Texas Instruments revenue rises 28% as industrial chip sales jump over 40%

Texas Instruments, one of the largest makers of analog chips, reported third-quarter revenue of $6.06 billion on Tuesday, October 21, 2026, up about 28% from a year earlier and ahead of analysts' forecasts of about $5.92 billion. Net income was $2.43 billion, or $2.62 a share. The company said sales to factories and industrial equipment makers grew more than 40% from a year earlier, and it forecast fourth-quarter revenue of $5.80 billion to $6.30 billion, a range whose midpoint was above Wall Street's expectations and above the usual seasonal pattern.

Most people never see a Texas Instruments chip, but almost every machine uses them. The company specialises in analog and embedded processing chips: the parts that manage power, read sensors, convert real-world signals such as temperature, pressure or motion into digital data, and control motors. They sit inside factory robots, electric vehicles, medical devices, power grids and, increasingly, the racks of servers in AI data centres. Because these chips go into so many different products, the company's sales work as an early signal of how much the world's manufacturers are actually building.

That is why the industrial number stands out. Factory and industrial customers worldwide had cut back their chip orders for several years. Ilan's comment that industrial sales have only now climbed back to their 2022 level shows how long that downturn lasted, and a jump of more than 40% in a year suggests that factory automation spending, the heart of what is often called Industry 4.0, is picking up again. Industry 4.0 refers to the use of connected sensors, automation, data and software to run factories more efficiently, and analog chips are the basic hardware that makes it possible.

The data-centre figure tells a second story. The race to build AI computing capacity is usually discussed in terms of Nvidia's graphics processors, but every AI server also needs chips that deliver and regulate large amounts of power. Texas Instruments now earns 13% of its revenue from data centres, with that business almost doubling in a year. This shows how AI spending is spreading from the most advanced chipmakers to suppliers of more basic components.

The fourth-quarter forecast matters because the last three months of the year are usually weaker for chipmakers. By guiding to roughly flat revenue at the midpoint, the company is signalling that demand is strong enough to resist that seasonal dip. The company has also guided capital spending of $2 billion to $3 billion for 2026, aiming for the higher end. Some analysts questioned how long above-seasonal demand can last, and early after-hours share moves were small and mixed.

For Indian manufacturers, the results are a useful reading of global factory demand. Indian automotive and industrial companies buy the same kind of chips and supply parts to the same global customers, so a recovery in worldwide industrial orders is generally good news for exporters of components and machinery.

Short-term: The results support the view that industrial chip demand has turned upward, which may ease worries among investors in other suppliers to factories and carmakers. Chip buyers may face tighter supply and firmer prices if the recovery continues.

Long-term: Strong demand from both factories and AI data centres gives the company room to keep investing in new chip plants. If industrial demand keeps recovering, it would mark the end of a long slump in spending on factory equipment worldwide.

Who is affected: Manufacturers that use analog chips in machinery, vehicles and electronics; data-centre builders; investors in semiconductor companies; and Indian component makers and exporters whose orders track global industrial demand.

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