Conference call at 3:30 p.m. Central time today on ti.com/ir
DALLAS, Oct. 21, 2026 /PRNewswire/ -- Texas Instruments Incorporated (TI) (Nasdaq: TXN) today reported third quarter revenue of $6.06 billion, net income of $2.43 billion and earnings per share of $2.62. Earnings per share included a 1-cent reduction that was not in the company's original guidance.
Regarding the company's performance and returns to shareholders, Haviv Ilan, TI's chairman, president and CEO, made the following comments:
- "Revenue increased 11% sequentially and 28% from the same quarter a year ago with continued broad growth in industrial, automotive and data center.
- "Our cash flow from operations of $9.9 billion for the trailing 12 months again underscored the strength of our business model, the quality of our product portfolio and the benefit of 300mm production. Free cash flow for the same period was $8.4 billion.
- "Over the past 12 months we invested $4.0 billion in R&D and SG&A, invested $2.6 billion in capital expenditures and returned $5.8 billion to owners.
- "TI's fourth quarter outlook is for revenue in the range of $5.80 billion to $6.30 billion and earnings per share between $2.45 and $2.79."
Free cash flow, a non-GAAP financial measure, is cash flow from operations less capital expenditures, plus proceeds from U.S. CHIPS and Science Act (CHIPS Act) incentives.
Earnings summary
(In millions, except per-share amounts) Q3 2026 Q3 2025 Change
Revenue $
6,055 $
4,742 28 %
Operating profit $
2,874 $
1,663 73 %
Net income $
2,425 $
1,364 78 %
Earnings per share $
2.62 $
1.48 77 %
Cash generation
Trailing 12 Months
(In millions) Q3 2026 Q3 2026 Q3 2025 Change
Cash flow from operations $
3,419 $
9,896 $
6,897 43 %
Free cash flow $
2,956 $
8,422 $
2,415 249 %
Free cash flow % of
revenue 40.6 % 14.0 %
Cash return
Trailing 12 Months
(In millions) Q3 2026 Q3 2026 Q3 2025 Change
Dividends paid $
1,298 $
5,174 $
4,949 5 %
Stock
repurchases $
48 $
636 $
1,611 (61) %
Total cash
returned $
1,346 $
5,810 $
6,560 (11) %
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated Statements of Income For Three Months Ended
September 30,
(In millions, except per-share amounts) 2026 2025
Revenue $
6,055 $
4,742
Cost of revenue (COR) 2,168 2,019
Gross profit 3,887 2,723
Research and development (R&D) 530 518
Selling, general and administrative (SG&A) 476 457
Acquisition charges 7
Restructuring charges/other 85
Operating profit 2,874 1,663
Other income (expense), net (OI&E) 72 62
Interest and debt expense 141 141
Income before income taxes 2,805 1,584
Provision for income taxes 380 220
Net income $
2,425 $
1,364
Diluted earnings per common share $
2.62 $
1.48
Average shares outstanding:
Basic 914 909
Diluted 921 914
Cash dividends declared per common share $
1.42 $
1.36
Supplemental Information
(Quarterly, except as noted)
Provision for income taxes is based on the following:
Operating taxes (calculated using the estimated annual effective tax rate) $
390 $
249
Discrete tax items (10) (29)
Provision for income taxes (effective taxes) $
380 $
220
A portion of net income is allocated to unvested restricted stock units (RSUs) on which we pay dividend equivalents. Diluted
EPS is calculated using the following:
Net income $
2,425 $
1,364
Income allocated to RSUs (14) (8)
Income allocated to common stock for diluted EPS $
2,411 $
1,356
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated Balance Sheets September 30,
(In millions, except par value) 2026 2025
Assets
Current assets:
Cash and cash equivalents $
4,211 $
3,311
Short-term investments 3,931 1,875
Accounts receivable, net of allowances of ($27) and ($21) 2,620 2,062
Raw materials 497 431
Work in process 2,482 2,460
Finished goods 1,693 1,938
Inventories 4,672 4,829
Prepaid expenses and other current assets 1,446 1,799
Total current assets 16,880 13,876
Property, plant and equipment at cost 18,072 17,314
Accumulated depreciation (6,239) (4,966)
Property, plant and equipment 11,833 12,348
Goodwill 4,330 4,362
Deferred tax assets 1,054 1,089
Capitalized software licenses 301 237
Overfunded retirement plans 320 251
Other long-term assets 2,121 2,841
Total assets $
36,839 $
35,004
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt $
650 $
500
Accounts payable 837 779
Accrued compensation 675 724
Income taxes payable 60 79
Accrued expenses and other liabilities 795 1,036
Total current liabilities 3,017 3,118
Long-term debt 12,905 13,546
Underfunded retirement plans 118 125
Deferred tax liabilities 62 60
Other long-term liabilities 1,552 1,528
Total liabilities 17,654 18,377
Stockholders' equity:
Preferred stock, $25 par value. Shares authorized - 10; none issued
Common stock, $1 par value. Shares authorized - 2,400; shares issued - 1,741 1,741 1,741
Paid-in capital 5,202 4,410
Retained earnings 54,282 52,369
Treasury common stock at cost
Shares: September 30, 2026 - 827; September 30, 2025 - 832 (41,955) (41,744)
Accumulated other comprehensive income (loss), net of taxes (AOCI) (85) (149)
Total stockholders' equity 19,185 16,627
Total liabilities and stockholders' equity $
36,839 $
35,004
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
Consolidated Statements of Cash Flows For Three Months Ended
September 30,
(In millions) 2026 2025
Cash flows from operating activities
Net income $
2,425 $
1,364
Adjustments to net income:
Depreciation 555 497
Amortization of capitalized software 21 20
Stock compensation 95 93
Deferred taxes (26) 3
Increase (decrease) from changes in:
Accounts receivable (100) (128)
Inventories (67) (17)
Prepaid expenses and other current assets 16 18
Accounts payable and accrued expenses 75 86
Accrued compensation 135 121
Income taxes payable 319 107
Changes in funded status of retirement plans (6) 13
Other (23) 13
Cash flows from operating activities 3,419 2,190
Cash flows from investing activities
Capital expenditures (463) (1,197)
Proceeds from CHIPS Act incentives 75
Proceeds from asset sales 1
Purchases of short-term investments (1,969) (805)
Proceeds from short-term investments 1,399 1,260
Other 46 (15)
Cash flows from investing activities (987) (681)
Cash flows from financing activities
Repayment of debt (500)
Dividends paid (1,298) (1,236)
Stock repurchases (48) (119)
Proceeds from common stock transactions 16 125
Other (51) (12)
Cash flows from financing activities (1,881) (1,242)
Net change in cash and cash equivalents 551 267
Cash and cash equivalents at beginning of period 3,660 3,044
Cash and cash equivalents at end of period $
4,211 $
3,311
Supplemental cash flow information
Investment tax credit (ITC) used to reduce income taxes payable $
79 $
43
Proceeds from CHIPS Act incentives 75
Total cash benefit related to the CHIPS Act $
79 $
118
Segment results
(In millions) Q3 2026 Q3 2025 Change
Analog:
Revenue $
4,911 $
3,729 32 %
Operating profit $
2,505 $
1,486 69 %
Embedded Processing:
Revenue $
858 $
709 21 %
Operating profit $
227 $
108 110 %
Other:
Revenue $
286 $
304 (6) %
Operating profit * $
142 $
69 106 %
* Includes Acquisition charges and Restructuring charges/other
Non-GAAP financial information
This release includes references to free cash flow and ratios based on that measure. These are financial measures that were not prepared in accordance with GAAP. Free cash flow is calculated as cash flows from operating activities (also referred to as cash flow from operations) less capital expenditures, plus proceeds from CHIPS Act incentives.
We believe that free cash flow and the associated ratios provide insight into our liquidity, our cash-generating capability and the amount of cash potentially available to return to shareholders, as well as insight into our financial performance. These non-GAAP measures are supplemental to the comparable GAAP measures.
Reconciliation to the most directly comparable GAAP measures is provided in the table below.
For Three For 12
Months
Ended Months
September 30, Ended
September 30,
(In millions) 2026 2026 2025 Change
Cash flow from operations (GAAP) * $
3,419 $
9,896 $
6,897 43 %
Capital expenditures (463) (2,578) (4,817)
Proceeds from CHIPS Act incentives 1,104 335
Free cash flow (non-GAAP) $
2,956 $
8,422 $
2,415 249 %
Revenue $
20,766 $
17,266
Cash flow from operations as a percentage of revenue (GAAP) 47.7 % 39.9 %
Free cash flow as a percentage of revenue (non-GAAP) 40.6 % 14.0 %
* Includes cash benefits of $79 million, $469 million and $302 million from the CHIPS Act ITC used to reduce income taxes payable for the
three months ended September 30, 2026, and the twelve months ended September 30, 2026 and 2025, respectively.
This release also includes references to operating taxes, a non-GAAP term we use to describe taxes calculated using the estimated annual effective tax rate, a GAAP measure that by definition does not include discrete tax items. We believe the term operating taxes helps to differentiate from effective taxes, which include discrete tax items.
Notice regarding forward-looking statements
This release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as TI or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe TI's business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements.
We urge you to carefully consider the following important factors that could cause actual results to differ materially from the expectations of TI or our management:
- Economic, social and political conditions, and natural events in the countries in which we, our customers or our suppliers operate, including global trade policies;
- Our ability to compete in products and prices in an intensely competitive industry;
- Market demand for semiconductors, particularly in the industrial and automotive markets, and customer demand that differs from forecasts;
- Losses or curtailments of purchases from key customers or the timing and amount of customer inventory adjustments;
- Evolving cybersecurity and other threats relating to our information technology systems or those of our customers, suppliers and other third parties;
- Our ability to successfully implement and realize opportunities from strategic, business and organizational changes, or our ability to realize our expectations regarding the amount and timing of associated restructuring charges and cost savings;
- Our ability to develop, manufacture and market innovative products in a rapidly changing technological environment, our timely implementation of new manufacturing technologies and installation of manufacturing equipment, and our ability to realize expected returns on significant investments in manufacturing capacity;
- Availability and cost of key materials, utilities, manufacturing equipment, third-party manufacturing services and manufacturing technology;
- Our ability to retain, train and recruit skilled personnel and effectively manage key employee succession;
- Product liability, warranty or other claims relating to our products, software, manufacturing, delivery, services, design or communications, or recalls by our customers for a product containing one of our parts;
- Financial difficulties of our distributors or semiconductor distributors' promotion of competing product lines to our detriment; or disputes with current or former distributors;
- Our ability to maintain or improve profit margins, including our ability to utilize our manufacturing facilities at sufficient levels to cover our fixed operating costs, in an intensely competitive and cyclical industry and changing regulatory environment;
- Compliance with or changes in the complex laws, rules and regulations to which we are or may become subject, or actions of enforcement authorities, that restrict our ability to operate our business or subject us to fines, penalties or other legal liability;
- Changes in tax law and accounting standards that impact the tax rate applicable to us, the jurisdictions in which profits are determined to be earned and taxed, adverse resolution of tax audits, increases in tariff rates, and the ability to realize deferred tax assets;
- Our ability to maintain and enforce a strong intellectual property portfolio and maintain freedom of operation in all jurisdictions where we conduct business; or our exposure to infringement claims;
- Our ability to make principal and interest payments on our debt when due;
- Instability in the global credit and financial markets; and
- Impairments of our non-financial assets.
For a more detailed discussion of these factors, see the Risk factors discussion in Item 1A of our most recent Form 10-K. The forward-looking statements included in this release are made only as of the date of this release, and we undertake no obligation to update the forward-looking statements to reflect subsequent events or circumstances. If we do update any forward-looking statement, you should not infer that we will make additional updates with respect to that statement or any other forward-looking statement.
About Texas Instruments
Texas Instruments Incorporated (Nasdaq: TXN) is a global semiconductor company that designs, manufactures and sells analog and embedded processing chips for markets such as industrial, automotive, data center, personal electronics and communications equipment. At our core, we have a passion to create a better world by making electronics more affordable through semiconductors. This passion is alive today as each generation of innovation builds upon the last to make our technology more reliable, more affordable and lower power, making it possible for semiconductors to go into electronics everywhere. Learn more at TI.com.
TXN-G
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SOURCE Texas Instruments Incorporated
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