Texas Instruments (NasdaqGS:TXN) Q3 2025 Earnings Call October 21, 2025 04:30 PM ET Company ParticipantsRafael Lizardi - Senior VP and CFOHaviv Ilan - CEOTimothy Arcuri - Managing DirectorMike Beckman - Head of Investor RelationsConference Call ParticipantsChristopher Danely - Managing Director and Senior Semiconductor Equity Research AnalystChristopher Caso - Managing Director and Senior Equity AnalystStacy Rasgon - Managing Director and Senior AnalystTorres Vanberg - Equity Research AnalystJoseph Moore - ...

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $4.7 billion, reflecting a 7% sequential increase and a 14% year-over-year increase [3] - Gross profit was $2.7 billion, representing 57% of revenue, with a sequential decrease of 50 basis points in gross profit margin [5] - Operating profit was $1.7 billion, or 35% of revenue, up 7% from the previous year [5] - Net income for the quarter was $1.4 billion, translating to $1.48 per share, which included a $0.10 reduction due to restructuring charges [5][6] - Cash flow from operations was $2.2 billion for the quarter and $6.9 billion on a trailing 12-month basis [6] Business Line Data and Key Metrics Changes - Analog revenue grew 16% year-over-year, while Embedded Processing revenue increased by 9% [3] - The industrial market saw a 25% year-over-year increase and low single-digit growth sequentially [4] - The automotive market increased upper single digits year-over-year and around 10% sequentially [4] - Personal electronics grew low single digits year-over-year and upper single digits sequentially [4] - Enterprise systems grew about 35% year-over-year and 20% sequentially [4] - Communications equipment grew approximately 45% year-over-year and about 10% sequentially [4] Market Data and Key Metrics Changes - Customer inventories remain low, and inventory depletion appears to be behind the company [3] - The overall semiconductor market recovery is ongoing but at a slower pace than previous upturns due to macroeconomic dynamics [3] Company Strategy and Development Direction - The company plans to focus on long-term value creation through disciplined capital allocation and strengthening competitive advantages [9] - The company is winding down its 150mm fabs, with expected cost reductions through the first half of 2026 [15] - The company aims to continue investing in manufacturing, technology, and a broad product portfolio to enhance its market position [9][35] Management's Comments on Operating Environment and Future Outlook - Management noted a moderate recovery in the semiconductor market, with hesitancy among customers regarding new investments due to uncertainty in regulations [44] - The automotive sector is recovering well, while the data center market is experiencing strong growth [46] - The company expects Q4 revenue to be in the range of $4.22 to $4.58 billion, with EPS guidance of $1.13 to $1.39 [8] Other Important Information - The company returned $6.6 billion to shareholders over the past 12 months, including $1.2 billion in dividends and $119 million in stock repurchases [7] - The company has a strong balance sheet with $5.2 billion in cash and short-term investments and total debt of $14 billion [8] Q&A Session Summary Question: Can you talk about the linearity of bookings through the quarter? - Management indicated that Q3 was more stable compared to Q2, with no significant changes in bookings throughout the quarter [11] Question: Can you discuss the restructuring and its impact on expenses? - The restructuring is related to winding down 150mm fabs and consolidating R&D sites, with expected cost reductions in the future [15][16] Question: What are the expectations for gross margins in Q4? - Management indicated that gross margins are expected to decline due to lower revenue and increased depreciation [25][31] Question: How is the company addressing inventory levels? - The company is pleased with its current inventory position and aims to maintain it while ensuring high customer service levels [13][50] Question: What is the outlook for the data center market? - The data center market is growing rapidly, with no signs of slowdown, and the company plans to provide more details in future calls [54][55]

Texas Instruments (NasdaqGS:TXN) Q3 2025 Earnings Call October 21, 2025 04:30 PM ET Speaker0Welcome to the Texas Instruments Third Quarter twenty twenty five Earnings Conference Call. I'm Mike Beckman, Head of Investor Relations, and I'm joined by our Chief Executive Officer, Habib Vollon and our Chief Financial Officer, Rafael Lazardi. For any of you who missed the release, you can find it on our website at ti.com/ir. This call is being broadcast live over the web and can be accessed through our website. I ...