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 ...

Financial Data and Key Metrics Changes - In Q3 2025, revenue grew 23% to $2.5 billion, with pro forma operating margin at 39% and pro forma earnings per share increasing by 30% [19][32][36] - Pro forma gross margin for the quarter was 68%, down from 69.1% in Q3 of the previous year, attributed to tariffs and a greater mix of lower-margin revenue [33] - Pro forma net income for Q3 was $867 million, compared to $669 million last year, with pro forma earnings per share at $2.40 [36][37] Business Line Data and Key Metrics Changes - Total procedure growth was 20%, with da Vinci procedures increasing by 19% and ION procedures by 52% [19][20][7] - The installed base of da Vinci systems increased by 13% to nearly 10,800 systems, while average system utilization grew by 4% [20][21] - ION platform saw a 52% increase in procedures, with the installed base up by 30% to approximately 950 systems [20][21] Market Data and Key Metrics Changes - In the U.S., total procedures increased by 18%, with da Vinci procedures growing by 16% and ION procedures by 48% [21][23] - Outside the U.S., total procedures grew by 25%, driven by strong results in India, Canada, Korea, Taiwan, and Brazil [23][24] - Average system utilization in international markets grew by 8% in Q3, reflecting strong multi-specialty procedure growth [24] Company Strategy and Development Direction - The company aims to focus on the full launch of da Vinci V, increasing adoption of focused procedures, and driving progress in product quality and manufacturing optimization [16] - Plans to offer refurbished Xi systems as part of a broader portfolio to expand access in certain geographies [9] - The company is committed to enhancing digital tools and integrating AI and machine learning into surgical processes [96] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand for da Vinci V and the potential for increased utilization as more systems are adopted [6][19] - The company updated its 2025 guidance for da Vinci procedure growth to a range of 17% to 17.5% [44] - Management acknowledged challenges in the bariatric market and competitive pressures in China but remains focused on navigating these dynamics [88][89] Other Important Information - The company placed 427 da Vinci systems in Q3, a 13% increase from the previous year, with 240 being da Vinci V systems [26][28] - Service revenue increased by 20% to $396 million, reflecting a 13% increase in the da Vinci installed base [32] - The company ended the quarter with $8.4 billion in cash and investments, down from $9.5 billion last quarter, primarily due to share repurchases [37] Q&A Session Summary Question: Trends driving procedure volume growth and sustainability - Management noted strong growth in U.S. da Vinci procedures, with Q3 growth at 16%, driven by benign general surgery and elective procedures [50][51] Question: Refurbished Xi systems and market potential - Management highlighted the importance of refurbished Xi systems for cost-sensitive customers and noted that 20 refurbished XIs have been sold so far [59][60] Question: Utilization of da Vinci systems in ASCs - Management indicated that capital costs are a greater constraint than sterilization challenges for ASCs, with a focus on increasing interest in the ASC market [102][104] Question: Impact of haptics and force feedback technology - Management discussed the potential of da Vinci V to make robotic surgery more ubiquitous, particularly in benign general surgery [107]

Manhattan Associates (NasdaqGS:MANH) Q3 2025 Earnings Call October 21, 2025 04:30 PM ET Speaker0Good afternoon. My name is Vaughn, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Manhattan Associates Quarter Three twenty twenty five Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer period.As a reminder, ladies and gentlemen, this call is being re ...

Financial Data and Key Metrics Changes - In Q3 2025, revenue grew 23% to $2.5 billion, with pro forma operating margin at 39% and pro forma earnings per share increasing by 30% [14][24][25] - Total procedure growth was 20%, with Da Vinci procedures increasing by 19% and Ion procedures by 52% [14][15][18] - Pro forma gross margin for the quarter was 68%, down from 69.1% in Q3 of the previous year [23][24] Business Line Data and Key Metrics Changes - Da Vinci system placements totaled 427, including 240 Da Vinci 5 systems, reflecting strong domestic demand for upgrades [5][14][19] - Ion platform procedures grew 52%, with the installed base increasing by 30% to approximately 950 systems [15][18] - Average system utilization for Da Vinci multiport platforms grew by 4%, while Ion utilization increased by 14% [5][15] Market Data and Key Metrics Changes - In the U.S., total procedures increased by 18%, with Da Vinci procedures growing by 16% and Ion procedures by 48% [15][16] - Internationally, total procedures grew by 25%, driven by strong results in India, Canada, Korea, Taiwan, and Brazil [16][17] - Da Vinci procedure growth in OUS markets included strong results in benign general surgery, colorectal, and hysterectomy procedures [17] Company Strategy and Development Direction - The company aims to focus on the full launch of Da Vinci 5, increasing adoption of focused procedures, and enhancing product quality and manufacturing optimization [12][31] - Plans to offer refurbished Xi systems to expand access in certain geographies and sites of care [6][40] - The company is committed to leveraging digital tools and AI to enhance surgical outcomes and operational efficiency [9][72] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth in procedure volumes and the positive impact of Da Vinci 5 on utilization rates [4][37] - The company is navigating challenges in markets like Japan and China, where government budget constraints and competition are significant [20][67] - Updated guidance for 2025 includes an increase in expected Da Vinci procedure growth to a range of 17% to 17.5% [31] Other Important Information - The company ended the quarter with $8.4 billion in cash and investments, down from $9.5 billion, primarily due to share repurchases [26] - The company received FDA clearance for significant software updates for Da Vinci 5, enhancing its capabilities [9][11] Q&A Session Summary Question: What trends are driving the 20% procedure volume growth? - Management noted strong growth in benign general surgery and elective procedures, with Da Vinci 5 adoption contributing significantly [34][35] Question: How is the refurbished Xi strategy progressing? - The company has sold 20 refurbished Xi systems and sees potential for growth in cost-sensitive markets [40][42] Question: What is the outlook for bariatric procedures and the China market? - Bariatric procedures continue to decline, and the company is navigating a competitive environment in China with price pressures [66][67] Question: How is the Intuitive Hub contributing to Da Vinci uptake? - The Intuitive Hub is integral to collecting data and enhancing surgical insights, which is expected to improve outcomes [68][72]

Financial Data and Key Metrics Changes - Net income for the third quarter totaled $10.1 million or $0.59 per share, representing a 9% increase from the previous quarter and a 45% increase year-over-year [3][5] - Net interest income increased for the fifth consecutive quarter, rising by $1.9 million to $29.3 million, driven by higher interest income of $3.2 million [6][8] - Net interest margin expanded by six basis points to 2.98%, marking a 30 basis point increase over the last four quarters [3][7] Business Line Data and Key Metrics Changes - Loans held for investment grew by $68 million or 8% on an annualized basis, primarily from the in-house mortgage origination business [4] - Third quarter loan originations totaled $188 million at a blended yield of 6.70%, which is 67 basis points above the prior quarter's blended loan portfolio yield [4][9] - Non-performing loans decreased by $11.3 million or 20% to $44.5 million, attributed to charge-offs and upgrades [9][10] Market Data and Key Metrics Changes - Total deposits increased by $178 million from the end of the second quarter to $3.4 billion, with growth across all deposit categories [11] - The allowance for loan losses to total loans held for investment ratio stood at 1.36% as of September 30, indicating appropriate risk coverage [11] Company Strategy and Development Direction - The company is focused on addressing remaining credit issues and improving asset quality, with a goal of resolving significant non-accrual loans [20][21] - There is an ongoing effort to shift the loan portfolio mix towards commercial and industrial (C&I) loans while maintaining strong growth in residential mortgages [34][36] - The company is considering opportunities for share buybacks and refinancing sub-debt, while also investing in business growth and technology [55] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about core earnings growth and lower credit costs, viewing these as positive signs for the future [3] - The competitive landscape for liquidity remains challenging, impacting the ability to reduce funding costs significantly [7][30] - The company anticipates continued loan growth, although Q4 may see some seasonal moderation [34] Other Important Information - The tangible book value per share increased to $25.89, reflecting a 12% annualized increase [11] - The company repurchased 660,000 shares, or 4% of shares outstanding, during the third quarter [11] Q&A Session Summary Question: Asset quality improvement metrics - Management acknowledged progress in asset quality but indicated that more work is needed, particularly in resolving non-accrual loans [18][19] Question: Capital and share repurchase authorization - Approximately $4 million remains in the current share repurchase program, with management open to future buybacks depending on stock price and market conditions [22][23] Question: Deposit beta and interest rates - Management noted that deposit beta has slowed due to fierce competition for liquidity, and they expect to capitalize on upcoming maturing time deposits [28][30] Question: Loan growth and portfolio mix - The pipeline remains healthy, with a focus on residential mortgages and a gradual shift towards C&I loans, although government shutdowns may impact SBA loan funding [35][36] Question: Interest recovery and FHLB advances - No significant interest recovery was noted in Q3, and FHLB advances were replaced with brokered deposits at higher rates [42][43]

Financial Data and Key Metrics Changes - Net income for the third quarter totaled $10.1 million or $0.59 per share, representing a 9% increase from the previous quarter and a 45% increase year-over-year [3][5] - Net interest income increased for the fifth consecutive quarter, rising by $1.9 million to $29.3 million, driven by higher interest income of $3.2 million [6][8] - Net interest margin expanded by six basis points to 2.98%, marking a 30 basis point increase over the last four quarters [3][7] Business Line Data and Key Metrics Changes - Loans held for investment grew by $68 million or 8% on an annualized basis, primarily from the in-house mortgage origination business [4] - Third quarter loan originations totaled $188 million at a blended yield of 6.70%, which is 67 basis points above the prior quarter's blended loan portfolio yield [4][9] - Non-performing loans decreased by $11.3 million or 20% to $44.5 million, attributed to charge-offs and upgrades [9][10] Market Data and Key Metrics Changes - Total deposits increased by $178 million from the end of the second quarter to $3.4 billion, with growth across all deposit categories [11] - The allowance for loan losses to total loans held for investment ratio stood at 1.36% as of September 30, indicating appropriate risk coverage [11] Company Strategy and Development Direction - The company is focused on addressing remaining credit issues and improving asset quality, with a goal of resolving significant non-accrual loans [20][21] - There is an ongoing effort to deepen relationships in existing markets and explore opportunities for sub-debt refinancing next year [55] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding core earnings growth and lower credit costs, viewing these as positive signs for the future [3] - The company remains vigilant in addressing credit issues and is focused on maintaining loan growth while managing operating costs [20][21] Other Important Information - The tangible book value per share increased to $25.89, reflecting a 12% annualized increase [11] - The company repurchased 660,000 shares, or 4% of shares outstanding, during the third quarter [11] Q&A Session Summary Question: Asset quality improvement and future expectations - Management acknowledged progress in asset quality but indicated that more work is needed, with a focus on resolving significant non-accrual loans [18][20] Question: Capital and share repurchase authorization - The company has about $4 million left in the current share repurchase program and is considering future buyback opportunities [22][23] Question: Deposit beta and interest rates - Management noted that deposit beta has slowed due to fierce competition for liquidity, and they expect to capitalize on upcoming rate cuts [28][30] Question: Loan growth and portfolio mix - The pipeline remains healthy, with a focus on residential mortgage and commercial loans, although seasonality may moderate growth in Q4 [34][35] Question: Interest recovery and FHLB advances - There was no significant interest recovery in Q3, and FHLB advances were replaced with brokered deposits at a higher rate [42][43] Question: Margin expansion and future rate cuts - Management believes they can continue to expand margins despite potential rate cuts, driven by loan growth and origination yields [48][50]

Financial Data and Key Metrics Changes - Third quarter net income totaled $10,100,000 or $0.59 per share, representing a 9% increase from the previous quarter and a 45% increase year-over-year [3][5] - Net interest margin increased by six basis points to 2.98% compared to the prior quarter, and has increased by 30 basis points over the last four quarters [4][6] - Net interest income rose for the fifth consecutive quarter, up $1,900,000 to $29,300,000, driven by higher interest income [6][11] Business Line Data and Key Metrics Changes - Loans held for investment grew by $68,000,000 or 8% on an annualized basis, with significant growth from the in-house mortgage origination business [4][6] - Third quarter loan originations totaled $188,000,000 at a blended yield of 6.7%, which is 67 basis points above the prior quarter's blended loan portfolio yield [4][8] - Nonperforming loans decreased by $11,300,000 or 20% to $44,500,000, indicating improved asset quality [9][10] Market Data and Key Metrics Changes - Total deposits increased by $178,000,000 to $3,400,000,000, with growth across all deposit categories [11] - The average loan portfolio yield expanded by nine basis points to 6.12% due to strong origination yields and repricing of loans [8] Company Strategy and Development Direction - The company is focused on addressing nonperforming loans while minimizing the impact on earnings and capital [4][10] - There is an ongoing effort to manage operating costs to be below 2% of average assets while maintaining loan growth [7][11] - The company is considering opportunities for share buybacks and refinancing of subordinated debt in the future [21][53] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about core earnings growth and lower credit costs, viewing these as positive signs for the future [3][6] - The company remains vigilant in addressing remaining credit issues and is focused on improving asset quality [16][18] - Management indicated that competition for liquidity remains stiff, impacting the ability to reduce funding costs significantly [6][28] Other Important Information - The allowance for loan losses to total loans held for investment ratio stood at 1.36% as of September 30, which management believes appropriately addresses the risk in the loan portfolio [10] - The tangible book value per share increased to $25.89, reflecting a 12% annualized increase [11] Q&A Session Summary Question: What inning do you think you're in regarding credit resolution? - Management acknowledged that while progress has been made, there is still work to do and they are focused on resolving remaining credit issues [16][18] Question: How much is left in the current share repurchase authorization? - Approximately $4,000,000 remains in the current program, and management is considering future buyback opportunities [21][22] Question: What is the expected deposit beta with potential rate cuts? - Management indicated that deposit beta has slowed due to fierce competition for liquidity, and they expect to capitalize on maturing time deposits [25][28] Question: Was there any interest recovery during the third quarter? - Management confirmed that there were no significant anomalies in net interest income related to interest recovery during the quarter [38] Question: What rates were the FHLB advances maturing at? - The FHLB advances matured at a rate of approximately 3.40%, and were replaced with brokered deposits at rates closer to 4% [40][41]

Financial Data and Key Metrics Changes - The company reported a record earnings per share of $2.84 for Q3 2025, with net income of $35.9 million, showing significant improvement compared to previous quarters [4] - Non-performing loans decreased from $52 million to $17 million, primarily due to the foreclosure of a $37 million loan, which was subsequently sold for a gain [4] - Loan growth was 2.3% ($133 million) and deposit growth was 2.5% ($151 million) during the quarter [5] - The efficiency ratio improved to less than 30%, with stable operating overhead compared to previous quarters [5][6] Business Line Data and Key Metrics Changes - The company experienced reasonable loan and deposit growth, indicating increased optimism among customers despite ongoing economic uncertainties [5] - The net interest income and net interest margin both improved in Q3 compared to previous quarters [5] Market Data and Key Metrics Changes - Approximately 29% of the loan portfolio is fixed rate or long adjustable, while 71% is floating rate, with 98% of the floating rate loans having floors [12] - The average margin for September was reported at 3.87%, with a cost of deposits at 3.36% [24] Company Strategy and Development Direction - The company aims to maintain loan growth in Q4 2025, hoping to match Q3 levels, while also managing interest rate sensitivity through a balanced loan portfolio [35][55] - There is a strategic focus on increasing demand deposits, which are becoming harder to acquire due to competitive pressures [39] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about loan growth in Q4, influenced by potential interest rate cuts and seasonal factors [35] - The company is closely monitoring credit quality and expects to see reasonable migration in criticized and classified loans [27][29] Other Important Information - The company repurchased $6.3 million of its own shares during the quarter and continued to buy back shares in October, totaling 128,000 shares for $11.2 million [6][17] - An error in calculating diluted earnings per share for the first half of 2025 was corrected, resulting in an underreporting of net income by $0.05 [6] Q&A Session Summary Question: Update on loan portfolio's floating rate component - Approximately 71% of the loan portfolio is floating rate, with 98% having floors, but many are not currently in the money [12] Question: Price sensitivity around the buyback - The buyback strategy is assessed based on income levels and share prices, with no set formula [13] Question: Average margin and cost of deposits - The margin for September was 3.87%, and the cost of deposits was 3.36% [24] Question: Expectations for loan growth and pipelines - The company expects loan growth to remain stable, with a positive outlook for Q4 based on current activity levels [35] Question: Near-term expense run rate expectations - Non-interest expenses are expected to be around $22 million to $22.5 million going forward [37] Question: Specific dollar estimate of expected OREO gain in Q4 - The expected OREO gain in Q4 is projected to be in the $3 to $4 million range [41] Question: Competitive dynamics and loan demand - The company is seeing more deals coming through the pipeline, with optimism from borrowers due to rate cuts [50][51] Question: Actions to manage asset sensitivity - The company continues to proactively manage interest rate sensitivity, adjusting the loan portfolio as needed [55]

Financial Data and Key Metrics Changes - The company reported a record earnings per share of $2.84 for Q3 2025, with net income of $35.9 million, showing significant improvement compared to previous quarters [5][6] - Nonperforming loans decreased from $52 million to $17 million, primarily due to the foreclosure of a $37 million loan, which has since been sold for a gain [6][7] - Loan growth was 2.3% or $133 million, while deposit growth was 2.5% or $151 million, indicating a positive trend in customer optimism despite economic uncertainties [7][8] - The efficiency ratio improved to less than 30% due to increased net interest income, with operating overhead remaining steady [8] Business Line Data and Key Metrics Changes - The company experienced reasonable loan and deposit growth, with a focus on maintaining credit quality metrics stable [7][8] - The loan portfolio composition shifted, with 29% being fixed or long adjustable rates and 71% floating rates, of which 98% have floors [15] Market Data and Key Metrics Changes - The average margin for September was reported at 3.87%, with the cost of deposits at 3.36% [26] - The company has about $1.27 billion of CDs maturing at an average rate of 4.1% in Q4, with new CDs coming in at mid to high 3% [28] Company Strategy and Development Direction - The company aims to increase demand deposits while managing the cost of non-interest-bearing accounts strategically [40][42] - There is a focus on proactive interest rate management, with a significant reduction in floating rate loans from 90% to nearly 70% over the past year and a half [59] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about loan growth in Q4, expecting it to be similar to Q3, influenced by recent interest rate cuts [35][36] - The company anticipates a continued trend of refinancing as borrowers seek to lower their interest burdens, which may lead to increased payoffs [56] Other Important Information - The company repurchased $6.3 million of its own shares during the quarter, with additional repurchases of 128,000 shares in October for $11.2 million [8][19] - An error in calculating diluted earnings per share for the first half of 2025 was acknowledged, resulting in an underreporting of net income by $5 million, which has been corrected in the current report [9] Q&A Session Summary Question: Update on loan portfolio's floating rate component - As of September 30, 71% of the loan portfolio is floating rate, with 98% having floors, but many are not currently in the money [15] Question: Price sensitivity around the buyback - The buyback strategy is measured against income levels and share prices, with no set formula for the amount [17] Question: Average margin and cost of deposits - The margin for September was 3.87%, and the cost of deposits was 3.36% [26] Question: Expectations for near-term expense run rate - Non-interest expense is expected to be around 22% to 22.5% going forward, with increases anticipated in 2026 [38] Question: Insights on deposit composition and flows - There is a strategic focus on increasing non-interest-bearing demand deposits, but competition for these deposits is increasing [40][42] Question: Expected OREO gain in Q4 - The expected OREO gain is projected to be in the range of $3 million to $4 million [43]

Financial Data and Key Metrics Changes - Third quarter net income totaled $10.1 million or $0.59 per share, representing a 9% increase from the previous quarter and a 45% increase year-over-year [3][5] - Net interest income increased for the fifth consecutive quarter, up $1.9 million to $29.3 million, driven by higher interest income of $3.2 million [5][6] - Net interest margin expanded by 6 basis points to 2.98%, a 30 basis point increase over the last four quarters [3][6] Business Line Data and Key Metrics Changes - Loans held for investment grew by $68 million or 8% on an annualized basis, with third quarter loan originations totaling $188 million at a blended yield of 6.70% [4][5] - Non-performing loans decreased by $11.3 million or 20% to $44.5 million, attributed to charge-offs and upgrades [9][10] - Total deposits increased by $178 million to $3.4 billion, with growth across all deposit categories [11] Market Data and Key Metrics Changes - The spot rate on deposits was 2.97%, which was six basis points below the third quarter's average of 3.03% [6] - The loan portfolio yield expanded by 9 basis points to 6.12%, primarily due to strong origination yields [9] Company Strategy and Development Direction - The company is focused on addressing remaining credit issues and improving asset quality, with a goal of resolving significant non-accrual loans [18][19] - There is an ongoing effort to deepen relationships in existing markets and explore opportunities for sub-debt refinancing next year [54] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about core earnings growth and lower credit costs, indicating a positive outlook for the future [3][5] - The company remains vigilant in managing credit quality and is focused on maintaining strong loan growth despite competitive pressures [18][19] Other Important Information - The company repurchased 660,000 shares or 4% of shares outstanding in the third quarter, with a tangible book value per share increasing to $25.89 [11][12] - Non-interest expenses decreased by $1.8 million to $18.7 million, primarily due to the absence of ERC-related expenses from the previous quarter [8] Q&A Session Summary Question: What inning do you think you are in regarding credit resolution? - Management acknowledged that while progress has been made, there is still work to do, and they are focused on resolving remaining credit issues [16][17] Question: How much is left in the current share repurchase authorization? - Approximately $4 million remains in the current program, and management is considering future buyback opportunities [20] Question: What is the expected deposit beta with potential rate cuts? - Management indicated that deposit beta may have slowed due to fierce competition for liquidity, but they expect to capitalize on upcoming opportunities [26][27] Question: What is the outlook for loan growth and portfolio mix? - The pipeline remains healthy, with a focus on residential mortgages and a gradual shift towards C&I loans, although seasonality may moderate growth in Q4 [36][37] Question: Was there any interest recovery during the third quarter? - There was no significant interest recovery or anomalies in net interest income during the third quarter [42] Question: What rates were the FHLB advances maturing at? - The FHLB advances matured at a rate of 3.40%, and were replaced with brokered deposits at higher rates [44]