TI(US:TXN)2026-01-27 22:32Financial Data and Key Metrics Changes - Q4 revenue was $4.4 billion, a decrease of 7% sequentially but an increase of 10% year-over-year [4] - Gross profit was $2.5 billion, representing 56% of revenue, with a sequential decrease of 150 basis points [9] - Operating profit was $1.5 billion, or 33% of revenue, up 7% from the previous year [9] - Net income for Q4 was $1.2 billion, translating to $1.27 per share, which included a $0.06 reduction due to non-cash impairment and tax-related items [9] Business Line Data and Key Metrics Changes - Analog revenue grew 14% year-over-year, while Embedded Processing grew 8% [4] - The Other segment declined compared to the previous year [4] - Industrial market revenue was $5.8 billion, up 12% year-over-year, accounting for 33% of total revenue [7] - Automotive revenue was also $5.8 billion, up 6% year-over-year, representing another 33% of revenue [7] - Data center revenue reached $1.5 billion, up 64% year-over-year, making up 9% of total revenue [7] - Personal electronics revenue was $3.7 billion, up 7% year-over-year, accounting for 21% of revenue [7] - Communications equipment revenue was approximately $500 million, up about 20% year-over-year, representing 3% of total revenue [7] Market Data and Key Metrics Changes - The industrial market saw high teens growth year-over-year but was down mid-single digits sequentially [5] - The automotive market increased upper single digits year-over-year but was down low single digits sequentially [6] - Data center market grew around 70% year-over-year and mid-single digits sequentially [6] - Personal electronics declined upper teens year-over-year and mid-teens sequentially [6] - Communications equipment declined low single digits year-over-year and mid-teens sequentially [6] Company Strategy and Development Direction - The company reorganized its end markets to include data center, reflecting growth opportunities in analog and embedded products [4] - Strategic emphasis is placed on industrial, automotive, and data center markets, which now account for about 75% of total revenue, up from 43% in 2013 [7] - The company aims to maximize long-term free cash flow per share growth, which is seen as the primary driver of long-term value [12] Management's Comments on Operating Environment and Future Outlook - Management noted a continuing recovery in the semiconductor market and expressed confidence in meeting customer demand with existing inventory and capacity [4] - The outlook for Q1 2026 revenue is expected to be in the range of $4.32 billion to $4.68 billion, with earnings per share projected between $1.22 and $1.48 [13] - Management highlighted the importance of disciplined capital allocation and investment in competitive advantages to sustain growth [13] Other Important Information - Cash flow from operations for Q4 was $2.3 billion, with capital expenditures of $925 million [10] - The company returned $6.5 billion to shareholders over the past 12 months, including a 4% increase in dividends per share [10] - Inventory at the end of the quarter was $4.8 billion, down $25 million from the prior quarter [11] Q&A Session Summary Question: What is driving the above-seasonal Q1 guidance? - Management indicated that the guidance is based on stronger bookings and recovery in the industrial and data center markets, not pricing [16][17][19] Question: How are inventory levels expected to change? - Management expressed satisfaction with current inventory levels, which are seen as an asset to meet customer demand [25][26] Question: What are the prospects for personal electronics and communications markets? - Management noted that while personal electronics grew for the year, Q4 was weaker than expected, with varying performance across sectors [27][28] Question: What is the status of the automotive market? - Management indicated that the automotive market is experiencing secular growth, with expectations for continued strength despite a slight decline in Q4 [60][62] Question: Can you provide details on the data center business growth? - Management highlighted that data center growth is expected to continue, driven by ongoing CapEx investments and a strong position in analog and embedded parts [78][80]