01—Abstract
Summary
Summary of the 10-K filed February 14, 2025. Cited figures are marked; the original filing is the authoritative source.
Texas Instruments Inc. (TXN) reported fiscal year 2024 revenue of $15.64 billiona, a decrease of 10.7% from the prior year, primarily driven by lower revenue in its core Analog and Embedded Processing segments.
Despite the revenue decline, the company emphasizes its strategy centered on maximizing long-term free cash flow per share, supported by four competitive advantages: manufacturing/technology, broad product portfolio, market channel reach, and product/market diversity. Significant investments are being made in expanding 300mm manufacturing capacity in Texas and Utah to support future growth and cost efficiencies. The company generated $6.32 billionb in cash flow from operations and $1.50 billion in free cash flow, representing 9.6% of revenue, and returned $5.72 billion to shareholders through dividends and share repurchases.
The CHIPS and Science Act is expected to provide significant financial benefits, including tax credits and direct funding for new manufacturing facilities. While facing industry cyclicality and competitive pressures, Texas Instruments remains focused on disciplined capital allocation and operational efficiency to drive long-term shareholder value.
02—Key points
Key Highlights
- Revenue for 2024 was $15.64 billion, a 10.7% decrease year-over-year, attributed to declines in both Analog and Embedded Processing segments.
- The company's core strategy remains focused on maximizing long-term free cash flow per share growth, leveraging four competitive advantages in manufacturing, product breadth, market channels, and diversity.
- Significant capital expenditures of $4.82 billion were made in 2024, primarily for expanding 300mm wafer fabrication capacity to support future demand and enhance cost advantages.
- Texas Instruments generated $6.32 billion in cash flow from operations and $1.50 billion in free cash flow (9.6% of revenue) in 2024.
- The company returned $5.72 billion to shareholders in 2024 through dividends ($4.80 billion) and share repurchases ($0.93 billion).
- The U.S. CHIPS and Science Act is expected to provide between $7.5 billion to $9.5 billion through 2034, including investment tax credits and direct funding for manufacturing facilities.
- Gross profit margin decreased to 58.1% in 2024 from 62.9% in 2023, largely due to lower revenue and increased manufacturing costs related to capacity expansions.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Texas Instruments kept $0.31.
- Revenue$15.64B100.0%
- Cost of revenue−$6.55B41.9%
- Gross profit$9.09B58.1%
- Operating costs−$3.63B23.2%
- Operating income$5.46B34.9%
- Interest, other & tax−$666.0M4.3%
- Net income$4.80B30.7%
Where FY2024 revenue went
$15.64B- Cost of revenue: $6.55B, 42% of revenue
- Net income: $4.80B, 31% of revenue
- R&D: $1.96B, 13% of revenue
- SG&A: $1.79B, 11% of revenue
- Interest, other & tax: $666.0M, 4.3% of revenue
Kept 31% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 14, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $15.64B$17.52B | −10.7% |
| Cost of Revenue | $6.55B$6.50B | +0.7% |
| Gross Profit | $9.09B$11.02B | −17.5% |
| R&D Expenses | $1.96B$1.86B | +5.2% |
| SG&A Expenses | $1.79B$1.82B | −1.7% |
| Operating Income | $5.46B$7.33B | −25.5% |
| Net Income | $4.80B$6.51B | −26.3% |
| EPS (Basic) | $5.24$7.13 | −26.5% |
| EPS (Diluted) | $5.20$7.07 | −26.4% |
| Shares Outstanding (Basic) | 912.00M908.00M | +0.4% |
| Shares Outstanding (Diluted) | 919.00M916.00M | +0.3% |
05—Questions
Frequently Asked Questions
What are Texas Instruments' primary revenue-generating segments and how did they perform in 2024?
Texas Instruments' primary revenue-generating segments are Analog and Embedded Processing. In 2024, revenue from the Analog segment was $12.16 billion (a 7% decrease year-over-year), and revenue from the Embedded Processing segment was $2.53 billion (a 25% decrease year-over-year). Overall revenue for the company was $15.64 billion, down 10.7% from 2023.
What is Texas Instruments' core strategy for long-term value creation?
Texas Instruments' core strategy is to maximize long-term free cash flow per share growth. This is achieved through three key elements: maintaining a strong business model built on four competitive advantages (manufacturing/technology, broad product portfolio, market channel reach, and product/market diversity), disciplined capital allocation, and a focus on operational efficiency.
How is Texas Instruments investing in its future manufacturing capabilities?
The company is making substantial investments in expanding its 300mm wafer fabrication capacity. Key investments include ramping production at RFAB2 in Texas and LFAB1 in Utah, equipping and constructing SM1 and SM2 in Sherman, Texas, and continuing construction on LFAB2 in Utah. These investments are designed to strengthen its manufacturing and technology competitive advantage, lower costs, enhance supply chain control, and support future revenue growth.
What impact does the CHIPS and Science Act have on Texas Instruments?
The CHIPS and Science Act is a significant tailwind for Texas Instruments. The company expects to receive between $7.5 billion to $9.5 billion through 2034. This includes a 25% investment tax credit for qualified U.S. manufacturing investments and direct funding of up to $1.6 billion for its new wafer fabrication facilities in Sherman, Texas, and Lehi, Utah. In 2024, the company recognized a $588 million cash benefit from the CHIPS Act Investment Tax Credit.
06—Continue