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FY2026 Q2
Improving
Texas Instruments Incorporated earnings call
Buzzberg read
Data center revenue doubled year-on-year
Texas Instruments reported strong Q2 results with revenue of $5.5B (+13% QoQ, +23% YoY), driven by broad-based growth in industrial, automotive, and data center. Management guided Q3 revenue above seasonal trends at $5.65-6.15B and EPS $2.23-2.57, citing accelerating demand and initial pricing increases. Key cross-company signals included an update on the Silicon Labs acquisition timeline and several supply-chain insights: TI's pricing power is shifting, lead times are rising slightly, and the company has unique capacity agility with clean room space available. Revenue grew 23% YoY, with analog up 26%, embedded processing up 16%, and data center doubling year-over-year.
Buzzberg read Data center revenue doubled year-on-year Texas Instruments reported strong Q2 results with revenue of $5.5B (+13% QoQ, +23% YoY), driven by broad-based growth in industrial, automotive, and data center. Management guided Q3 revenue above seasonal trends at $5.65-6.15B and EPS $2.23-2.57, citing accelerating demand and initial pricing increases. Key cross-company signals included an update on the Silicon Labs acquisition timeline and several supply-chain insights: TI's pricing power is shifting, lead times are rising slightly, and the company has unique capacity agility with clean room space available. Revenue grew 23% YoY, with analog up 26%, embedded processing up 16%, and data center doubling year-over-year. Read full analysisCollapse analysis
Texas Instruments reported strong Q2 results with revenue of $5.5B (+13% QoQ, +23% YoY), driven by broad-based growth in industrial, automotive, and data center. Management guided Q3 revenue above seasonal trends at $5.65-6.15B and EPS $2.23-2.57, citing accelerating demand and initial pricing increases. Key cross-company signals included an update on the Silicon Labs acquisition timeline and several supply-chain insights: TI's pricing power is shifting, lead times are rising slightly, and the company has unique capacity agility with clean room space available. Revenue grew 23% YoY, with analog up 26%, embedded processing up 16%, and data center doubling year-over-year.
- Q3 revenue guide of $5.65-6.15B implies above-seasonal growth, with strength across industrial, automotive, and personal electronics.
- TI has begun executing price increases, which will phase in over Q3 and Q4, marking a shift from typical flat-to-down annual pricing.
- Lead times are increasing by a couple of weeks due to demand, but remain the most competitive in the market, providing a share-gain opportunity.
Revenue$5.463B+13% QoQ
EPS$2.14+27% QoQ
Gross margin61.36%Reported
Operating margin42.28%Reported
5 grounded callouts
What matters now
The highest-signal changes from the call.
Margins
Pricing increases have started executing
Capex
2026 capex could be higher end of $2-3B
Show 2 more callouts
Capital return
Free cash flow surged to $6.5B
Demand
Industrial revenue grew 30% year-on-year
Reported period
Actuals
| Metric | Reported | Change |
|---|---|---|
| Revenue | $5.463B | +13% QoQ |
| EPS | $2.14 | +27% QoQ |
| Gross margin | 61.36% | Reported |
| Operating margin | 42.28% | Reported |
| Free cash flow | $2.189B | Reported |
| Capex | $0.514B | Reported |
Forward-looking
Forward guidance
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| EPS | FY2026 Q3 | $2.23–$2.57 | $2.40 | Guided |
| Revenue | FY2026 Q3 | $5.65B–$6.15B | $5.9B | Guided |
AI, capex & demand read
Management read
confident
Management expressed strong confidence in broad demand across all markets, with above-seasonal guidance and pricing increases, and no notable shift from their prior upbeat stance.
Investment and capacity
Capital expenditures were $514 million in Q2 and $3.3 billion over the last 12 months. Management reiterated 2026 capex guidance of $2-3 billion, noting it could be on the higher end due to demand, and they have clean room space available to equip and ramp.
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Companiesreturns since call
Supply chain
Supply chain
Julie Knecht
Texas Instruments' acquisition of Silicon Labs assets (likely infrastructure/automotive business) is on schedule, with no change to financing plans.
Evidence
“regulatory approvals are moving as planned. We still expect to close in the first half of next year.”
Supply chain
Haviv Ilan
TI has 'clean room space available' that can be equipped and ramped quickly, giving it unique capacity agility compared to competitors facing multi-year fab construction timelines. — TI can capitalize on demand spikes faster than peers, potentially winning share in tight supply environments without the long lead time for new fab construction.
Evidence
“Even with a nice growth in Q2, we have to go back to 2022. And we are still lower than that peak, maybe five or six points lower than that 2022 peak.”
External signals
Supply-chain alpha · 5returns since call
TI has begun executing price increases, a shift from typical flat-to-down annual pricing, with initial effects in Q3 and continuing into Q4 and possibly 2027.
Evidence
“we have started executing price increases, yes. And because we go to the market direct, we have the discussion... Some of it will start to play in in Q3, but I expect that to continue into the fourth quarter.”
Lead times are increasing slightly (a couple weeks higher) as demand grows, but TI's lead times remain the most competitive in the market.
Evidence
“lead times are still, I think, very competitive, but they will be low... we are seeing a little bit of an uptick there, not dramatic, maybe a couple of weeks higher, simply because the demand is growing.”
Industrial revenue is still 5-6% below the 2022 peak, implying significant room for further recovery beyond the current strong growth.
Data center revenue doubled year-on-year and management sees additional tailwinds from the 800V architecture transition, which adds conversion stages and increases TAM for analog and embedded parts.
Evidence
“future architectures like 800 volts... that just means higher growth of the TAM, more conversion stages and that helps our market on the analog and embedded side.”
TI has 'clean room space available' that can be equipped and ramped quickly, giving it unique capacity agility compared to competitors facing multi-year fab construction timelines.
Evidence
“we have the clean room... a full clean room available almost in Sherman 1. Not to mention a shell, a second shell in Sherman 2.”
Methodology & coverage
Management-only analysis. All 3 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.