Texas Instruments to invest $60 billion in US semiconductor fabs

DALLAS - Texas Instruments (NASDAQ:TXN), a $179.6 billion market cap semiconductor giant, announced plans to invest more than $60 billion across seven U.S. semiconductor manufacturing facilities, according to a company press release issued Wednesday. According to InvestingPro data, the company maintains a strong financial position with current assets more than five times its short-term obligations, providing solid backing for this massive investment.

The investment will span three manufacturing sites in Texas and Utah, with the company’s largest mega-site in Sherman, Texas receiving up to $40 billion for four fabrication plants. Two of these facilities are already under construction.

TI said the expansion will support more than 60,000 new U.S. jobs and represents what it describes as the largest investment in foundational semiconductor manufacturing in U.S. history.

The company currently produces analog and embedded processing chips used in smartphones, vehicles, data centers and other electronic devices. TI’s first new fabrication plant in Sherman is expected to begin initial production this year.

"TI is building dependable, low-cost 300mm capacity at scale to deliver the analog and embedded processing chips that are vital for nearly every type of electronic system," said Haviv Ilan, president and CEO of Texas Instruments.

U.S. Commerce Secretary Howard Lutnick stated that the partnership with TI "will support U.S. chip manufacturing for decades to come."

The company highlighted partnerships with major U.S. firms including Apple, Ford, Medtronic, NVIDIA and SpaceX, which use TI’s semiconductor components in their products.

Construction is complete on the exterior shell of TI’s second Sherman facility, while its Richardson, Texas plant continues to ramp up to full production. In Lehi, Utah, the company is increasing production at one facility while constructing a second connected plant.

In other recent news, Texas Instruments reported first-quarter revenue of $4.07 billion, exceeding expectations and marking a 4.3% increase from Stifel’s estimate of $3.90 billion. The company also provided a second-quarter revenue forecast with a midpoint of $4.35 billion, indicating a 6.9% sequential growth. Texas Instruments completed the sale of $1.2 billion in notes, with $550 million due in 2030 and $650 million due in 2035, as part of its corporate financing activities. Benchmark analyst Cody Acree lowered the stock’s price target to $200 from $230, maintaining a Buy rating, while UBS analyst Timothy Arcuri adjusted the price target to $215 from $225, also keeping a Buy rating. Both analysts noted the company’s solid performance and positive outlook despite broader economic uncertainties, including potential trade tensions. Bernstein SocGen upgraded the stock rating to Market Perform from Underperform, citing expectations of increased free cash flow per share. Stifel analysts maintained a Hold rating with a price target of $160, highlighting Texas Instruments’ cyclical recovery dynamics. These developments reflect a mix of optimism and caution as the company navigates a complex economic landscape.

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