Texas Instruments (TXN) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached $4.83 billion, up 19% year-over-year, driven by industrial and data center growth.

• Net income for Q1 2026 was $1.55 billion, with EPS of $1.68, including a $0.05 benefit from discrete tax items above guidance.

• Announced a definitive agreement to acquire Silicon Labs for $7.5 billion, expected to close in H1 2027.

• Free cash flow for the trailing 12 months was $4.4 billion, with $6.0 billion returned to shareholders over the same period.

Financial highlights

• Gross profit was $2.8 billion (58% of revenue), with gross margin up 210 bps sequentially.

• Operating profit was $1.81 billion (37.5% of revenue), up 37% year-over-year.

• Operating expenses (R&D and SG&A) totaled $974 million in Q1.

• Cash and short-term investments totaled $5.1 billion at quarter end.

• Cash flow from operations for Q1 2026 was $1.52 billion, up $671 million year-over-year.

Outlook and guidance

• Q2 2026 revenue expected between $5.0 billion and $5.4 billion; EPS guidance of $1.77–$2.05.

• Effective tax rate for Q2 projected at 13%.

• Free cash flow per share for 2026 likely to exceed $8 if revenue growth sustains mid- to high-single digits.

• CapEx for 2026 expected at $2–$3 billion, nearing the end of a six-year elevated cycle.

• Continued benefit expected from CHIPS Act incentives, including direct funding and tax credits.