Texas Instruments Inc (NASDAQ:TXN) stock gained after Wall Street analysts raised their price targets on the stock after an upbeat quarter.
• Texas Instruments shares are powering higher. What’s behind TXN gains?
Q4 Results Come In Slightly Light, Revenue Still Rises
Texas Instruments delivered fourth-quarter results that came in just under expectations but eased investor concerns with an outlook that signaled steadying demand.
The company generated $4.42 billion in revenue and $1.27 in earnings per share, falling slightly short of analyst forecasts of $4.44 billion and $1.30 per share.
Despite the miss, revenue climbed 10% from a year earlier.
Guidance Helps Calm Demand Concerns
Looking ahead, Texas Instruments projected first-quarter revenue of $4.32 billion to $4.68 billion and earnings of $1.22 to $1.48 per share, compared with consensus estimates of $4.42 billion in revenue and $1.26 per share in earnings.
Cantor Fitzgerald analyst Matthew Prisco maintained Texas Instruments with a Neutral and raised the price target from $190 to $225.
Benchmark analyst Cody Acree reiterated Texas Instruments with a Buy and raised the price target from $220 to $250.
Rosenblatt analyst Kevin Cassidy maintained Texas Instruments with a Buy and raised the price target from $200 to $240.
Analysts Point To Better Momentum In Industrial and Data Center
Cantor Fitzgerald: Prisco said Texas Instruments delivered a much stronger-than-expected quarter, highlighted by its first forecast for positive sequential first-quarter growth since 2010 and better-than-anticipated gross margin trends, even though margins are still expected to dip slightly quarter over quarter from a higher base.
The analyst said management now sees an ongoing recovery supported by improving orders, a growing backlog and elevated "turns" business.
He pointed to data center demand and a broad-based rebound in Industrial as the main bright spots, adding that the first-quarter outlook implies high-single-digit sequential growth in Industrial.
Prisco expects a gradual industry recovery with pockets of secular growth, particularly in data center and advanced driver-assistance electronics.
The analyst added that the broader semiconductor recovery allowed Texas Instruments to guide above normal seasonal patterns, with management sounding more optimistic than three months ago.
Benchmark: Acree said Texas Instruments sparked an after-hours jump of as much as 8% after it ended two quarters of cautious guidance and issued an unusually upbeat March-quarter outlook, including its first forecast for sequential first-quarter growth in more than 20 years.
The analyst said Texas Instruments's commentary improved over the past 90 days as order patterns became more predictable and backlog visibility strengthened through the fourth quarter.
He added that Texas Instruments also grew more "turns" business — orders that ship within the same quarter — and saw the momentum spread across Industrial and Automotive.
Acree noted each segment contributed about 33% of 2025 revenue, with Industrial sales up 12% for the year and Automotive up 6%, even though both dipped sequentially on normal seasonality.
The analyst also pointed to Texas Instruments data center segment as another support, saying it posted seven straight quarters of strong growth and reached about $1.5 billion in 2025 revenue, or roughly 9% of the total.
He said Texas Instruments looks well-positioned for a broader chip-cycle recovery because it leads in multiple analog categories, carries inventory it can use to meet short lead times, and keeps expanding higher-margin 300mm production capacity.
Rosenblatt: Cassidy said Texas Instruments delivered an in-line quarter that included an unanticipated six cent EPS headwind tied to goodwill on legacy products, while its outlook pointed to improving demand.
The analyst noted that Texas Instruments's guidance for roughly 1.5% sequential revenue growth beat consensus expectations, driven primarily by higher order rates from industrial and data center customers.
He views this as evidence that industrial demand is broadening and that data center growth is accelerating.
Cassidy highlighted management's disclosure that data center revenue surged 70% year over year in the fourth quarter of fiscal 2025.
Based on that momentum, the analyst expects the data center business to exceed 12% of total revenue in 2026, up from about 9% in 2025.
He said Texas Instruments is well-positioned as it ramps lower-cost manufacturing capacity and wraps up its accelerated capital spending cycle.
While Analog, Embedded Processing, and Other segments all declined sequentially, Cassidy emphasized that management described a continuing market recovery.
The analyst added that industrial and data center remained the standout end markets.
TXN Price Action: Texas Instruments stock traded higher by 9.25% at $214.87 at publication on Wednesday.
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