TXN Financial Analysis

Analysis Date: 1/27/2025

Business Model

Texas Instruments generates revenue primarily through sales of analog and embedded processing semiconductors

Revenue Sources

• Analog segment: $3,174M (79.2% of Q4 2024 revenue)
• Embedded Processing: $613M (15.3% of Q4 2024 revenue)
• Other: $220M (5.5% of Q4 2024 revenue)

Revenue Distribution by Channel

• Primary channels include industrial and automotive markets

Income Statement Analysis

• Revenue decreased 2% year-over-year to $4.01B
• Operating profit declined 10% to $1.38B
• Net income decreased 12% to $1.21B

Balance Sheet Analysis

• Strong balance sheet with $3.2B in cash and cash equivalents
• Total assets increased 9.8% year-over-year
• Long-term debt increased to $12.8B from $10.6B

Cash Flow Analysis

• Generated $6.3B in cash flow from operations for trailing 12 months
• Free cash flow of $1.5B for trailing 12 months
• Capital expenditures of $4.8B for trailing 12 months

Capital Allocation

Over the past 12 months, TI invested $3.8B in R&D and SG&A, $4.8B in capital expenditures, and returned $5.7B to shareholders through dividends ($4.8B) and share repurchases ($929M)

Management Commentary

Cash flow from operations of $6.3B underscores strength of business model

Revenue decreased 3% sequentially and 2% year-over-year

Expect 2025 effective tax rate to be about 12%

Overall Sentiment: Cautiously optimistic with focus on long-term investments and shareholder returns

Recommendation

Rating: Hold

Reason for Rating: Despite near-term revenue weakness, strong cash generation and strategic investments support long-term position

Disclaimer: This analysis is based on company filings and public information. It is for informational purposes only and not financial advice. Past performance does not guarantee future results.

Generated on: 1/27/2025, 1:51:10 PM