TEXAS INSTRUMENTS INC
For the period ended Sep 30, 2025. Filed Oct 23, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 23, 2025
TXN$277.36-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-07-29.
0000097476-25-000036
Item 2. Management’s discussion and analysis of financial condition and results of operationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-10-23.
0000097476-25-000060
Item 2. Management’s discussion and analysis of financial condition and results of operationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 94 previous paragraphs and 97 current paragraphs.
47 unchanged; 42 reworded; 8 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
In 2020, we announced a multi-year plan to close our two remaining factories with 150mm production, which are more than 50 years old and located in Sherman and Dallas, Texas. Production is transitioning from these sites to our more advanced and cost-effective 300mm wafer fabrication facilities.
Current report
Revenue increased 7% sequentially and 14% from the same quarter a year ago with growth across all end markets.
Current report
Restructuring charges/other was $85 million related to efforts to drive operational efficiencies to support our long-term strategy, including the planned closures of our two remaining factories with 150mm production.
Current report
Net income was $1.36 billion in both periods. EPS was $1.48 compared with $1.47.
Current report
Third quarter 2025 segment results
Current report
Operating expenses were $2.98 billion compared with $2.82 billion.
Current report
Net income was $3.84 billion compared with $3.59 billion. EPS was $4.18 compared with $3.89.
Current report
In September 2025, we announced we would increase our quarterly cash dividend by 4% to $1.42 per share, marking 22 consecutive years of dividend increases.
Removed paragraphs (5)
Previous report
Revenue increased 9% sequentially, led by continued broad recovery in industrial, and 16% from the same quarter a year ago.
Previous report
Net income was $1.30 billion compared with $1.13 billion. EPS was $1.41 compared with $1.22.
Previous report
Second quarter 2025 segment results
Previous report
Operating expenses were $2.00 billion compared with $1.90 billion.
Previous report
Net income was $2.47 billion compared with $2.23 billion. EPS was $2.69 compared with $2.42.
Reworded paragraphs (42)
Previous wording
(a) A strong foundation of manufacturing and technology that provides lower costs and greater control of our supply chain.
Current wording
(a)A strong foundation of manufacturing and technology that provides lower costs and greater control of our supply chain.
Previous wording
(b) A broad portfolio of analog and embedded processing products that offers more opportunity per customer and more value for our investments.
Current wording
(b)A broad portfolio of analog and embedded processing products that offers more opportunity per customer and more value for our investments.
Previous wording
(c) The reach of our market channels that gives access to more customers and more of their design projects, leading to the opportunity to sell more of our products into each design and gives us better insight and knowledge of customer needs.
Current wording
(c)The reach of our market channels that gives access to more customers and more of their design projects, leading to the opportunity to sell more of our products into each design and gives us better insight and knowledge of customer needs.
Previous wording
(d) Diversity and longevity of our products, markets and customer positions that provide less single point dependency and longer returns on our investments.
Current wording
(d)Diversity and longevity of our products, markets and customer positions that provide less single point dependency and longer returns on our investments.
Previous wording
The major markets for our products are industrial, automotive, personal electronics, enterprise systems, communications equipment and other. See our 2024 Form 10-K for more information.
Current wording
The end markets for our products are industrial, automotive, personal electronics, enterprise systems and communications equipment. See our 2024 Form 10-K for more information, where we also report calculators and other.
Previous wording
Our objectives for inventory are to maintain high levels of customer service, maintain dependable and competitive lead times, minimize inventory obsolescence and improve manufacturing asset utilization. To meet these objectives and to allow greater flexibility in periods of high demand, our strategy is to build ahead of demand our broad-based products that are used across a diverse set of applications and customers and have low risk of obsolescence. Inventory levels will vary based on market conditions and seasonality.
Current wording
Our objectives for inventory are to maintain high levels of customer service, maintain dependable and competitive lead times, minimize inventory obsolescence and improve manufacturing asset utilization. To meet these objectives and to allow greater flexibility in periods of high demand, our strategy is to build ahead of demand our broad-based products that are used across a diverse set of applications and customers and have low risk of obsolescence. Inventory levels will vary based on market conditions and seasonality. We adjust factory loadings as needed to execute on this inventory strategy.
Previous wording
Our second quarter revenue was $4.45 billion, net income was $1.30 billion and earnings per share (EPS) were $1.41.
Current wording
Our third quarter revenue was $4.74 billion, net income was $1.36 billion and earnings per share (EPS) were $1.48.
Previous wording
Our cash flow from operations of $6.4 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 $1.8 billion.
Current wording
Our cash flow from operations of $6.9 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 $2.4 billion.
Previous wording
Over the past 12 months we invested $3.9 billion in R&D and SG&A, invested $4.9 billion in capital expenditures and returned $6.7 billion to shareholders.
Current wording
Over the past 12 months we invested $3.9 billion in R&D and SG&A, invested $4.8 billion in capital expenditures and returned $6.6 billion to shareholders.
Previous wording
We believe tariffs and geopolitics are disrupting and reshaping global supply chains and affecting customer order behavior. Our global manufacturing capabilities enable us to support our customers’ needs. We also believe the semiconductor cycle recovery is continuing, while customer inventories remain at low levels.
Current wording
We believe trade dynamics and geopolitics are disrupting and reshaping global supply chains and affecting customer order behavior. Our global manufacturing capabilities enable us to support our customers’ needs. The overall semiconductor market recovery is continuing, though at a slower pace than prior upturns, likely related to broader macroeconomic dynamics and overall uncertainty.
Previous wording
On July 4, 2025, the U.S. government enacted the One Big Beautiful Bill Act (OBBBA). The OBBBA provides changes to U.S. federal tax law, including expensing of U.S. research expenditures and eligible capital expenditures, increasing the U.S. CHIPS and Science Act (CHIPS Act) investment tax credit (ITC) and changing other tax provisions. The new law did not impact our financial condition and results of operations during the second quarter. We are currently evaluating the impact of the legislation on future periods. Based on our initial assessment, the changes are expected to result in a higher effective tax rate in the third quarter and full year 2025. For 2026 and beyond, we expect the effective tax rate to be lower than it would have been under prior tax law. Additionally, we expect tax-related cash payments to be lower for the next several years as a result of the changes.
Current wording
On July 4, 2025, the U.S. government enacted the One Big Beautiful Bill Act (OBBBA). The OBBBA provides changes to U.S. federal tax law, including expensing of U.S. research expenditures and eligible capital expenditures, increasing the U.S. CHIPS and Science Act (CHIPS Act) investment tax credit (ITC) and changing other tax provisions. The effect of the new law results in a higher effective tax rate in the third quarter and full year 2025. For 2026 and beyond, we expect the effective tax rate to be lower than it would have been under prior tax law. Additionally, we expect tax-related cash payments to be lower for the next several years as a result of the changes.
Previous wording
Details of financial results – second quarter 2025 compared with second quarter 2024
Current wording
Details of financial results – third quarter 2025 compared with third quarter 2024
Previous wording
Revenue of $4.45 billion increased $626 million, or 16%, due to higher revenue from increased demand in our Analog segment and, to a lesser extent, in our Embedded Processing segment, which were both impacted by the macroeconomic factors discussed above.
Current wording
Revenue of $4.74 billion increased $591 million, or 14%, due to higher revenue from increased demand in our Analog segment and, to a lesser extent, in our Embedded Processing segment, which were both impacted by the macroeconomic factors discussed above.
Previous wording
Gross profit of $2.58 billion was up $364 million, or 16%, due to higher revenue. Our gross profit also benefited from reduced manufacturing costs related to increased factory loadings, offset by costs associated with our planned capacity expansions. As a percentage of revenue, gross profit increased to 57.9% from 57.8%.
Current wording
Gross profit of $2.72 billion was up $249 million, or 10%, due to higher revenue, partially offset by higher manufacturing costs associated with our planned capacity expansions. As a percentage of revenue, gross profit decreased to 57.4% from 59.6%.
Previous wording
Operating expenses (R&D and SG&A) were $1.01 billion compared with $963 million.
Current wording
Operating expenses (R&D and SG&A) were $975 million compared with $920 million.
Previous wording
Operating profit was $2.89 billion, or 33.9% of revenue, compared with $2.53 billion, or 33.9% of revenue. This increase was primarily due to higher revenue and associated gross profit.
Current wording
Operating profit was $1.66 billion, or 35.1% of revenue, compared with $1.55 billion, or 37.4% of revenue. This change was primarily due to higher revenue, partially offset by higher manufacturing costs.
Previous wording
OI&E was $48 million of income compared with $130 million of income. This decrease was due to lower interest income.
Current wording
OI&E was $62 million of income compared with $131 million of income. This decrease was due to lower interest income.
Previous wording
Interest and debt expense of $133 million increased $2 million. See Note 6 to the financial statements.
Current wording
Interest and debt expense of $141 million increased $10 million. See Note 6 to the financial statements.
Previous wording
Our provision for income taxes was $183 million compared with $120 million. This increase was due to higher income before income taxes and lower discrete tax benefits of $34 million, due to stock-based compensation. Our effective tax rate, which includes discrete tax items, was 12% compared with 10%.
Current wording
Our provision for income taxes was $220 million compared with $192 million. This increase was primarily due to changes in the effect of U.S. tax benefits, including the effect of OBBBA, lower discrete tax benefits and higher income before income taxes. Our effective tax rate, which includes discrete tax items, was 14% compared with 12%.
Previous wording
Analog revenue increased in Power and, to a lesser extent, Signal Chain, due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit increased primarily due to higher revenue and associated gross profit.
Current wording
Analog revenue increased in both product lines, led by Signal Chain, due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit increased primarily due to higher revenue, partially offset by higher manufacturing costs and operating expenses.
Previous wording
Embedded Processing revenue increased due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit increased primarily due to higher revenue, partially offset by increased manufacturing costs and R&D expenses.
Current wording
Embedded Processing revenue increased due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit was about even due to higher manufacturing costs and operating expenses, offset by higher revenue.
Previous wording
Other revenue increased $77 million, and operating profit decreased $63 million.
Current wording
Other revenue increased $29 million, and operating profit decreased $60 million.
Previous wording
Details of financial results – first six months of 2025 compared with first six months of 2024
Current wording
Details of financial results – first nine months of 2025 compared with first nine months of 2024
Previous wording
Revenue of $8.52 billion increased $1.03 billion, or 14%, due to higher revenue from increased demand in our Analog segment and, to a lesser extent, in our Embedded Processing segment, which were both impacted by the macroeconomic factors discussed above.
Current wording
Revenue of $13.26 billion increased $1.63 billion, or 14%, due to higher revenue from increased demand in our Analog segment and, to a lesser extent, in our Embedded Processing segment, which were both impacted by the macroeconomic factors discussed above.
Previous wording
Gross profit of $4.89 billion was up $582 million, or 14%, due to higher revenue. Our gross profit also benefited from reduced manufacturing costs related to increased factory loadings, partially offset by costs associated with our planned capacity expansions. As a percentage of revenue, gross profit decreased to 57.4% from 57.5%.
Current wording
Gross profit of $7.61 billion was up $831 million, or 12%, due to higher revenue. Our gross profit was also impacted by higher manufacturing costs associated with our planned capacity expansions, partially offset by reduced costs related to increased factory loadings. As a percentage of revenue, gross profit decreased to 57.4% from 58.3%.
Previous wording
Restructuring charges/other in the year-ago period was a credit of $124 million primarily due to a gain on the sale of a property during 2024.
Current wording
Restructuring charges/other was $85 million related to efforts to drive operational efficiencies to support our long-term strategy, including the planned closures of our two remaining factories with 150mm production, compared with a credit of $124 million primarily due to a gain on the sale of a property during 2024.
Previous wording
Operating profit was $1.56 billion, or 35.1% of revenue, compared with $1.25 billion, or 32.7% of revenue. This increase was primarily due to higher revenue and associated gross profit.
Current wording
Operating profit was $4.55 billion, or 34.3% of revenue, compared with $4.09 billion, or 35.1% of revenue. This change was primarily due to higher revenue and associated gross profit, partially offset by higher operating expenses.
Previous wording
OI&E was $128 million of income compared with $253 million of income. This decrease was due to lower interest income.
Current wording
OI&E was $190 million of income compared with $384 million of income. This decrease was due to lower interest income.
Previous wording
Interest and debt expense of $261 million increased $14 million.
Current wording
Interest and debt expense of $402 million increased $24 million.
Previous wording
Our provision for income taxes was $280 million compared with $308 million. This decrease was due to higher discrete tax benefits of $47 million, primarily related to our non-U.S. operations, partially offset by higher income before income taxes. Our effective tax rate, which includes discrete tax items, was 10% compared with 12%.
Current wording
Our provision for income taxes was $500 million in both periods. This includes an increase in taxes from higher income before income taxes and changes in the effect of U.S. tax benefits, including the effect of OBBBA, offset by higher discrete tax benefits of $41 million, primarily related to our non-U.S. operations. Our effective tax rate, which includes discrete tax items, was 12% in both periods.
Previous wording
Analog revenue increased in Power and, to a lesser extent, Signal Chain, due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit increased primarily due to higher revenue and associated gross profit.
Current wording
Analog revenue increased in both product lines, led by Power, due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit increased primarily due to higher revenue and associated gross profit, partially offset by higher operating expenses.
Previous wording
Embedded Processing revenue increased due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit decreased primarily due to higher manufacturing costs and R&D expenses, partially offset by higher revenue.
Current wording
Embedded Processing revenue increased due to higher demand, which was impacted by the macroeconomic factors discussed above. Operating profit decreased primarily due to higher manufacturing costs and operating expenses, partially offset by higher revenue.
Previous wording
Other revenue increased $38 million, and operating profit increased $32 million.
Current wording
Other revenue increased $106 million, and operating profit decreased $123 million.
Previous wording
At the end of the second quarter of 2025, total cash (cash and cash equivalents plus short-term investments) was $5.36 billion, a decrease of $2.22 billion from the end of 2024.
Current wording
At the end of the third quarter of 2025, total cash (cash and cash equivalents plus short-term investments) was $5.19 billion, a decrease of $2.39 billion from the end of 2024.
Previous wording
Accounts receivable were $1.93 billion, an increase of $215 million compared with the end of 2024. Days sales outstanding were 39 for both the second quarter of 2025 and at the end of 2024.
Current wording
Accounts receivable were $2.06 billion, an increase of $343 million compared with the end of 2024. Days sales outstanding were 39 for both the third quarter of 2025 and at the end of 2024.
Previous wording
Inventory was $4.81 billion, an increase of $285 million from the end of 2024. Days of inventory for the second quarter of 2025 were 231 compared with 241 at the end of 2024, which reflects the continued execution of our inventory strategy.
Current wording
Inventory was $4.83 billion, an increase of $302 million from the end of 2024. Days of inventory for the third quarter of 2025 were 215 compared with 241 at the end of 2024, which reflects the continued execution of our inventory strategy. As our current inventory levels align with our objectives, we expect to moderate factory loadings accordingly.
Previous wording
Our primary source of liquidity is cash flow from operations. Additional sources of liquidity are cash and cash equivalents, short-term investments and access to debt markets. We also have a variable-rate, revolving credit facility. As of June 30, 2025, our credit facility was undrawn, and we had no commercial paper outstanding. Cash flows from operating activities for the first six months of 2025 were $2.71 billion, an increase of $121 million from the year-ago period primarily due to higher net income and non-cash items, partially offset by higher cash used for working capital. Cash flows from operating activities for the first six months of 2025 and 2024 includes cash benefits of $203 million and $312 million, respectively, from the CHIPS Act ITC used to reduce income taxes payable.
Current wording
Our primary source of liquidity is cash flow from operations. Additional sources of liquidity are cash and cash equivalents, short-term investments and access to debt markets. We also have a variable-rate, revolving credit facility. As of September 30, 2025, our credit facility was undrawn, and we had no commercial paper outstanding. Cash flows from operating activities for the first nine months of 2025 were $4.90 billion, an increase of $579 million from the year-ago period primarily due to higher net income and non-cash items, partially offset by higher cash used for working capital. Cash flows from operating activities for the first nine months of 2025 and 2024 includes cash benefits of $246 million and $532 million, respectively, from the CHIPS Act ITC used to reduce income taxes payable.
Previous wording
Investing activities for the first six months of 2025 used $82 million compared with $3.33 billion in the year-ago period. Capital expenditures were $2.43 billion compared with $2.31 billion in the year-ago period and were primarily for semiconductor manufacturing equipment and facilities in both periods. In 2025, we received proceeds of $260 million from CHIPS Act incentives. Short-term investments provided cash of $2.10 billion compared with $1.20 billion of cash used in the year-ago period.
Current wording
Investing activities for the first nine months of 2025 used $763 million compared with $3.82 billion in the year-ago period. Capital expenditures were $3.63 billion in both periods and were primarily for semiconductor manufacturing equipment and facilities. For the first nine months of 2025, we received proceeds of $335 million from CHIPS Act incentives, including $75 million in direct funding. Short-term investments provided cash of $2.55 billion compared with $346 million of cash used in the year-ago period.
Previous wording
We are now mostly through a six-year elevated capital expenditures cycle, and consistent with our capital management strategy, we are currently evaluating our capital expenditure levels to determine if they will remain at elevated levels in 2026 and beyond, dependent on revenue and growth expectations. For qualifying manufacturing investments, we expect to benefit from the 25% ITC established by the CHIPS Act, as well as direct funding of up to $1.6 billion for our three large-scale 300mm wafer fabs currently under construction in Sherman, Texas, and Lehi, Utah. The U.S. tax law changes within the OBBBA included an increase to the CHIPS Act ITC from 25% to 35% for qualifying manufacturing investments placed in service after December 31, 2025.
Current wording
We are now mostly through a six-year elevated capital expenditures cycle, and consistent with our capital management strategy, we are currently evaluating our capital expenditure levels to determine if they will remain at elevated levels in 2026 and beyond, dependent on revenue and growth expectations. We expect to continue benefiting from the CHIPS Act, including the 25% ITC on qualifying manufacturing investments that increases to 35% for assets placed in service after December 31, 2025, and direct funding of up to $1.6 billion for our three large-scale 300mm wafer fabs located in Sherman, Texas, and Lehi, Utah.
Previous wording
Financing activities for the first six months of 2025 used $2.78 billion compared with $517 million of cash provided in the year-ago period. In 2025, we received net proceeds of $1.20 billion from the issuance of fixed-rate, long-term debt and retired maturing debt of $750 million. In the year-ago period, we received net proceeds of $2.98 billion from the issuance of fixed-rate, long-term debt and retired maturing debt of $300 million. Dividends paid were $2.47 billion compared with $2.37 billion in the year-ago period, reflecting an increased dividend rate. We used $955 million to repurchase 5.4 million shares of our common stock compared with $74 million to repurchase 0.4 million shares in the year-ago period. Employee exercises of stock options provided cash proceeds of $233 million compared with $313 million in the year-ago period.
Current wording
Financing activities for the first nine months of 2025 used $4.03 billion compared with $879 million in the year-ago period. We received net proceeds of $1.20 billion from the issuance of fixed-rate, long-term debt and retired maturing debt of $750 million. In the year-ago period, we received net proceeds of $2.98 billion from the issuance of fixed-rate, long-term debt and retired maturing debt of $300 million. Dividends paid were $3.71 billion compared with $3.56 billion in the year-ago period, reflecting an increased dividend rate. We used $1.07 billion to repurchase 6.1 million shares of our common stock compared with $392 million to repurchase 2.0 million shares in the year-ago period. Employee exercises of stock options provided cash proceeds of $358 million compared with $430 million in the year-ago period.
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