TI(US:TXN) Huachuang Securities·2025-04-25 10:19Investment Rating - The industry investment rating is "Recommended," indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [47]. Core Insights - The report highlights that Texas Instruments (TXN) achieved Q1 FY2025 revenue of $4.069 billion, exceeding guidance and market expectations, with a year-over-year growth of 11% and a quarter-over-quarter increase of 1.55% [2][3][8]. - The semiconductor industry is currently at the bottom of the market cycle, with low customer inventory levels, while the industrial market is showing signs of recovery after seven consecutive quarters of decline [3][16]. - The company expects Q2 FY2025 revenue guidance to be between $4.17 billion and $4.53 billion, with an EPS range of $1.21 to $1.47, reflecting a positive outlook for the upcoming quarter [4][17]. Summary by Sections 1. Overall Revenue Situation - Texas Instruments reported Q1 FY2025 revenue of $4.069 billion, surpassing the upper end of guidance ($3.74 - $4.06 billion) and market consensus ($3.909 billion) [3][8]. - The revenue breakdown shows a 13% year-over-year increase in analog business, while embedded processing remained flat, and other segments grew by 23% [3][12][14]. 2. Operating Expenses - Operating expenses for Q1 FY2025 were $989 million, a 6% increase year-over-year, aligning with company expectations [9]. 3. Inventory Situation - As of the end of Q1 FY2025, inventory stood at $4.7 billion, a quarter-over-quarter increase of $160 million, with inventory days at 240, down by one day from the previous quarter [10]. 4. Cash Flow and Capital Expenditures - The company generated operating cash flow of $849 million in Q1 FY2025, with total cash and short-term investments at $5 billion [11]. - Capital expenditures for Q1 FY2025 were $1.1 billion, with a total of $4.7 billion over the past 12 months [11]. 5. Revenue by Business Segment - Analog business revenue was $3.21 billion, accounting for 78.9% of total revenue, with a 13% year-over-year increase [12]. - Embedded processing revenue was $647 million, showing a slight decline of 1% year-over-year [13]. - Other business revenue reached $212 million, reflecting a 23% year-over-year growth [14]. 6. Terminal Market Demand Outlook - The industrial market has shown a high single-digit growth after a prolonged decline, while the automotive market experienced low single-digit growth [16]. - Consumer electronics faced a seasonal decline, while enterprise systems and communication equipment saw moderate growth [16]. 7. Q2 FY2025 Company Guidance - The revenue guidance for Q2 FY2025 is set between $4.17 billion and $4.53 billion, with a midpoint indicating a 6.91% quarter-over-quarter growth and a 13.81% year-over-year growth [17].