Texas Instruments grew revenue 27.7% from the same quarter a year earlier in 2026Q3. Margins rose even faster, and the stock still trades below its peer group's middle multiple.
Sales are growing again, and fast
Texas Instruments had its biggest sales quarter of the last three years in 2026Q3. Revenue was 27.7% more than the same quarter a year earlier. It is also 10.8% more than the quarter before, so this is not just an easy comparison against a soft 2025. On the chart it is the tallest revenue bar of the last twelve quarters.
Data table
| period | revenue | yoy |
|---|---|---|
| 2023Q4 | $4.1bn | -12.7% |
| 2024Q1 | $3.7bn | -16.4% |
| 2024Q2 | $3.8bn | -15.6% |
| 2024Q3 | $4.2bn | -8.4% |
| 2024Q4 | $4.0bn | -1.7% |
| 2025Q1 | $4.1bn | 11.1% |
| 2025Q2 | $4.4bn | 16.4% |
| 2025Q3 | $4.7bn | 14.2% |
| 2025Q4 | $4.4bn | 10.4% |
| 2026Q1 | $4.8bn | 18.6% |
| 2026Q2 | $5.5bn | 22.8% |
| 2026Q3 | $6.1bn | 27.7% |
The headline looks like a boom. Step back and the picture is calmer: over the three years to 2026Q3, revenue grew at 10.1% a year. My reading is that most of this quarter's jump is the chip cycle swinging back up, not a new cruising speed. Sales were shrinking through 2024, and the same cycle that pulled them down is pulling them back.
Quick quiz
Revenue grew faster than in the quarter before. What grew even faster?
Why：Profit margins improved by more than sales did. The next section shows how.
Show answer
Profit as a share of sales Profit margins improved by more than sales did. The next section shows how.
Profit grew faster than sales
Gross margin was 64.2% of revenue in 2026Q3, up from 61.4% in 2026Q2. Operating margin reached 47.5%, which is 5.2 pp better than the quarter before. The operating expense ratio Running costs such as research and selling, measured as a share of sales. helped too, moving -2.3 pp as research and selling costs barely grew.
Glossary
- gross margin
- The share of each dollar of sales left after paying the direct cost of making the product.
- operating margin
- The share of each dollar of sales left after making costs and running costs, before interest and tax.
- operating expense ratio
- Running costs such as research and selling, measured as a share of sales.
Out of every dollar of sales last quarter, what share was left after the cost of making the chips?
Actual64.2%
Gross margin was 64.2% in 2026Q3. That is high for a business that pours concrete and buys machines, and it is why a good quarter lands so hard on profit.
Show answer
64.2% Gross margin was 64.2% in 2026Q3. That is high for a business that pours concrete and buys machines, and it is why a good quarter lands so hard on profit.
Data table
| order | category | amount | kind |
|---|---|---|---|
| 0 | 2026Q2 operating margin | 42.3% | total |
| 1 | Gross margin change | 2.8% | delta |
| 2 | Opex ratio change | 2.3% | delta |
| 3 | 2026Q3 operating margin | 47.5% | total |
That is the part a headline misses. My reading is simple: Texas Instruments owns its factories, so once those plants are paid for, extra chips moving through them arrive with very little extra cost. Figures here run through 2026Q3, the last quarter in the data.
After the jump, it is still not the pricey one
Texas Instruments trades at 36.7x trailing earnings The profit a company actually reported over its past four quarters, rather than a guess about the future.. The median The middle value in a list, so one very large name does not drag it the way an average does. of its peer group is 46.1x, which leaves the stock -20.4% below that median. The comparison covers 4 peers: Analog Devices, Microchip Technology, NXP Semiconductors and onsemi.
Glossary
- trailing earnings
- The profit a company actually reported over its past four quarters, rather than a guess about the future.
- median
- The middle value in a list, so one very large name does not drag it the way an average does.
Cheaper than peers is not the same as cheap. Microchip Technology carries the highest multiple of the five names and NXP Semiconductors the lowest, so a middle value built from so few names is pulled around by very different businesses. Each peer's multiple uses its own latest reported quarter, which is not always 2026Q3.
Risks
- Watch whether restructuring and other one-off items flatter the gap between the two quarters.
- A median drawn from only a handful of analog chipmakers moves easily and says little.
- Accounting or currency changes distort year-on-year comparisons; a headline growth rate hides both.
Sources
- SEC EDGAR XBRL companyfacts, TEXAS INSTRUMENTS INCORPORATED — data as of 2026-09-30; fetched 2026-10-24 16:53 UTC