Texas Instruments (TXN) Q4 2025 earnings summary

Executive summary

• Q4 2025 revenue was $4.42 billion, up 10% year-over-year but down 7% sequentially, with analog and embedded processing segments showing strong annual growth.

• Net income for Q4 2025 was $1.16 billion, a 3% decrease from Q4 2024.

• Industrial, automotive, and data center markets now comprise 75% of annual revenue, reflecting a strategic shift and strong secular content growth.

• The company is well positioned with inventory and capacity to meet real-time customer demand, supporting a flexible response to market conditions.

• $6.5 billion was returned to shareholders over the past 12 months through dividends and stock repurchases.

Financial highlights

• Q4 gross profit was $2.5 billion (56% margin), with operating profit at $1.5 billion (33% margin), and net income of $1.2 billion ($1.27 EPS, including a $0.06 reduction from non-cash impairment and tax items).

• Annual revenue for 2025 was $17.68 billion, up from $15.64 billion in 2024.

• Annual net income for 2025 was $5.00 billion, up from $4.80 billion in 2024.

• Cash flow from operations was $2.3 billion in Q4 and $7.2 billion for 2025; free cash flow for 2025 was $2.9 billion, up 96% from 2024.

• Capital expenditures were $925 million in Q4 and $4.6 billion for 2025, nearing the end of a 6-year elevated CapEx cycle.

Outlook and guidance

• Q1 2026 revenue guidance is $4.32–$4.68 billion, with EPS expected between $1.22–$1.48.

• Effective tax rate for 2026 projected at 13–14%.

• CapEx for 2026 expected between $2–$3 billion, with depreciation of $2.2–$2.4 billion.

• No significant price increases planned; overall pricing expected to decline low single digits in 2026.