TI delivered impressive Q3 results with revenue growing 12.9% YoY to $5.24B and operating margin expanding to 51.1%. Gross margin improved 130bps YoY to 69.0% despite inflationary pressures, driven by pricing power and product mix optimization. The company continues aggressive capacity expansion with $494M in Q3 capex as it positions for long-term analog and embedded processing growth. However, rising inventory levels and restructuring charges signal potential near-term demand softening.
Edge computing and IoT expanding addressable markets
Bottom Line
TI's Q3 results demonstrate the company's strong competitive position and operational execution despite growing macro headwinds. While near-term demand uncertainty exists, as evidenced by rising inventory levels and restructuring charges, the company's strategic investments in manufacturing capacity and focus on industrial/automotive markets position it well for long-term growth. The combination of pricing power, cost advantages from 300mm manufacturing, and broad customer diversification should enable continued strong profitability through cycles. Key metrics to watch include inventory turns, book-to-bill ratio, and automotive/industrial end market demand trends.