TI Q4 Data Center Revenue Soars 70%, Shares Jump 8%

Texas Instruments (TI) released its fourth-quarter 2025 financial results after U.S. markets closed on January 27. While total revenue slightly missed analyst expectations, data center-related sales surged 70%, and the company's guidance for Q1 2026 exceeded market forecasts, sending its shares up more than 8% in after-hours trading.

For Q4 2025, TI posted revenue of $4.42 billion, up 10% year-over-year but down 7% sequentially, just shy of the $4.44 billion analysts had anticipated. The dip was mainly due to weaker demand in smartphones, PCs, and tablets. Net profit fell 3% YoY to $1.16 billion, while earnings per share decreased from $1.30 to $1.27, a 2% decline.

To highlight the impact of artificial intelligence (AI), TI separately reported data center revenue. CEO Haviv Ilan noted that Q4 data center revenue jumped 70% year-over-year, and for the full year, data center sales accounted for about 9% of total revenue. This demonstrates that AI-driven data center demand has become a key growth engine for the company.

For the full year 2025, TI recorded revenue of $17.682 billion, up 13% from 2024, with net profit rising 4.25% to $5 billion and earnings per share growing 4.8% to $5.45. Operating cash flow reached $7.2 billion, highlighting the strength of TI's business model, high-quality product portfolio, and the advantages of its 300mm wafer production. Free cash flow totaled $2.9 billion. The company invested $3.9 billion in R&D and SG&A and $4.6 billion in capital expenditures, returning $6.5 billion to shareholders.

Looking ahead to Q1 2026, TI expects continued growth in AI data center demand to drive revenue between $4.32 billion and $4.68 billion, above Wall Street's consensus of $4.42 billion. Earnings per share are projected at $1.22–$1.48, also exceeding the analyst estimate of $1.26.

After a challenging 2025, when TI's stock fell more than 7% over the year, shares have rebounded 13% so far in 2026. Analyst Tore Svanberg from Stifel noted that the semiconductor industry's inventory adjustment pressures have largely eased, positioning TI for a return to steady growth this year.

On January 27, TI shares closed slightly higher at $196.63, but surged 8.23% to $212.81 in after-hours trading following the earnings release.