Texas Instruments Reports Q4 Results Amid Revenue Challenges

Texas Instruments unveils Q4 2024 results. EPS of $1.30 surpasses expectations, yet revenues decline by 1.7%. Despite challenges, the company shows resilience in segments, and investor focus on future revenue guidance could affect stock performance.

Date: 24-01-2025

AI Rating: 5

Earnings Per Share (EPS)
Texas Instruments reported an EPS of $1.30, exceeding analyst expectations of $1.21. This positive surprise indicates strong earnings performance relative to market expectations.

Revenue Growth
The company posted revenue of $4.01 billion, surpassing the anticipated $3.88 billion. However, there is a notable year-over-year revenue decline of 1.7%, indicating challenges in maintaining growth.

Net Income
Net income for the quarter was reported at $1.21 billion, down 12.1% from $1.37 billion in the previous year. This decline may concern investors about profitability trends.

Profit Margins
Operating profit decreased by 10.2% year-over-year, which suggests heightened pressure on profit margins in a competitive environment. This trend could influence investor sentiment negatively.

Free Cash Flow (FCF)
The free cash flow amounted to $806 million, representing a significant decline of 40.3% year-over-year, raising flags about cash generation capabilities.

Future Guidance
Texas Instruments provided a revenue outlook for Q1 2025 between $3.74 billion and $4.06 billion, alongside an EPS estimate of $0.94 to $1.16. This projection depicts an expected softening in market conditions, particularly in the Embedded Processing segment, which is anticipated to weigh on stock sentiment.

Overall, while the positive EPS and revenue beat are encouraging, the year-over-year declines in revenue, income, and free cash flow, coupled with operational challenges, present a mixed outlook for Texas Instruments. Investors should closely monitor the strategic actions TI is taking to address these challenges as they could significantly impact stock performance moving forward.

Stocks: TXN