Data center revenue rose about 90% from a year ago as hyperscalers accelerate infrastructure spending
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Texas Instruments $TXN reported first-quarter revenue of $4.83 billion, up 19% from a year earlier, with net income rising 31% to $1.55 billion and earnings per share of $1.68. Analysts had projected revenue of $4.53 billion and EPS of $1.27, according to CNBC.
Shares jumped 18% following the report, reaching an all-time high — a one-day gain not seen since 2000, CNBC noted.
During the earnings call, Ilan said the data center segment grew about 90% year over year, while the industrial unit gained 30%. He described the quarter as showing expansion across key markets, stating: "Revenue increased 9% sequentially and 19% from the same quarter a year ago with growth led by industrial and data center."
At $3.92 billion, analog revenue grew 22% year over year, extending the company's lead in its biggest product category. Embedded processing brought in $723 million, a 12% increase, and the segment's operating profit surged more than threefold.
For the second quarter, Texas Instruments forecast revenue of $5 billion to $5.4 billion and EPS of $1.77 to $2.05, the company said.
Power regulation and signal conversion — functions handled by TI's analog chips — make the company an important supplier to data centers even without a presence in the advanced processor market. The company said its data center business now generates more than $1 billion in annual revenue, according to Digitimes.
Ilan told CNBC that the company is prepared for continued growth. "If the market wants to grow at the same rate as Q1, we mentioned 19% year over year, we are ready. If it wants to accelerate, we are ready as well," he said.
Operating profit for the quarter rose 37% to $1.81 billion. Cash flow from operations reached $1.52 billion for the quarter, and free cash flow over the trailing 12 months was $4.35 billion, up 154% from a year earlier.
First-quarter spending on plants and equipment came to $676 million, roughly half the $1.1 billion outlay recorded in the year-earlier period. The company received $555 million in proceeds from U.S. CHIPS Act incentives during the quarter.
Texas Instruments returned $1.45 billion to shareholders in the quarter, including $1.29 billion in dividends and $158 million in stock repurchases.
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