadings with demand from here, or do you want to bring inventory down, you know, over time versus that 4.8 number? Thanks.
Timothy Arcuri: I do, Mike. Thanks. So I also wanted to ask about loadings. It looks like cash gross margin is up, like, 50 basis points or something in March, so that would kind of suggest that loadings are going up just a smidge. And the bigger question is sort of: Are you thinking about loadings that you wanna keep inventory sort of in this 4-8 range, and you just wanna match loadings with demand from here, or do you want to bring inventory down, you know, over time versus that 4.8 number? Thanks.
On that number. And then beyond that, what we've said is, uh, uh, it's about 1.2 times long-term Revenue growth. Uh, so you take uh, you know, take a number for Revenue growth, you do 1.2 times, so 10%, you get to 12% capex, intensity. But that's that growth number, uh, before, uh, ITC benefits. So once you get the, the, the ITC benefits, you essentially get back to 1 to 1 on that growth rate. So, whatever growth rate, you assume you kind of get back to, uh, to uh, uh, net capital, intensity of about the same level.
A follow up 10.
Hey guys, thanks for taking my question. Have you in your in your outlook from? Are you talked about strength and data center recovery and Industrial continues and bookings? Are improving turns are good. Uh, there was no mention of Auto there. You guys have said, previously, maybe the auto business is a little bit, uh, slower off the bottom than industrial, uh, any update on the auto business and how that trying to do the quarter and kind of your updated view there.
Rafael Lizardi: You know, as Haviv said earlier, we're very pleased with inventory levels. That's good inventory in a number of fronts, on the buffers that we have, and the position that we have to support potential revenue growth. The same goes with capacity. We are well positioned with capacity, so we'll adjust those loadings as needed, depending on what we see for demand for the rest of the year.
Rafael Lizardi: You know, as Haviv said earlier, we're very pleased with inventory levels. That's good inventory in a number of fronts, on the buffers that we have, and the position that we have to support potential revenue growth. The same goes with capacity. We are well positioned with capacity, so we'll adjust those loadings as needed, depending on what we see for demand for the rest of the year.
I do my thanks. Um, so I also wanted to ask about loadings. It looks like cash gross margin is up like 50 basis points or something in March, so that would kind of suggest that loadings are going up just a smidge. Um, and the bigger question is sort of, are you thinking about loadings that you want to keep inventory, sort of in this 4.8 range? And you just want to match loadings with demand from here, or do you want to bring inventory down, you know, over time versus that 4.8 number? Thanks.
Mike Beckman: All right. Tim, thank you so much for the questions. We'll move on to our next caller.
Mike Beckman: All right. Tim, thank you so much for the questions. We'll move on to our next caller.
Yeah, great question on the automotive Market. I think we I think in Q4 we would slightly down but that that was and we did see a strength in uh in the automotive in the second half of this year, right in Q3 and Q4, it's back to the level more or less of the Peaks uh, somewhere in. Uh, in 2023. This is an automotive Peak. Remember, Automotive was last into the cycle, right? Uh, if you go back all the way back to the Coe cycle the the last ones to pick they picked in Q3 at 23 but the the I think what's happening in automotive and it continues to happen is secular C uh uh growth continuing. So generation to generation model to model. We just see more content per video.
Operator: Thank you. Our next question comes from the line of Thomas O'Malley with Barclays. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of Thomas O'Malley with Barclays. Please proceed with your question.
You know, as I've been said earlier, we're very, uh, pleased with inventory levels. Um, that's, uh, good inventory on a number of, uh, fronts, uh, on the buffers that we have, uh, uh, and the position that we have to support potential revenue growth. Uh, the same goes with capacity, we are well positioned with capacity. So we'll adjust those loadings as needed, depending on what we see, uh, for demand for the rest of the year.
All right. Tim, thank you so much for the questions. We'll move on to our next caller.
Vivek Arya: Hey, guys. Thanks for taking my question. Haviv, in your outlook for March, you talked about strength in data center, recovery in industrial continues, and bookings are improving, terms are good.
Thomas O'Malley: Hey, guys. Thanks for taking my question. Haviv, in your outlook for March, you talked about strength in data center, recovery in industrial continues, and bookings are improving, terms are good.
Thank you.
Our next question comes from the line of Thomas Omali with Barclays. Please proceed with your question.
Thomas O'Malley: ... There was no mention of auto there. You guys have said previously, maybe the auto business is a little bit slower off the bottom than industrial. Any update on the auto business and how that trended through the quarter and kind of your updated view there?
... There was no mention of auto there. You guys have said previously, maybe the auto business is a little bit slower off the bottom than industrial. Any update on the auto business and how that trended through the quarter and kind of your updated view there?
Haviv Ilan: Yeah, great question. On the automotive market, I think in Q4, we were slightly down?
Haviv Ilan: Yeah, great question. On the automotive market, I think in Q4, we were slightly down?
Hey guys, thanks for taking my question. Have you in your in your outlook for Mark? You talked about strength and data center recovery and Industrial continues and bookings. Are improving turns are good. Uh, there was no mention of Auto there. You guys have said, previously, maybe the auto business is a little bit, uh, slower off the bottom that industrial uh, any update on the auto business and how that trying to do the quarter and kind of your updated view there.
Mike Beckman: Down, down, low single digits.
Mike Beckman: Down, down, low single digits.
Haviv Ilan: Low single digits. We did see a strength in the automotive in the second half of this year, right? In Q3 and Q4. It's back to the level more or less of the peaks somewhere in 2023. This is an automotive peak. Remember, automotive was last into the cycle, right? If you go back all the way back to the COVID cycle, they are the last ones to peak. They peaked in Q3 2023. But I think what's happening in automotive, and it continues to happen, is secular growth continuing. So generation to generation, model to model, we just see more content per vehicle, even if it's an ICE, a combustion engine vehicle rather than EVs. Strength in China continued in Q4.
Haviv Ilan: Low single digits. We did see a strength in the automotive in the second half of this year, right? In Q3 and Q4. It's back to the level more or less of the peaks somewhere in 2023. This is an automotive peak. Remember, automotive was last into the cycle, right? If you go back all the way back to the COVID cycle, they are the last ones to peak. They peaked in Q3 2023. But I think what's happening in automotive, and it continues to happen, is secular growth continuing. So generation to generation, model to model, we just see more content per vehicle, even if it's an ICE, a combustion engine vehicle rather than EVs. Strength in China continued in Q4.
Vehicle. Even if it's a an ice, um, a combustion engine vehicle rather than a EVS, uh, strength in China continued in Q4 and typically, in q1, if I need to comment about q1 typically, q1 is a is a quarter where, at least in China. We see always, um, which Chinese New Year. We always see a a seasonal seasonally down quarter. I expect that to be the same in q1, but again, we are, we've seen a a single digit, uh, trough versus the picking Automotive back to the same levels. And I think secular growth continues into the, the the foreseeable future, at least for the next 5 years.
Okay. You have a follow-up time.
Yeah, great question, on the automotive Market. I think we I think in Q4 we would slightly down but down, down down, looks and, uh, we did see a strength in, uh, in the automotive in the second half of this year, right? In Q3 and Q4, it's back to the level more or less of the Peaks, uh, somewhere in. Uh, in 2023. This is an automotive piece. Remember, Automotive was last into the cycle, right? Uh, if you go back all the way back to the co cycle,
Haviv Ilan: Typically in Q1, if I need to comment about Q1, typically Q1 is a quarter where, at least in China, we always see with Chinese New Year, we always see a seasonally down quarter. I expect that to be the same in Q1, but again, we've seen a single digit drop versus the peak in automotive back to the same levels, and I think secular growth continues into the foreseeable future, at least for the next five years.
Typically in Q1, if I need to comment about Q1, typically Q1 is a quarter where, at least in China, we always see with Chinese New Year, we always see a seasonally down quarter. I expect that to be the same in Q1, but again, we've seen a single digit drop versus the peak in automotive back to the same levels, and I think secular growth continues into the foreseeable future, at least for the next five years.
Yeah, I just want to clarify our comment earlier you mentioned that pricing didn't have anything to do with the above seasonal, March, and you talked more about these end market trends is that because you've raised pricing previously you plan to in the future. The reason, the question comes from your competitors are talking about an increase in pricing, early in 2026 and being very clear about that. Do you guys feel like, you don't want to do that? Or is it just something you'd rather not comment on, appreciate it. Oh, I I I think we've we've been clear along the year and I just repeat it. And then Mike, you can add a little bit more color, but we said that, we expect the pricing. It looks pricing is the price. We have 80,000 products prices, always go up and down, but for the company, the overall price effect, like for, like, in 25, we expected it to be low single digits down. Now, we finished 25. It was exactly there. When you say low digit, single, you think about 2 or 3% down, uh, that's my assign.
Consumption for 2026. Um, that's what we expect. The market conditions to be uh if anything changes with pricing, if you know, we'll see, uh, you know, of course, the I will will respond, but right now that's our assumption moving forward. That's why I was so, um, uh, convinced that the q1, um,
Mike Beckman: Okay. You have a follow-up, Tom?
Mike Beckman: Okay. You have a follow-up, Tom?
Thomas O'Malley: Yeah, I just wanted to clarify a comment earlier. You mentioned that pricing didn't have anything to do with the above seasonal margin. You talked more about these end market trends. Is that because you've raised pricing previously, you plan to in the future? The reason the question comes from, your competitors are talking about an increase in pricing early in 2026 and being very clear about that. Do you guys feel like you don't wanna do that, or is it just something you'd rather not comment on? Appreciate it.
Thomas O'Malley: Yeah, I just wanted to clarify a comment earlier. You mentioned that pricing didn't have anything to do with the above seasonal margin. You talked more about these end market trends. Is that because you've raised pricing previously, you plan to in the future? The reason the question comes from, your competitors are talking about an increase in pricing early in 2026 and being very clear about that. Do you guys feel like you don't wanna do that, or is it just something you'd rather not comment on? Appreciate it.
5 years. Okay, you have a follow-up, Tom.
Haviv Ilan: No, I think we've been clear along the year, and I'll just repeat it, and then, Mike, you can add a little bit more color. But we said that we expect the pricing. Look, pricing, price, we have 80,000 products. Prices always go up and down. But for the company, the overall price effect, like for like, in 2025, we expected it to be low single digits down. Now, we finished 2025, it was exactly there. When you say low single digit, think about 2 or 3% down. That's my assumption for 2026. That's what we expect the market conditions to be. If anything changes with pricing, you know, we'll see, you know, of course, TI will respond. But right now, that's our assumption moving forward.
Haviv Ilan: No, I think we've been clear along the year, and I'll just repeat it, and then, Mike, you can add a little bit more color. But we said that we expect the pricing. Look, pricing, price, we have 80,000 products. Prices always go up and down. But for the company, the overall price effect, like for like, in 2025, we expected it to be low single digits down. Now, we finished 2025, it was exactly there. When you say low single digit, think about 2 or 3% down. That's my assumption for 2026. That's what we expect the market conditions to be. If anything changes with pricing, you know, we'll see, you know, of course, TI will respond. But right now, that's our assumption moving forward.
Uh, you know, I think we have a little sequential growth. There is not due to pricing, like anything to add there on the pricing side. No, I think you called it out in the base case Assumption of low single digit, uh, decline over time. You know, what, to see what the market presents to us, but continue to expect and definitely, no, no step function planned in q1 actually usually in q1 pricing. Usually goes down a little bit because of yearly negotiations. That usually, what we think, q1, we have a follow up. Oh, that was a follow up. Okay, sorry about that. Thanks. Now for the question about our next caller, okay?
Yeah, I just wanted to clarify a comment. Earlier, you mentioned that pricing didn't have anything to do with the above seasonal—March—and you talked more about these end market trends. Is that because you've raised pricing previously, or you plan to in the future? The reason—the question comes from your competitors are talking about an increase in pricing early in 2026 and being very clear about that. Do you guys feel like you don't want to do that? Or is it just something you'd rather not comment on? Appreciate it. No, I—I think.
Thank you. Our next question, comes from the line of Joshua, uh, uh, Rochester with TD Cowen, please proceed with your question.
Um, I wanted to join a little bit more, any details, you can give us on the exposure or across power embedded and then maybe non non-power analog parts. And and and and, you know, 70% is of growth is a pretty big number any sort of handicapped area, but you're willing to give us on what that business could grow over the medium to long term. Thank you.
Haviv Ilan: That's why I was so convinced that the Q1, you know, I think we have a little sequential growth there, is not due to pricing. Mike, anything to add there on the pricing side?
That's why I was so convinced that the Q1, you know, I think we have a little sequential growth there, is not due to pricing. Mike, anything to add there on the pricing side?
Mike Beckman: No, I think you called it out. In that base case assumption of low single digit decline over time, you know, we'll have to see what the market presents to us, but continue to expect-
Mike Beckman: No, I think you called it out. In that base case assumption of low single digit decline over time, you know, we'll have to see what the market presents to us, but continue to expect-
Clear along the year and I just repeat it and then Mike, you can add a little bit more color, but we said that, we expect the pricing, it looks pricing the price. We have 80,000 products prices, always go up and down, but for the company, the overall price effect, like for, like, in 25, we expected it to be low single digits down. Now, we finished 25. It was exactly there. When you say low digit, single, you think about 2 or 3 percentage, um, that's what we expect. The market conditions to be, uh, if anything changes with pricing, if you know, we'll see, uh, you know, of course, the I will will respond, but right now that's our assumption moving forward. That's why I was so, um, uh, convinced that the q1, um,
Haviv Ilan: Definitely no, no step function planned in Q1. Actually, usually in Q1, pricing usually goes down a little bit because of yearly negotiations. That's usually what we see in Q1. You have a follow-up?
Haviv Ilan: Definitely no, no step function planned in Q1. Actually, usually in Q1, pricing usually goes down a little bit because of yearly negotiations. That's usually what we see in Q1. You have a follow-up?
Yes, definitely. I I can take that. So again data center. Um has grown nicely as you said in in 2020. Uh 5 you know is is capex continues to to to be invested in in data centers. We expect that growth to continue in terms of our position. Uh, most of our business is based on the, on the analog side. Uh, and there is also there is between power and Signal chain. I would say it's kind of, um,
Mike Beckman: That—
Mike Beckman: That—
Haviv Ilan: Oh, that was a follow-up. Okay, sorry about that.
Haviv Ilan: Oh, that was a follow-up. Okay, sorry about that.
Uh, you know, I think we have a little sequential growth. There is not due to pricing. Mike, anything to add there on the pricing side? No, I think you called it out in the base case—assumption of low single digit, uh, decline over time. You know, we'll have to see what the market presents to us, but continue to expect and definitely no, no step function planned in Q1. Uh, actually, usually in Q1, pricing usually goes down.
Mike Beckman: Thanks, Tom, for the question.
Mike Beckman: Thanks, Tom, for the question.
Haviv Ilan: Thank you, Tom.
Haviv Ilan: Thank you, Tom.
Mike Beckman: Move on to our next caller.
Mike Beckman: Move on to our next caller.
A little bit because of, uh, usually negotiations—that's usually what we see in Q1,
Haviv Ilan: Okay.
Haviv Ilan: Okay.
Operator: Thank you. Our next question comes from the line of Joshua Buchalter with TD Cowen. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of Joshua Buchalter with TD Cowen. Please proceed with your question.
You have a follow-up. Oh, that was a follow-up. Okay, sorry about that. Our next caller. Okay.
Joshua Buchalter: Yeah, thank you for taking my question. I wanted to drill into the business a little bit more. Any details you can give us on the exposure across power, embedded, and then maybe non-power analog parts and any, you know, 70% is growth is a pretty big number. Any sort of handicap you're willing to give us on what that business could grow over the medium to long term? Thank you.
Joshua Buchalter: Yeah, thank you for taking my question. I wanted to drill into the business a little bit more. Any details you can give us on the exposure across power, embedded, and then maybe non-power analog parts and any, you know, 70% is growth is a pretty big number. Any sort of handicap you're willing to give us on what that business could grow over the medium to long term? Thank you.
Thank you. Our next question comes from the line of Joshua, uh, uh, reach out to with TD Cowen. Please proceed with your question.
In, in data center, we see a lot of opportunity, a lot of diversity of parts. I know, most people like to talk about, you know, are specific socket. If you call it a vrm or the vcore voltage regulator, that's always a large, a very large socket. But if you look at direct and you open it up, there are thousands of different parts. And many of them are are analog and embedded parts, and TI plays across the board. There, as I mentioned, over the years, we have also invested in our technology, to be able to, uh, support the, the higher power, call it, um, rails, uh, think about the V core.
Haviv Ilan: Yes, definitely. I can take that. So again, Data center has grown nicely, as you said, in 2025. You know, as CapEx continues to be invested in data centers, we expect that growth to continue. In terms of our position, most of our business is based on the Analog side. And there is also between Power and Signal chain, I would say it's kind of maybe a little bit more Power, but both Power and Signal chain are very strong. In Data center, we see a lot of opportunity, a lot of diversity of parts.
Haviv Ilan: Yes, definitely. I can take that. So again, Data center has grown nicely, as you said, in 2025. You know, as CapEx continues to be invested in data centers, we expect that growth to continue. In terms of our position, most of our business is based on the Analog side. And there is also between Power and Signal chain, I would say it's kind of maybe a little bit more Power, but both Power and Signal chain are very strong. In Data center, we see a lot of opportunity, a lot of diversity of parts.
Um, I want to confirm a little bit more any details, you can give us on the exposure or cross power and embedded and maybe non non power, analog parts and and and any, you know, 70% is of growth is a pretty big number, any sort of handicap you're able. But you're willing to give us on what that business could grow over the medium to long term. Thank you.
Uh, this is where a lot of the current going into, uh, um, an accelerator accelerated computer or or CPU come from and, and TI is building the technology in Sherman. Texas. This is where our, um, BCD process is serving us very well there. Uh, that product is sampling and we expect uh our opportunity in data center to further uh, expand
Yes, definitely. I I can take that. So again data center. Um, it's grow nicely as you said in in 2020, uh, 5, uh, you know, it's it's capex continues to to to be invested in in data centers. We expect that growth to continue in terms of our position. Uh, most of our business is based on the on the analog side.
Uh, and the results also, there is between the Power and Signal Chain. I would say it's kind of, um,
Uh, in the coming years. So, TI plans to play, um, across the different sockets in Data Center. And I see it as long as the capex continues into this Market. I see the opportunity, uh, as a an attractive 1.
Haviv Ilan: I know most people like to talk about, you know, a specific socket, if you call it the VRM or the vCore, voltage regulator, that's always a large, a very large socket. But if you look at the rack and you open it up, there are thousands of different parts, and many of them are analog and embedded parts, and TI plays across the border. As I mentioned over the years, we have also invested in our technology to be able to support the higher power, call it, rails. Think about the vCore. This is where a lot of the current going into an accelerator, accelerated computer or a CPU comes from. And TI is building the technology in Sherman, Texas.
I know most people like to talk about, you know, a specific socket, if you call it the VRM or the vCore, voltage regulator, that's always a large, a very large socket. But if you look at the rack and you open it up, there are thousands of different parts, and many of them are analog and embedded parts, and TI plays across the border. As I mentioned over the years, we have also invested in our technology to be able to support the higher power, call it, rails. Think about the vCore. This is where a lot of the current going into an accelerator, accelerated computer or a CPU comes from. And TI is building the technology in Sherman, Texas.
All right. You have a follow-up, Josh.
Yes, thank you for calling the calling several years for the analog industry for a while. He talked about the management of your US base capacity. Um, you feel like we're having, you know, like the industry and your guys from a technical standpoint of being from a line. You know, there's been a lot of us on inventory, but we hit the point where expect, you know. Yeah, I can get back into it, the shares. Um, being normal enough yet. Thank you.
Haviv Ilan: This is where our BCD process is serving us very well there. That product is sampling, and we expect our opportunity in data center to further expand in the coming years. So TI plans to play across the different sockets in data center, and I see it, as long as CapEx continues into this market, as an attractive one.
This is where our BCD process is serving us very well there. That product is sampling, and we expect our opportunity in data center to further expand in the coming years. So TI plans to play across the different sockets in data center, and I see it, as long as CapEx continues into this market, as an attractive one.
Maybe a little bit more power, but both power and Signal chain are very strong. Uh, in in data center, we see a lot of opportunity, a lot of diversity of parts. I know, most people like to talk about, you know, are specific socket. If you call it a vrm or the vcore voltage regulator, that's always a large, a very large socket. But if you look at direct and you open it up, there are thousands of different parts. And many of them are are analog and embedded parts, and the I place the board there. As I mentioned over the years, we have also invested in our technology, to be able to support the the higher power, call it, um, rails. Uh, think about the V core. Uh, this is where a lot of the current going into, uh, um, an accelerator accelerated computer or or CPU come from and, and TI is building the technology in Sherman, Texas. This is where our, um, BCD process is serving us
So, so Josh, I think there was a little trouble on the line, but I'm going to repeat what I believe the question was and then we'll answer it. So, I think it was talking about the cycle and how it's been playing out. Um, and, uh, with the capacity that we have in place, are we in a position to be able to get back to, uh, market, share gains? And, and if you want to start with an answer, I can also answer as well. Was that a question? Uh, I believe that was Josh.
Mike Beckman: All right. You have a follow-up, Josh?
Mike Beckman: All right. You have a follow-up, Josh?
Joshua Buchalter: Yeah, thank you for all the color there. And, you know, big picture, well, an interesting several years for the analog industry. And for a while, you've talked about the benefits of your US-based, you know, military capacity. Do you feel like we're at a point in, like, the industry and your guys, from a cyclical standpoint, being from wide, you know, there's been a lot of noise on inventory, but are we at the point where you expect, you know, TI can get back into sort of the shared leadership? Everything normal enough yet? Thank you.
Joshua Buchalter: Yeah, thank you for all the color there. And, you know, big picture, well, an interesting several years for the analog industry. And for a while, you've talked about the benefits of your US-based, you know, military capacity. Do you feel like we're at a point in, like, the industry and your guys, from a cyclical standpoint, being from wide, you know, there's been a lot of noise on inventory, but are we at the point where you expect, you know, TI can get back into sort of the shared leadership? Everything normal enough yet? Thank you.
Very well there. Uh, that product is sampling. And we expect, uh, our opportunity in data center to further, uh, expand, uh, in the coming years. So, TI plans to play, um, across the different sockets in data center. And I see it as long as the capex continues into this market, uh, I see the opportunity, uh, as an attractive one.
All right. You have a follow-up, Josh.
Thanks so much. Okay. Yeah, as as we said look uh the cycle this this week cycle is recovered slowly. You know, we've just uh forget about TI just look at the overall unit strand. You can look at the units without memory. You can look at the IC is it's been 1 of the slowest, if not the slowest recovery ever in our history at the time where I think more semis, I'll use the in our life. Um,
I mentioned the secular growth in in, in automotive, we see that across many, many end equipments in industrial across the board just more more, um, content persistent.
Mike Beckman: ... So, Josh, I think there was a little trouble on the line, but I'm going to repeat what I believe the question was, and then we'll answer it. So I think it was talking about the cycle and how it's been playing out, and with the capacity that we have in place, are we in a position to be able to get back to market share gains? And if you want to start with the answer, I can also answer as well.
Mike Beckman: ... So, Josh, I think there was a little trouble on the line, but I'm going to repeat what I believe the question was, and then we'll answer it. So I think it was talking about the cycle and how it's been playing out, and with the capacity that we have in place, are we in a position to be able to get back to market share gains? And if you want to start with the answer, I can also answer as well.
Yes, thank you for calling. There will be an interesting several years for the analogy mystery, and for a while, you've talked about the management of your U.S. space in 300 million creative capacity. Um, you feel like we're having industry in you guys from a technical standpoint, being from a line. You know, it's been a lot of us on inventory, but are we at the point where we expect—you know—yeah, I can get back into it, the share manager. Um, I think, is normal enough yet? Thank you.
Uh, that just that and of course the investment in data center that are becoming more and more substantial, even for um the analog and embedded portfolio that we have. So I do believe that um, there is going to be a point of time where you all these capacity, we put in place and the inventory that we position is going to serve as well. We have seen cases where it served us very well with an immediate response.
Haviv Ilan: Was that the question, Josh?
Haviv Ilan: Was that the question, Josh?
Mike Beckman: Yep, of course. Thanks, Mike.
Joshua Buchalter: Yep, of course. Thanks, Mike.
Haviv Ilan: Okay. Yeah, as we said, look, the cycle, this cycle has recovered slowly. You know, we just forget about TI, just look at the overall unit trend. You can look at the units without memory, you can look at ICs. It's been one of the slowest, if not the slowest, recovery ever in our history, at a time where I think more semis are used in our life. I mentioned the secular growth in automotive. We see that across many, many end equipments, in industrial, across the board, just more, more content per system. That just, and of course, the investments in data center that are becoming more and more substantial, even for the analog and embedded portfolio that we have.
Haviv Ilan: Okay. Yeah, as we said, look, the cycle, this cycle has recovered slowly. You know, we just forget about TI, just look at the overall unit trend. You can look at the units without memory, you can look at ICs. It's been one of the slowest, if not the slowest, recovery ever in our history, at a time where I think more semis are used in our life. I mentioned the secular growth in automotive. We see that across many, many end equipments, in industrial, across the board, just more, more content per system. That just, and of course, the investments in data center that are becoming more and more substantial, even for the analog and embedded portfolio that we have.
Getting back to, uh, market share gains—and if you want to start with an answer, I can also answer as well. Was that a question? I believe that was.
Uh, to customer needs, and our customers value that a lot. And I believe, uh, there is, um, more to do here. So, uh, let's see how the market wants to continue in develop. I, 1 thing is is very clear to me.
uh,
And equipments are being redesigned with more semis every day, the it will continue to be the case in the future. This is why I'm continuing to I'm continuing to stay very um optimistic and uh encouraged
Uh, by the investment we've made in the past several years.
All right. Thanks. Josh uh, move on to our next caller. Please.
Okay. Yeah, as we said, look, the cycle—this cycle is recovering slowly. You know, if we just forget about TI, just look at the overall units trend. You can look at the units without memory, you can look at the ICs—it’s been one of the slowest, if not the slowest, recoveries ever in our history, at a time where I think more semis are used in our life.
Thank you.
Our next question comes from the line of William Stein with truest, please proceed with your question.
I mentioned the secular growth in, in automotive; we see that across many, many end equipments. In industrial, across the board, just more and more content per system.
Haviv Ilan: So I do believe that there is gonna be a point of time where all this capacity we've put in place and the inventory that we've positioned is gonna serve us well. We have seen cases where it served us very well with an immediate response to customer needs, and our customers value that a lot, and I believe there is more to do here. So let's see how the market wants to continue and develop. One thing is very clear to me: end equipments are being redesigned with more semis every day. It will continue to be the case in the future. This is why I'm continuing to stay very optimistic and encouraged by the investment we've made in the past several years.
So I do believe that there is gonna be a point of time where all this capacity we've put in place and the inventory that we've positioned is gonna serve us well. We have seen cases where it served us very well with an immediate response to customer needs, and our customers value that a lot, and I believe there is more to do here. So let's see how the market wants to continue and develop. One thing is very clear to me: end equipments are being redesigned with more semis every day. It will continue to be the case in the future. This is why I'm continuing to stay very optimistic and encouraged by the investment we've made in the past several years.
Great. Thank you for taking my questions. Um, first, I'm hoping you can talk a little bit more about the strong bookings. You referred to. Um, would you be, uh, able to disclose, uh, the book to build us?
And um maybe even more interesting. Has the duration of your backlog changed at all in the quarter?
Uh, just that. And of course, the investment in data centers that are becoming more and more substantial, even for, um, the analog and embedded portfolio that we have. So, I do believe that, um, there is going to be a point in time where all this capacity we’ve put in place, and the inventory that we’ve positioned, is going to serve us well. We have seen cases where it served us very well, with an immediate response.
So, uh, maybe I'll I'll take that 1. Uh, so will we did see throughout the quarter, you know, backlog did build. And, and I think the first of all, it's important to remember that a we transact, most of our Revenue truck with our customers, meaning that we don't sell through a channel. So, we do see things typically pretty real time. And
Uh, to customer needs, and our customers value that a lot. And I believe, uh, there is, um, more to do here. So, uh, let's see how the market wants to continue and develop. I—one thing is very clear to me.
uh,
Bank of the last several quarters, you know? I I don't have a number specifically to provide you for what bookings did but it is reflected in our our guidance. And I think, you know, going back to what haviv said about where our end markets are. You know, industrial is is
Mike Beckman: All right. Thanks, Josh. Move on to our next caller, please.
Mike Beckman: All right. Thanks, Josh. Move on to our next caller, please.
And equipments are being redesigned with more semis every day. It will continue to be the case in the future. This is why I'm continuing to, I'm continuing to stay very, um, optimistic and, uh, encouraged.
Operator: Thank you. Our next question comes from the line of William Stein with Truist. Please proceed with your question.
Operator: Thank you. Our next question comes from the line of William Stein with Truist. Please proceed with your question.
Uh, by the investment we've made in the past several years.
You know, going through recovery and we saw that in fourth quarter, you got Data Center and Market that is growing for I think 7 consecutive quarters. Um you know those are all part of what factor into how we think about our guidance.
All right. Thanks. Josh, uh, move on to our next caller, please.
You have a follow-up will
William Stein: Great. Thank you for taking my questions. First, I'm hoping you can talk a little bit more about the strong bookings you referred to. Would you be able to disclose the book to bill to us? And, maybe even more interesting, has the duration of your backlog changed at all in the quarter?
William Stein: Great. Thank you for taking my questions. First, I'm hoping you can talk a little bit more about the strong bookings you referred to. Would you be able to disclose the book to bill to us? And, maybe even more interesting, has the duration of your backlog changed at all in the quarter?
Yeah, I mean, I'll ask maybe the same question a little bit of a different way. Are you seeing, um,
Thank you. Our next question will come from the line of William Stein with Truist. Please proceed with your question.
Either based on customer willingness to place the orders or because of your own lead times to customers. Have you seen an extension in the orders further out into the future?
Great. Thank you for taking my questions. Um, first, I'm hoping you can talk a little bit more about the strong bookings you referred to. Um, would you be able to disclose the book-to-bill for us?
Mike Beckman: So, maybe I'll, I'll take that one.
Mike Beckman: So, maybe I'll, I'll take that one.
The short answer is yes, but again not be.
Haviv Ilan: Yeah.
Haviv Ilan: Yeah.
Mike Beckman: So Will, we did see throughout the quarter, you know, backlog did build, and I think, first of all, it's important to remember that we transact most of our revenue direct with our customers, meaning that we don't sell through a channel. So we do see things typically pretty real time, and that's part of the reason you heard us talk about the fact that we have seen our turns business also exhibit strength over the last several quarters. You know, I don't have a number specifically to provide you for what bookings did, but it is reflected in our guidance. And I think, you know, going back to what Haviv said about where our end markets are, you know, industrial is going through recovery, and we saw that in Q4.
Mike Beckman: So Will, we did see throughout the quarter, you know, backlog did build, and I think, first of all, it's important to remember that we transact most of our revenue direct with our customers, meaning that we don't sell through a channel. So we do see things typically pretty real time, and that's part of the reason you heard us talk about the fact that we have seen our turns business also exhibit strength over the last several quarters. You know, I don't have a number specifically to provide you for what bookings did, but it is reflected in our guidance. And I think, you know, going back to what Haviv said about where our end markets are, you know, industrial is going through recovery, and we saw that in Q4.
And, um, maybe even more interesting—has the duration of your backlog changed at all in the quarter?
Times Early times are are very competitive and changed. Uh, I think whenever it's below 13 weeks, uh, many of our parts are 6 weeks part of our, ambition, and objective, as we prepare to the next cycle,
Uh, was to be, to be able to maintain very competitive lead times across the cycle. So far this cycle is not being, is not being very, um,
So, uh, maybe I'll, I'll take that one. Uh, so, we did see throughout the quarter, you know, backlog did build. And, and I think, first, well, it's important to remember that we transact most of our revenue direct with our customers, meaning that we don't sell through a channel. So, we do see things typically pretty real-time. And that's part of the reason you heard us talk about the fact that we have seen our turns business.
Mike Beckman: You've got data center end market that is growing for, I think, seven consecutive quarters. You know, those are all part of what factor into how we think about our guidance. You have a follow-up, Will?
You've got data center end market that is growing for, I think, seven consecutive quarters. You know, those are all part of what factor into how we think about our guidance. You have a follow-up, Will?
Talk to to me right, as I said it's been a slow recovery but uh hourly times continue to stay. Um um very very competitive. Probably the lowest in the industry in our inventory position allows us to support customers. So I don't think customers are placing. I mean they are placing orders a little bit more forward but they have the ability to change their their, their opinion. Um, even within this quarter, this is what Mike mentioned before.
William Stein: Yeah, I mean, I'll ask maybe the same question a little bit of a different way. Are you seeing either based on customer willingness to place the orders or because of your own lead times to customers, have you seen an extension in the orders further out into the future?
William Stein: Yeah, I mean, I'll ask maybe the same question a little bit of a different way. Are you seeing either based on customer willingness to place the orders or because of your own lead times to customers, have you seen an extension in the orders further out into the future?
Also exhibit strength of the last several quarters, you know, I I don't have a number specifically to provide you for what bookings did but it is reflected in our our guidance and I think you know, going back to what haviv said about where our end markets are. You know, industrial is is uh you know going through recovery and we saw that in fourth quarter you got Data Center and Market that is uh growing for I think 7 consecutive quarters. Um you know those are all part of what factor into how we think about our guidance.
You have a follow-up will
Yeah, I mean, I'll ask maybe the same question a little bit of a different way. Are you seeing, um,
Uh, our terms of are very friendly or very customer friendly. We want customers, uh, to be, uh, you know, showing us their demand real time and we are willing to, um, to uh, carry this inventory especially when it's so diverse and long lived to increase, um, customer support.
Haviv Ilan: The short answer is yes, but again, not because of lead times. Our lead times are very competitive, unchanged, I think on average, below 13 weeks. Many of our parts are 6 weeks. Part of our ambition and objective, as we prepare to the next cycle, was to be able to maintain very competitive lead times across the cycle. So far, this cycle has not been very tough to meet, right? As I said, been a slow recovery, but our lead times continue to stay very competitive, probably the lowest in the industry, and our inventory position allows us to support customers.
Haviv Ilan: The short answer is yes, but again, not because of lead times. Our lead times are very competitive, unchanged, I think on average, below 13 weeks. Many of our parts are 6 weeks. Part of our ambition and objective, as we prepare to the next cycle, was to be able to maintain very competitive lead times across the cycle. So far, this cycle has not been very tough to meet, right? As I said, been a slow recovery, but our lead times continue to stay very competitive, probably the lowest in the industry, and our inventory position allows us to support customers.
Either based on customer willingness to place the orders, or because of your own lead times to customers, have you seen an extension in the orders further out into the future?
Be prepared for the next cycle.
Uh, so that would be my high level, comment. Mike anything else about, uh, what we see in to the longevity of the inventory. Uh, well, the inventory that we have in place, has incredible longevity? No, no. But on the, on the orders that it was asked, yeah, I'd say that if you look at, does a customer need to put long-term backlog out in place, when the lead times are stable, they probably don't feel like they have to necessarily so I have nothing to spike out that I would say but we have seen is a lot of uh customers wanting to come in and want product quickly. That has been something we've seen build over the past, couple quarters.
Uh, was to be, to be able to maintain very competitive lead times across the cycle. So far, this cycle has not been—has not been very, um,
All right with that. We'll move on to our next caller. Our last 1.
Haviv Ilan: So I don't think customers are placing. I mean, they are placing orders a little bit more forward, but they have the ability to change their their opinion, even within this quarter. This is what Mike mentioned before. Our terms are very friendly, very customer friendly. We want customers to be, you know, showing us their demand real time, and we are willing to carry this inventory, especially when it's so diverse and long-lived, to increase customer support. So that would be my high-level comment. Mike, anything else about what we see into the longevity of the inventory?
So I don't think customers are placing. I mean, they are placing orders a little bit more forward, but they have the ability to change their their opinion, even within this quarter. This is what Mike mentioned before. Our terms are very friendly, very customer friendly. We want customers to be, you know, showing us their demand real time, and we are willing to carry this inventory, especially when it's so diverse and long-lived, to increase customer support. So that would be my high-level comment. Mike, anything else about what we see into the longevity of the inventory?
Our last question comes from the line of Chris Kesler, with wolf research, please proceed with your question.
Tough to to meet right? It's as I said it's been a slow recovery. But uh, hourly times continue to stay. Um, um, very, very competitive. While the lowest in the industry in the inventory position allows us to support customers. So I don't think customers are placing. I mean, they are placing orders a little bit more forward but they have the ability to change their their, their opinion. Um, even within this quarter, this is what Mike mentioned before.
Uh, yes, thanks. Uh, good evening. I guess the first question is a clarification of some what you said about Factory loadings and and you did say that you had just loadings according to uh, you know, what you saw with demand and and and taken into consideration that you reduced. Those loadings more recently, you know, is are there any plans in place now to increase those loading? And you know, what would you need to see in order to to to take those steps?
Our terms are very friendly, or very customer friendly. We want customers, uh, to be, uh, you know, showing us their demand real time. And we, we are willing to, um, to, uh, carry this inventory, especially when it's so diverse and long-lived, to increase, um, customer support.
Mike Beckman: Well, the inventory we have in place has incredible longevity.
Mike Beckman: Well, the inventory we have in place has incredible longevity.
Haviv Ilan: No, no, but on the orders that it was asked.
Haviv Ilan: No, no, but on the orders that it was asked.
Mike Beckman: Yeah, I'd, I'd say that if you look at the. Does a customer need to put long-term backlog out in place when lead times are stable? They probably don't feel like they have to necessarily, so nothing to spike out, that I would say. But what we have seen is a lot of, customers wanting to come in, want product quickly. That has been something we've seen build over the past several quarters. All right. With that, we'll move on to our next caller. Our last caller.
Mike Beckman: Yeah, I'd, I'd say that if you look at the. Does a customer need to put long-term backlog out in place when lead times are stable? They probably don't feel like they have to necessarily, so nothing to spike out, that I would say. But what we have seen is a lot of, customers wanting to come in, want product quickly. That has been something we've seen build over the past several quarters. All right. With that, we'll move on to our next caller. Our last caller.
What I would tell you is that if we had something significant uh, changing like we did back in third quarter, we would, we would tell you uh we are not uh making any disclosure right now on on which way the load is going. So it's just, uh, it's nothing significant versus where we've been running in, uh, in fourth quarter.
And I just added part of that is, you know, we have the ability to make those adjustments as we see things occur. And that's part of the flexibility, we have in our, our manufacturing to be able to do that. All right, Chris, you have a follow-up.
Haviv Ilan: Our last one. Yeah.
Haviv Ilan: Our last one. Yeah.
Operator: Thank you. Our last question comes from the line of Chris Caso with Wolfe Research. Please proceed with your question.
Operator: Thank you. Our last question comes from the line of Chris Caso with Wolfe Research. Please proceed with your question.
Uh, so that would be my high-level comment. Mike, anything else about, uh, what we see into the longevity of the inventory? Oh, well, the inventory that we have in place has incredible longevity. No, no. But on the orders that it was asked, yeah, I'd say that if you look at, does a customer need to put long-term backlog out in place when the lead times are stable, they probably don't feel like they have to necessarily, so nothing to spike out that I would say. But what we have seen is a lot of, uh, customers wanting to come in and want product quickly. That has been something we've seen build over the past couple quarters.
All right, with that, we'll move on to our next caller—our last one.
Chris Caso: Yes. Thanks. Good evening. I guess the first question is a clarification of something you said about factory loadings. And you did say that you'd adjust loadings according to, you know, what you saw with demand. And taking into consideration that you reduced those loadings more recently, you know, are there any plans in place now to increase those loadings? And you know, what would you need to see in order to take those steps?
Chris Caso: Yes. Thanks. Good evening. I guess the first question is a clarification of something you said about factory loadings. And you did say that you'd adjust loadings according to, you know, what you saw with demand. And taking into consideration that you reduced those loadings more recently, you know, are there any plans in place now to increase those loadings? And you know, what would you need to see in order to take those steps?
I do and it's related to to uh Geographic Revenue. You made some comments on China. Obviously, you have the the New Year holiday that hits in the first quarter but, you know, if if we look at the different regions, how does that stack up against what you would expect for for normal seasonality, each 1 of those regions in the first quarter?
Our last question comes from the line of Chris Casar with Wolfe Research. Please proceed with your question.
Yeah, in general, I think we haven't seen anything specific on. Um,
Rafael Lizardi: ... What I would tell you is that, if we had something significant changing like we did back in Q3, we would tell you. We are not making any disclosure right now on which way the loadings are going. So it's just nothing significant versus where we've been running in Q4.
Rafael Lizardi: ... What I would tell you is that, if we had something significant changing like we did back in Q3, we would tell you. We are not making any disclosure right now on which way the loadings are going. So it's just nothing significant versus where we've been running in Q4.
Uh yes, thanks. Uh, good evening. I guess the first question is a clarification of some what you said about Factory loadings and and you did say that you'd have just loadings according to uh you know, what you saw with demand and and and taken into consideration that you reduce those loading more recently, you know, is are there any plans in place now to increase those loadings? And you know, what would you need to see in order to to to take those steps?
Mike Beckman: I'll just add, that part of that is, you know, we have the ability to make those adjustments as we see things occur, and that's part of the flexibility we have in our, our manufacturing to be able to do that. All right, Chris, you have a follow-up?
Mike Beckman: I'll just add, that part of that is, you know, we have the ability to make those adjustments as we see things occur, and that's part of the flexibility we have in our, our manufacturing to be able to do that. All right, Chris, you have a follow-up?
But I would tell you that uh if we had something significant uh changing like we did back in third quarter, we would we would tell you uh we are not making any disclosure right now on on which way the load is are going. So it's just uh, it's nothing significant versus where we've been running in uh, in fourth quarter.
Chris Caso: I do, and it's related to the geographic revenue. You made some comments on China. Obviously, you have the New Year holiday that hits in the first quarter. But, you know, if we look at the different regions, how does that stack up against what you would expect for normal seasonality in each one of those regions in the first quarter?
Chris Caso: I do, and it's related to the geographic revenue. You made some comments on China. Obviously, you have the New Year holiday that hits in the first quarter. But, you know, if we look at the different regions, how does that stack up against what you would expect for normal seasonality in each one of those regions in the first quarter?
And I just added, part of that is, you know, we have the ability to make those adjustments as we see things occur. And that's part of the flexibility we have in our manufacturing to be able to do that.
All right, Chris, you have a follow-up.
Haviv Ilan: Yeah, in general, I think we haven't seen anything specific on. The only comment I've made, Chris, before, was that typically Q1 in China for automotive is lower, just because of Chinese New Year. But I think from where the backlog comes through from, it's been pretty even, right, across-
Haviv Ilan: Yeah, in general, I think we haven't seen anything specific on. The only comment I've made, Chris, before, was that typically Q1 in China for automotive is lower, just because of Chinese New Year. But I think from where the backlog comes through from, it's been pretty even, right, across-
I I do and it's related to to uh, Geographic Revenue. You made some comments on China. Obviously, you have the the New Year holiday that hits in the first quarter but, you know, if if we look at the different regions, how does that stack up against what you would expect for for normal seasonality, each 1 of those regions in the first quarter?
Yeah, in general, I think we haven't seen anything specific on, um,
Mike Beckman: Yeah
Mike Beckman: Yeah
Haviv Ilan: - The geographies, Mike?
Haviv Ilan: - The geographies, Mike?
Mike Beckman: Then maybe I'll just talk about last quarter, what we saw, and, you know, we don't have a guidance by regions for the top level. But, you know, China came in, you know, right about, on a sequential basis, pretty much in line with what we saw at the top level, down about 7%. On a year-on-year for Q4, it was up about 16%. So, you know, didn't see something on a sequential basis that stood out very differently there compared to the overall top-level results.
Mike Beckman: Then maybe I'll just talk about last quarter, what we saw, and, you know, we don't have a guidance by regions for the top level. But, you know, China came in, you know, right about, on a sequential basis, pretty much in line with what we saw at the top level, down about 7%. On a year-on-year for Q4, it was up about 16%. So, you know, didn't see something on a sequential basis that stood out very differently there compared to the overall top-level results.
Finished the, the call, I want to make 1 more comment on the, on the orders and everything. I just want to remind us all that TI is, is invested in capacity and in inventory, over the last 3 or 4 years to be exactly ready for this type of environment, right. We've seen a lot of real-time demand coming in in Q4 with which we were able to support. We're seeing a little bit of strengthening in the in the orders right now in q1 and we'll see how long lived it will be. You know the market has been uh jittery in the last uh 12 years, 12 months, sorry. And we'll just have to see how it plays out. This is also related to Rafael's, comment about loading, we have the knobs to turn as needed and we have the inventory to allow us time to adjust. Uh, our our, our loading, for example, as we go, so we are in a very good position.
Uh, as we, uh, come into the 2026. Uh, we worked very hard to get to you and I'm very proud of our execution and, uh, we'll be ready for any scenario that the market wants to present to us.
Haviv Ilan: And I wanna make, maybe before we let Mike finish the call, I wanna make one more comment on the orders and everything. I just want to remind us all that TI has invested in capacity and in inventory over the last 3 or 4 years to be exactly ready for this type of environment, right? We've seen a lot of real-time demand coming in in Q4, with which we were able to support. We're seeing a little bit of strengthening in the orders right now in Q1, and we'll see how long-lived it will be. You know, the market has been jittery in the last 12 months, sorry, and we'll just have to see how it plays out. This is also related to Rafael's comment about loading.
Haviv Ilan: And I wanna make, maybe before we let Mike finish the call, I wanna make one more comment on the orders and everything. I just want to remind us all that TI has invested in capacity and in inventory over the last 3 or 4 years to be exactly ready for this type of environment, right? We've seen a lot of real-time demand coming in in Q4, with which we were able to support. We're seeing a little bit of strengthening in the orders right now in Q1, and we'll see how long-lived it will be. You know, the market has been jittery in the last 12 months, sorry, and we'll just have to see how it plays out. This is also related to Rafael's comment about loading.
Alert anyone to you Mike. Yeah, thank you. And thank you all of you for joining us today. Um, again, as we mentioned earlier, we look forward to sharing with your Capital Management call on Tuesday, February 24th, at 10:00 a.m. Central Time.
Uh, a replay of this call will be available shortly on our website and with that have a great evening.
Thank you. And this concludes today's conference and you may disconnect your line at this time. Thank you for your participation.
the only comment I've made Chris before was that typically q1 in China for automotive lower just because of Chinese New Year. But I think from um with the below comfort from it's been pretty even right across the geographies Mike and and then maybe I'll just talk about last quarter what we saw. And and you know if we don't have a guidance by by by regions for the top level. But um, you know, China came in, you know, write about in on a sequential basis. Pretty much in line with what we saw at the top level of doubt about 7%, um, on a year-on-year for fourth quarter was up about 16%. So, um, you know, didn't see something on a sequential basis that stood out very differently there compared to the overall top level results. And I want to make a maybe before we, uh, let Mike, uh, finish the the call. I want to make 1 more comment on the, on the orders and everything. I just want to remind us all that TI, um, is, is invested in capacity and in inventory, over the last 3 or 4 years to be exactly ready for this type of environment, right? We
Haviv Ilan: We have the knobs to turn, as needed, and we have the inventory to allow us time to adjust our loading, for example, as we go. So we are in a very good position as we come into 2026. We worked very hard to get here, and I'm very proud of our execution, and we'll be ready for any scenario that the market wants to present to us. Anything to you, Mike?
We have the knobs to turn, as needed, and we have the inventory to allow us time to adjust our loading, for example, as we go. So we are in a very good position as we come into 2026. We worked very hard to get here, and I'm very proud of our execution, and we'll be ready for any scenario that the market wants to present to us. Anything to you, Mike?
We've seen a lot of real-time demand coming in in Q4 which we were able to support. We're seeing a little bit of strengthening in the in the orders right now in q1 and we'll see how long lived it will be you know the market has been a jittery in the last uh 12 years, 12 months, sorry. And we'll just have to see how it plays out. This is also related to Rafael's, comment about loading, we have the knobs to turn as needed and we have the inventory to allow us time to adjust. Uh, our our, our loading, for example, as we go, so we are in a very good position.
Mike Beckman: Yeah. Thank you, Haviv, and thank you, all of you, for joining us today. Again, as we mentioned earlier, we look forward to sharing with you our capital management call on Tuesday, 24 February at 10:00AM Central Time. A replay of this call will be available shortly on our website. With that, have a great evening.
Mike Beckman: Yeah. Thank you, Haviv, and thank you, all of you, for joining us today. Again, as we mentioned earlier, we look forward to sharing with you our capital management call on Tuesday, 24 February at 10:00AM Central Time. A replay of this call will be available shortly on our website. With that, have a great evening.
Yeah, thank you. And thank you, all of you, for joining us today. Um, again, as we mentioned earlier, we look forward to sharing with you our Capital Management call on Tuesday, February 24th, at 10 a.m. Central Time.
Operator: Thank you. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.
Operator: Thank you. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.
A replay of this call will be available shortly on our website, and with that, have a great evening.
Thank you. And this concludes today's conference, and you may disconnect your line at this time. Thank you for your participation.