TI reports second quarter 2026 financial results and shareholder returns

TI reports second quarter 2026 financial results and shareholder returns Conference call at 3:30 p.m. Central time today on ti.com/ir

DALLAS, July 22, 2026 /PRNewswire/ -- Texas Instruments Incorporated (TI) (Nasdaq: TXN) today reported second quarter revenue of $5.46 billion, net income of $1.98 billion and earnings per share of $2.14. Earnings per share included a 5-cent benefit 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)

Q2 2026

Q2 2025

Change

Revenue

5,463

4,448

23 %

Operating profit

2,310

1,563

48 %

Net income

1,980

1,295

53 %

Earnings per share

2.14

1.41

52 %

Cash generation

Trailing 12 Months

(In millions)

Q2 2026

Q2 2025

Change

Cash flow from operations

2,703

8,667

6,439

35 %

Free cash flow

2,738

6,534

1,763

271 %

Free cash flow % of revenue

33.6 %

10.6 %

Cash return

Trailing 12 Months

(In millions)

Q2 2026

Q2 2025

Change

Dividends paid

1,295

5,112

4,900

4 %

Stock repurchases

707

1,810

(61) %

Total cash returned

1,322

5,819

6,710

(13) %

TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Income

For Three Months Ended

June 30,

(In millions, except per-share amounts)

2026

2025

Revenue

5,463

4,448

Cost of revenue (COR)

2,111

1,873

Gross profit

3,352

2,575

Research and development (R&D)

535

527

Selling, general and administrative (SG&A)

490

485

Acquisition charges

—

Operating profit

2,310

1,563

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

Interest and debt expense

141

133

Income before income taxes

2,238

1,478

Provision for income taxes

258

183

Net income

1,980

1,295

Diluted earnings per common share

2.14

1.41

Average shares outstanding:

Basic

912

908

Diluted

920

912

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)

309

199

Discrete tax items

(51)

(16)

Provision for income taxes (effective taxes)

258

183

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

1,980

1,295

Income allocated to RSUs

(11)

(7)

Income allocated to common stock for diluted EPS

1,969

1,288

TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

June 30,

(In millions, except par value)

2026

2025

Assets

Current assets:

Cash and cash equivalents

3,660

3,044

Short-term investments

3,341

2,315

Accounts receivable, net of allowances of ($22) and ($24)

2,520

1,934

Raw materials

467

402

Work in process

2,407

2,429

Finished goods

1,731

1,981

Inventories

4,605

4,812

Prepaid expenses and other current assets

1,631

2,379

Total current assets

15,757

14,484

Property, plant and equipment at cost

17,856

16,878

Accumulated depreciation

(5,945)

(4,557)

Property, plant and equipment

11,911

12,321

Goodwill

4,330

4,362

Deferred tax assets

1,017

1,096

Capitalized software licenses

314

248

Overfunded retirement plans

316

253

Other long-term assets

2,237

2,169

Total assets

35,882

34,933

Liabilities and stockholders' equity

Current liabilities:

Current portion of long-term debt

1,149

—

Accounts payable

680

881

Accrued compensation

536

595

Income taxes payable

Accrued expenses and other liabilities

809

963

Total current liabilities

3,244

2,492

Long-term debt

12,903

14,043

Underfunded retirement plans

123

122

Deferred tax liabilities

Other long-term liabilities

1,550

1,810

Total liabilities

17,875

18,530

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

5,129

4,245

Retained earnings

53,161

52,249

Treasury common stock at cost

Shares: June 30, 2026 – 828; June 30, 2025 – 832

(41,941)

(41,676)

Accumulated other comprehensive income (loss), net of taxes (AOCI)

(83)

(156)

Total stockholders' equity

18,007

16,403

Total liabilities and stockholders' equity

35,882

34,933

TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For Three Months Ended

June 30,

(In millions)

2026

2025

Cash flows from operating activities

Net income

1,980

1,295

Adjustments to net income:

Depreciation

547

460

Amortization of capitalized software

Stock compensation

127

129

Gains on sales of assets

(8)

—

Deferred taxes

(62)

(50)

Increase (decrease) from changes in:

Accounts receivable

(275)

(74)

Inventories

(125)

Prepaid expenses and other current assets

(9)

Accounts payable and accrued expenses

101

Accrued compensation

142

172

Income taxes payable

(14)

(71)

Changes in funded status of retirement plans

(18)

Other

Cash flows from operating activities

2,703

1,860

Cash flows from investing activities

Capital expenditures

(514)

(1,305)

Proceeds from CHIPS Act incentives

549

—

Proceeds from asset sales

—

Purchases of short-term investments

(2,407)

(1,192)

Proceeds from short-term investments

636

1,131

Other

Cash flows from investing activities

(1,702)

(1,335)

Cash flows from financing activities

Proceeds from issuance of long-term debt

—

1,199

Dividends paid

(1,295)

(1,235)

Stock repurchases

(27)

(302)

Proceeds from common stock transactions

445

115

Other

(13)

(21)

Cash flows from financing activities

(890)

(244)

Net change in cash and cash equivalents

111

281

Cash and cash equivalents at beginning of period

3,549

2,763

Cash and cash equivalents at end of period

3,660

3,044

Supplemental cash flow information

Investment tax credit (ITC) used to reduce income taxes payable

301

203

Proceeds from CHIPS Act incentives

549

—

Total cash benefit related to the CHIPS Act

850

203

Segment results

(In millions)

Q2 2026

Q2 2025

Change

Analog:

Revenue

4,365

3,452

26 %

Operating profit

1,992

1,325

50 %

Embedded Processing:

Revenue

788

679

16 %

Operating profit

168

98 %

Other:

Revenue

310

317

(2) %

Operating profit *

150

153

(2) %

* Includes Acquisition charges

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

June 30,

For 12

Months

Ended

June 30,

(In millions)

2026

2025

Change

Cash flow from operations (GAAP) *

2,703

8,667

6,439

35 %

Capital expenditures

(514)

(3,312)

(4,936)

Proceeds from CHIPS Act incentives

549

1,179

260

Free cash flow (non-GAAP)

2,738

6,534

1,763

271 %

Revenue

19,453

16,675

Cash flow from operations as a percentage of revenue (GAAP)

44.6 %

38.6 %

Free cash flow as a percentage of revenue (non-GAAP)

33.6 %

10.6 %

* Includes cash benefits of $301 million, $433 million and $479 million from the CHIPS Act ITC used to reduce income taxes payable for the three

months ended June 30, 2026, and the twelve months ended June 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 TI's 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