TI reports third quarter 2026 financial results and shareholder returns

TI reports third quarter 2026 financial results and shareholder returns 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:

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 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 2025

Change

Dividends paid

1,298

5,174

4,949

5 %

Stock repurchases

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

—

Restructuring charges/other

—

Operating profit

2,874

1,663

Other income (expense), net (OI&E)

Interest and debt expense

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

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

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

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

Stock compensation

Deferred taxes

(26)

Increase (decrease) from changes in:

Accounts receivable

(100)

(128)

Inventories

(67)

(17)

Prepaid expenses and other current assets

Accounts payable and accrued expenses

Accrued compensation

135

121

Income taxes payable

319

107

Changes in funded status of retirement plans

(6)

Other

(23)

Cash flows from operating activities

3,419

2,190

Cash flows from investing activities

Capital expenditures

(463)

(1,197)

Proceeds from CHIPS Act incentives

—

Proceeds from asset sales

—

Purchases of short-term investments

(1,969)

(805)

Proceeds from short-term investments

1,399

1,260

Other

(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

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

Proceeds from CHIPS Act incentives

—

Total cash benefit related to the CHIPS Act

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

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

Months

Ended

September 30,

For 12

Months

Ended

September 30,

(In millions)

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:

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

SOURCE Texas Instruments Incorporated