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Texas Instruments' Q2 earnings rose 52% and revenues climbed 23%, topping estimates.
Analog revenues grew 26% to $4.37 billion, reflecting stronger demand across key end markets.
TXN expects Q3 revenues of $5.65-$6.15 billion and earnings of $2.23-$2.57 per share.
Texas Instruments (TXN - Free Report) reported second-quarter 2026 earnings of $2.14 per share, which increased 52% year over year. The bottom line beat the Zacks Consensus Estimate by 12%.
TXN’s earnings surpassed the Zacks Consensus Estimate thrice in the trailing four quarters, while missing once, with an average surprise of 8.3%.
TXN posted revenues of $5.46 billion, which rose 23% from the year-ago quarter. The top line surpassed the consensus mark by 4.6%, driven by strength in industrial, data center and automotive markets.
Texas Instruments Incorporated Price, Consensus and EPS Surprise
Texas Instruments’ second-quarter results reflected strength across its two core operating segments.
Analog revenues came in at $4.37 billion (79.9% of total revenues), which grew 26% from the year-ago quarter, underscoring improving demand conditions across key end markets. The figure came above our model estimate of $4.08 billion.
Embedded Processing revenues totaled $788 million (14.4% of total revenues), reflecting 16.1% year-over-year growth. The figure missed our model estimate of $799.1 million.
The Other segment generated $310 million of revenues (5.7% of total revenues), which declined 2.2% from the prior-year period. The figure missed our model estimate of $328.5 million.
Texas Instruments Expands Operating Leverage
Texas Instruments’ gross profit increased 30% year over year to $3.35 billion. Gross margin of 61.4% expanded 350 basis points (bps) year over year.
Selling, general and administrative (SG&A) expenses increased 1% year over year to $490 million. As a percentage of revenues, SG&A expenses contracted 190 bps year over year to 9%.
Research and development expenses increased 1.5% year over year to $535 million. As a percentage of revenues, it decreased 210 bps year over year to 9.8%.
Operating profit rose 47.8% year over year to $2.31 billion. The operating margin was 42.3%, which expanded 710 bps from the prior-year quarter’s number.
TXN Cash Generation Supports Shareholder Returns
As of June 30, 2026, the cash and short-term investment balance was $7 billion, up from $5.1 billion as of March 31, 2026.
At the end of the reported quarter, TXN’s long-term debt was $12.903 billion compared with $12.901 billion in the previous quarter.
Texas Instruments generated an operating cash flow of approximately $2.7 billion in the second quarter. During the second quarter, it repurchased stocks worth $27 million and paid $1.295 billion in dividends.
Texas Instruments Initiates Guidance for Q3 2026
Management’s outlook calls for third-quarter 2026 revenues in the range of $5.65-$6.15 billion. The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $5.44 billion, indicating an increase of 14.7% from the year-ago quarter.
The company expects an effective tax rate of about 13% in the third quarter.
The company expects earnings per share between $2.23 and $2.57. The consensus mark for the same is pegged at $2.08 per share, indicating an increase of 40.5% from the year-ago quarter.
Shares of Analog Devices have rallied 69.6% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, down by a penny over the past seven days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 196.2% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by a penny over the past seven days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 63.6% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
View the Zacks #1 Rank List
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Texas Instruments Q2 Earnings Beat Estimates, Revenues Rise Y/Y
Key Takeaways
Texas Instruments (TXN - Free Report) reported second-quarter 2026 earnings of $2.14 per share, which increased 52% year over year. The bottom line beat the Zacks Consensus Estimate by 12%.
TXN’s earnings surpassed the Zacks Consensus Estimate thrice in the trailing four quarters, while missing once, with an average surprise of 8.3%.
TXN posted revenues of $5.46 billion, which rose 23% from the year-ago quarter. The top line surpassed the consensus mark by 4.6%, driven by strength in industrial, data center and automotive markets.
Texas Instruments Incorporated Price, Consensus and EPS Surprise
Texas Instruments Incorporated price-consensus-eps-surprise-chart | Texas Instruments Incorporated Quote
TXN’s Segment Mix Highlights Broad-Based Growth
Texas Instruments’ second-quarter results reflected strength across its two core operating segments.
Analog revenues came in at $4.37 billion (79.9% of total revenues), which grew 26% from the year-ago quarter, underscoring improving demand conditions across key end markets. The figure came above our model estimate of $4.08 billion.
Embedded Processing revenues totaled $788 million (14.4% of total revenues), reflecting 16.1% year-over-year growth. The figure missed our model estimate of $799.1 million.
The Other segment generated $310 million of revenues (5.7% of total revenues), which declined 2.2% from the prior-year period. The figure missed our model estimate of $328.5 million.
Texas Instruments Expands Operating Leverage
Texas Instruments’ gross profit increased 30% year over year to $3.35 billion. Gross margin of 61.4% expanded 350 basis points (bps) year over year.
Selling, general and administrative (SG&A) expenses increased 1% year over year to $490 million. As a percentage of revenues, SG&A expenses contracted 190 bps year over year to 9%.
Research and development expenses increased 1.5% year over year to $535 million. As a percentage of revenues, it decreased 210 bps year over year to 9.8%.
Operating profit rose 47.8% year over year to $2.31 billion. The operating margin was 42.3%, which expanded 710 bps from the prior-year quarter’s number.
TXN Cash Generation Supports Shareholder Returns
As of June 30, 2026, the cash and short-term investment balance was $7 billion, up from $5.1 billion as of March 31, 2026.
At the end of the reported quarter, TXN’s long-term debt was $12.903 billion compared with $12.901 billion in the previous quarter.
Texas Instruments generated an operating cash flow of approximately $2.7 billion in the second quarter. During the second quarter, it repurchased stocks worth $27 million and paid $1.295 billion in dividends.
Texas Instruments Initiates Guidance for Q3 2026
Management’s outlook calls for third-quarter 2026 revenues in the range of $5.65-$6.15 billion. The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $5.44 billion, indicating an increase of 14.7% from the year-ago quarter.
The company expects an effective tax rate of about 13% in the third quarter.
The company expects earnings per share between $2.23 and $2.57. The consensus mark for the same is pegged at $2.08 per share, indicating an increase of 40.5% from the year-ago quarter.
Zacks Rank and Other Stocks to Consider
Currently, TXN carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices (ADI - Free Report) , Applied Materials (AMAT - Free Report) and Cisco Systems (CSCO - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 69.6% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, down by a penny over the past seven days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 196.2% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by a penny over the past seven days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 63.6% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.