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TXN trades against a final fair-value range of $99.78-$206.88, with the midpoint set by the accepted valuation synthesis rather than earlier draft model outputs.
A prolonged cyclical downturn in industrial and auto markets coincides with peak 300mm fab capital intensity, cratering free cash flowFree cash flowOperating cash flow minus capital expenditures. The cash a business generates after maintaining and growing its asset base — the closest accounting proxy for owner-economics. and forcing a highly disruptive pause in dividend growth.
300mm US fab buildout faces severe delays or structural cost overruns, permanently eroding projected unit cost advantages.
Long-term secular decline or massive inventory digestion in key industrial and automotive end markets nullifies the need for expanded capacity.
Competitors aggressively cut chip prices to gain share, compressing TXN's historical gross margin profile and destroying expected returns on invested capital.
| Line item | 2022-12-31 | 2023-12-31 | 2024-12-31 | 2025-12-31 | Trend |
|---|---|---|---|---|---|
| Revenue | $20.03B | $17.52B-12.5% | $15.64B-10.7% | $17.68B+13.0% | -4.1% |
| Gross profit | $13.77B | $11.02B | $9.09B | $10.08B | -9.9% |
| Operating income | $10.40B | $7.33B | $5.34B | $6.14B | -16.1% |
| Net income | $8.75B | $6.51B-25.6% | $4.80B-26.3% | $5.00B+4.2% | -17.0% |
| EPS (diluted) | $9.41 | $7.07 | $5.20 | $5.45 | -16.6% |
| EBITDA | $11.23B | $9.01B | $7.54B | $8.25B | -9.7% |
| R&D | $1.67B | $1.86B | $1.96B | $2.08B | +7.6% |
| SG&A | $1.70B | $1.83B | $1.79B | $1.86B | +3.0% |
Cash-flow quality is reflected in the OCFOperating cash flowCash generated from the company's core operations after working-capital changes but before capital expenditures. The first line of the cash-flow statement. / net incomeNet IncomeNet Income is an income-statement line item used to reconcile revenue to operating profit, pre-tax income, net income, or per-share earnings. It should be compared across periods and against peer disclosure conventions., accounting-quality, and ROICROICReturn on invested capital. Operating profit (after tax) divided by invested capital. The single best gauge of capital-efficiency. Spread over WACC = economic value created. rows above.
Capital allocation should be evaluated against reinvestment needs, balance-sheet strength, and shareholder returns.
| Deterioration versus the report thesis |
| Dividend payout ratio mathematically exceeding 100% of structurally normalized owner earnings. | Monitor | Deterioration versus the report thesis |
| Core analog revenue growth decelerating below 5% during a confirmed macroeconomic expansionary phase. | Monitor | Deterioration versus the report thesis |
