01—Abstract
Summary
Summary of the 10-Q filed April 24, 2026. Cited figures are marked; the original filing is the authoritative source.
Texas Instruments (TXN) reported a strong first quarter for 2026, with significant year-over-year growth in revenue and net income.
Revenue increased by 19% to $4.83 billiona, driven by robust demand in the industrial and automotive sectors, and further bolstered by growth in data center applications. Net income saw a substantial jump of 31%, reaching $1.55 billion, which translated to diluted earnings per share (EPS) of $1.68, up from $1.28 in the prior year's quarter. This performance reflects the company's strategic focus on its Analog and Embedded Processing segments and its ability to capitalize on the ongoing recovery in the semiconductor market.
The company highlighted its robust financial position and commitment to shareholder returns. Despite a temporary increase in acquisition charges related to the pending acquisition of Silicon Labs, operating profit margins improved, demonstrating operational efficiency.
TXN continues to invest in its manufacturing capabilities, particularly in 300mm wafer production, positioning itself for long-term free cash flow growth. The company also noted significant cash flow from operations and a strategic approach to capital allocation, including continued dividend payments and share repurchases, underscoring its confidence in sustained performance and shareholder value creation.
02—Key points
Key Highlights
- Revenue for the first quarter of 2026 surged 19% year-over-year to $4.83 billion, indicating strong market demand.
- Net income increased by 31% to $1.55 billion, resulting in diluted EPS of $1.68, a significant improvement from $1.28 in Q1 2025.
- The Analog segment showed strong growth, with revenue up 22% and operating profit up 36%, driven by Power and Signal Chain product lines.
- Operating expenses (R&D and SG&A) remained relatively flat year-over-year at $974 million, contributing to improved operating margins.
- The company generated $1.52 billion in cash flow from operating activities, a substantial increase from $849 million in the prior year, underscoring business model strength.
- TXN is progressing with the planned acquisition of Silicon Labs, a $7.5 billion all-cash transaction expected to close in the first half of 2027, though it incurred $17 million in acquisition charges during the quarter.
- Total cash and short-term investments stood at $5.10 billion, providing ample liquidity and financial flexibility.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Texas Instruments kept $0.32.
- Revenue$4.83B100.0%
- Cost of revenue−$2.03B42.0%
- Gross profit$2.80B58.0%
- Operating costs−$991.0M20.5%
- Operating income$1.81B37.5%
- Interest, other & tax−$263.0M5.5%
- Net income$1.54B32.0%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 24, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $4.83B$4.07B | +18.6% |
| Cost of Revenue | $2.03B$1.76B | +15.4% |
| Gross Profit | $2.80B$2.31B | +21.0% |
| R&D Expenses | $510.00M$517.00M | −1.4% |
| SG&A Expenses | $464.00M$472.00M | −1.7% |
| Operating Income | $1.81B$1.32B | +36.6% |
| Net Income | $1.54B$1.18B | +31.0% |
| EPS (Basic) | $1.69$1.29 | +31.0% |
| EPS (Diluted) | $1.68$1.28 | +31.2% |
| Shares Outstanding (Basic) | 909.00M910.00M | −0.1% |
| Shares Outstanding (Diluted) | 914.00M916.00M | −0.2% |
05—Questions
Frequently Asked Questions
What are the key drivers of Texas Instruments' revenue growth in Q1 2026?
Revenue growth in Q1 2026 was primarily driven by increased demand in the Analog segment, particularly in Power and Signal Chain product lines, and to a lesser extent, in the Embedded Processing segment. Growth was also supported by demand in the industrial, automotive, and data center markets.
How is Texas Instruments managing its capital expenditures and investments?
TXN is nearing the end of a six-year elevated capital expenditure cycle focused on 300mm wafer production. For 2026, capital expenditures are expected to be between $2 billion and $3 billion. The company is also benefiting from the U.S. CHIPS and Science Act, which provides direct funding and investment tax credits for its manufacturing facilities.
What is the status and financial impact of the Silicon Labs acquisition?
Texas Instruments has entered into a definitive agreement to acquire Silicon Labs for approximately $7.5 billion in an all-cash transaction, expected to close in the first half of 2027, pending regulatory and shareholder approvals. In Q1 2026, the company incurred $17 million in acquisition charges related to this transaction. The deal is expected to be funded by existing cash and debt financing.
How has Texas Instruments' free cash flow performance been?
For the trailing twelve months ended March 31, 2026, Texas Instruments reported free cash flow of $4.35 billion, a significant increase from $1.72 billion in the prior year period. This growth is attributed to strong cash flow from operations and effective capital expenditure management, with proceeds from CHIPS Act incentives also contributing.
06—Continue