By Mackenzie Tatananni
Texas Instruments shares surged nearly 20% on Thursday following strong first-quarter earnings -- but it was the company's optimistic outlook that helped boost confidence in other semiconductor stocks.
The maker of analog and embedded processing chips said it is targeting second-quarter revenue in the range of $5 billion to $5.4 billion and second-quarter earnings of $1.77 to $2.05 a share. Analysts tracked by FactSet were looking for $5.06 billion and $1.78 a share.
First-quarter data center revenue surged 90% as the buildout of artificial-intelligence infrastructure continued, helping the Dallas-based company log its eighth consecutive quarter of growth in the segment.
There were signs of rebounding demand in other end markets, as Chairman and CEO Haviv Ilan noted on the earnings call. "I will say that the industrial signal was a little bit broader this time," Ilan told analysts. "I would say it's now five or six months of continued growth in industrial."
While the company continues to watch the space, this strength will guide Texas Instrument's forecast into the second quarter, he added.
The upbeat guidance helped lift a handful of other semiconductor stocks, with some heading for record closes. On Semiconductor jumped 10% to $98.06, putting shares on pace for a new closing high. Analog Devices advanced 6.4% to $405.98, also heading for a record.
NXP Semiconductors and Microchip Technology also were posting steep gains, rallying 7.5% each.
Benchmark analyst Cody Acree noted that investors continue to question "the durability of the current cyclical demand strength," as they may be tricked into thinking a massive recovery is underway, only for that momentum to collapse in the second half of the year.
However, Acree believes this could be the start of a more durable recovery in analog semiconductors, "particularly given the markets consistently improving demand signals across a mix of end markets."
There was even more to Texas Instruments' earnings report. Following several years of heavy investments in updating manufacturing equipment, capital expenditures returned to more normal levels in the latest quarter. Texas Instruments posted first-quarter capex of $676 million, in turn boosting its free cash flow.
The company's profit rose to $1.55 billion from $1.18 billion last year. Revenue surged 19% to $4.83 billion, blowing past analysts' calls for $4.53 billion.
Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
April 23, 2026 13:24 ET (17:24 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments