synopsis

The company noted that all but one of its end markets grew sequentially, with personal electronics being the exception due to seasonality.

Texas Instruments, Inc. (TXN) stock rallied strongly in Wednesday's after-hours session after the Dallas, Texas-based company announced a solid quarterly beat and issued a positive outlook.

The company reported earnings per share (EPS) of $1.18 and revenue of $4.07 billion for the first quarter of 2025. It clarified that the bottom-line result included a $0.05-per-share benefit, which was not included in its guidance.

The consensus estimate compiled by Finchat modeled EPS and revenue of $1.10 and $3.91 billion, respectively.

The company's EPS declined from $1.20 a year ago and $1.30 in the previous quarter, while revenue climbed from $3.66 billion in the previous quarter and from $4.01 billion in the prior quarter.

Texas Instruments (TI) produces analog and embedded processing chips for end markets such as industrial, automotive, personal electronic, communication equipment, and enterprises. 

The company noted that all but one of its end markets grew sequentially, with personal electronics being the exception as it experienced a seasonal decline. 

Baird analyst Tristan Gerra said customers might be rebuilding some inventories, driving the sequential rebound, given the lack of visibility due to the evolving tariff situation.

The analyst also noted that TI remains confident that it can cover the vast majority of its China exposure with production outside the U.S.

Baird rates the stock an 'Outperform' with a $175 price target.

The cash flow from operations for the trailing 12-month period was $6.2 billion, and the free cash flow was $1.7 billion.

For the second quarter, TI expects EPS of $1.21 to $1.47 and revenue of $4.17 billion to $4.53 billion, comparing favorably to the consensus of $1.24 and $4.12 billion, respectively.

Commenting on the earnings call, CEO Haviv Illan said the semiconductor cycle is at its lowest point right now, and customer inventories were low across end markets, according to the Koyfin transcript.

He also said the potential impact of evolving geopolitical conditions on the company, its customers, and suppliers is unknown. However, he clarified that, at this time, he does not see a near-term impact on the second quarter.

On Stocktwits, retail sentiment toward TI stock reversed to 'extremely bullish' (94/100) by late Wednesday from 'bearish' a day ago, with the message volume spiking to 'extremely high' levels.

TXN sentiment and message volume as of 1:32 a.m. ET, April 24 | source: Stocktwits

A bullish watcher rooted for a move to $170 by this Friday.

TI stock climbed 4.71% in the after-hours session to $159.31. At Wednesday's close of $152.51, it has lost 18% for the year-to-date period.

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