Stock Analysis on Net
Stock Analysis on Net

Texas Instruments Inc. (NASDAQ:TXN)

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

Texas Instruments Inc., income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
U.S. federal 605 943 1,235 948 357
Non-U.S. 244 240 212 169 192
U.S. state 15 24 27 18 10
Current 864 1,207 1,474 1,135 559
U.S. federal (139) (277) (223) (23) (122)
Non-U.S. (71) (22) 32 38 (15)
Deferred (210) (299) (191) 15 (137)
Provision for income taxes 654 908 1,283 1,150 422

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Current Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Texas Instruments Inc. current decreased from 2022 to 2023 and from 2023 to 2024.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Texas Instruments Inc. deferred decreased from 2022 to 2023 but then increased from 2023 to 2024 not reaching 2022 level.
Provision for income taxes Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Texas Instruments Inc. provision for income taxes decreased from 2022 to 2023 and from 2023 to 2024.

Effective Income Tax Rate (EITR)

Texas Instruments Inc., effective income tax rate (EITR) reconciliation

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
U.S. statutory income tax rate 21.00% 21.00% 21.00% 21.00% 21.00%
Foreign derived intangible income -6.10% -6.80% -7.00% -6.10% -6.10%
Stock compensation -2.10% -1.00% -0.70% -1.50% -2.50%
R&D tax credit -2.00% -1.30% -0.90% -0.90% -1.30%
Changes in uncertain tax positions 0.10% 0.00% 0.10% -0.20% -4.00%
Other 1.10% 0.30% 0.30% 0.60% -0.10%
Effective tax rate 12.00% 12.20% 12.80% 12.90% 7.00%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Effective tax rate Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Texas Instruments Inc. effective tax rate decreased from 2022 to 2023 and from 2023 to 2024.

Components of Deferred Tax Assets and Liabilities

Texas Instruments Inc., components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Capitalized R&D 1,076 750 380 — —
Accrued expenses 297 236 182 209 180
Deferred loss and tax credit carryforwards 216 205 201 207 207
Stock compensation 186 163 132 110 106
Inventories 105 104 88 74 105
Retirement costs for defined benefit and retiree health care 17 37 43 — 44
Other 23 47 36 40 3
Deferred tax assets, before valuation allowance 1,920 1,542 1,062 640 645
Valuation allowance (212) (198) (189) (188) (179)
Deferred tax assets, after valuation allowance 1,708 1,344 873 452 466
Property, plant and equipment (441) (592) (410) (197) (116)
CHIPS Act incentives (336) — — — —
International earnings (33) (33) (35) (38) (44)
Acquisition-related intangibles and fair-value adjustments (6) (14) (13) (12) (40)
Retirement costs for defined benefit and retiree health care — — — (15) —
Other (9) (11) (8) (14) (13)
Deferred tax liabilities (825) (650) (466) (276) (213)
Net deferred tax asset (liability) 883 694 407 176 253

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Deferred tax assets, before valuation allowance Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Texas Instruments Inc. deferred tax assets, before valuation allowance increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax assets, after valuation allowance Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Texas Instruments Inc. deferred tax assets, after valuation allowance increased from 2022 to 2023 and from 2023 to 2024.
Net deferred tax asset (liability) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Texas Instruments Inc. net deferred tax asset (liability) increased from 2022 to 2023 and from 2023 to 2024.

Deferred Tax Assets and Liabilities, Classification

Texas Instruments Inc., deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Deferred tax assets 936 757 473 263 343
Deferred tax liabilities 53 63 66 87 90

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Deferred tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Texas Instruments Inc. deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax liabilities Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Texas Instruments Inc. deferred tax liabilities decreased from 2022 to 2023 and from 2023 to 2024.

Adjustments to Financial Statements: Removal of Deferred Taxes

Texas Instruments Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Adjustment to Total Assets
Total assets (as reported) 35,509 32,348 27,207 24,676 19,351
Less: Noncurrent deferred tax assets, net 936 757 473 263 343
Total assets (adjusted) 34,573 31,591 26,734 24,413 19,008
Adjustment to Total Liabilities
Total liabilities (as reported) 18,606 15,451 12,630 11,343 10,164
Less: Noncurrent deferred tax liabilities, net 53 63 66 87 90
Total liabilities (adjusted) 18,553 15,388 12,564 11,256 10,074
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported) 16,903 16,897 14,577 13,333 9,187
Less: Net deferred tax assets (liabilities) 883 694 407 176 253
Stockholders’ equity (adjusted) 16,020 16,203 14,170 13,157 8,934
Adjustment to Net Income
Net income (as reported) 4,799 6,510 8,749 7,769 5,595
Add: Deferred income tax expense (benefit) (210) (299) (191) 15 (137)
Net income (adjusted) 4,589 6,211 8,558 7,784 5,458

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Texas Instruments Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Texas Instruments Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net Profit Margin
Reported net profit margin 30.68% 37.16% 43.68% 42.35% 38.69%
Adjusted net profit margin 29.34% 35.45% 42.73% 42.43% 37.74%
Total Asset Turnover
Reported total asset turnover 0.44 0.54 0.74 0.74 0.75
Adjusted total asset turnover 0.45 0.55 0.75 0.75 0.76
Financial Leverage
Reported financial leverage 2.10 1.91 1.87 1.85 2.11
Adjusted financial leverage 2.16 1.95 1.89 1.86 2.13
Return on Equity (ROE)
Reported ROE 28.39% 38.53% 60.02% 58.27% 60.90%
Adjusted ROE 28.65% 38.33% 60.40% 59.16% 61.09%
Return on Assets (ROA)
Reported ROA 13.51% 20.12% 32.16% 31.48% 28.91%
Adjusted ROA 13.27% 19.66% 32.01% 31.88% 28.71%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Texas Instruments Inc. adjusted net profit margin ratio deteriorated from 2022 to 2023 and from 2023 to 2024.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Texas Instruments Inc. adjusted total asset turnover ratio deteriorated from 2022 to 2023 and from 2023 to 2024.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Texas Instruments Inc. adjusted financial leverage ratio increased from 2022 to 2023 and from 2023 to 2024.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Texas Instruments Inc. adjusted ROE deteriorated from 2022 to 2023 and from 2023 to 2024.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Texas Instruments Inc. adjusted ROA deteriorated from 2022 to 2023 and from 2023 to 2024.

Texas Instruments Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Net income 4,799 6,510 8,749 7,769 5,595
Revenue 15,641 17,519 20,028 18,344 14,461
Profitability Ratio
Net profit margin1 30.68% 37.16% 43.68% 42.35% 38.69%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income 4,589 6,211 8,558 7,784 5,458
Revenue 15,641 17,519 20,028 18,344 14,461
Profitability Ratio
Adjusted net profit margin2 29.34% 35.45% 42.73% 42.43% 37.74%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 Net profit margin = 100 × Net income ÷ Revenue
= 100 × 4,799 ÷ 15,641 = 30.68%

2 Adjusted net profit margin = 100 × Adjusted net income ÷ Revenue
= 100 × 4,589 ÷ 15,641 = 29.34%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Texas Instruments Inc. adjusted net profit margin ratio deteriorated from 2022 to 2023 and from 2023 to 2024.

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Revenue 15,641 17,519 20,028 18,344 14,461
Total assets 35,509 32,348 27,207 24,676 19,351
Activity Ratio
Total asset turnover1 0.44 0.54 0.74 0.74 0.75
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Revenue 15,641 17,519 20,028 18,344 14,461
Adjusted total assets 34,573 31,591 26,734 24,413 19,008
Activity Ratio
Adjusted total asset turnover2 0.45 0.55 0.75 0.75 0.76

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 Total asset turnover = Revenue ÷ Total assets
= 15,641 ÷ 35,509 = 0.44

2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 15,641 ÷ 34,573 = 0.45

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Texas Instruments Inc. adjusted total asset turnover ratio deteriorated from 2022 to 2023 and from 2023 to 2024.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Total assets 35,509 32,348 27,207 24,676 19,351
Stockholders’ equity 16,903 16,897 14,577 13,333 9,187
Solvency Ratio
Financial leverage1 2.10 1.91 1.87 1.85 2.11
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets 34,573 31,591 26,734 24,413 19,008
Adjusted stockholders’ equity 16,020 16,203 14,170 13,157 8,934
Solvency Ratio
Adjusted financial leverage2 2.16 1.95 1.89 1.86 2.13

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 Financial leverage = Total assets ÷ Stockholders’ equity
= 35,509 ÷ 16,903 = 2.10

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 34,573 ÷ 16,020 = 2.16

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Texas Instruments Inc. adjusted financial leverage ratio increased from 2022 to 2023 and from 2023 to 2024.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Net income 4,799 6,510 8,749 7,769 5,595
Stockholders’ equity 16,903 16,897 14,577 13,333 9,187
Profitability Ratio
ROE1 28.39% 38.53% 60.02% 58.27% 60.90%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income 4,589 6,211 8,558 7,784 5,458
Adjusted stockholders’ equity 16,020 16,203 14,170 13,157 8,934
Profitability Ratio
Adjusted ROE2 28.65% 38.33% 60.40% 59.16% 61.09%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 4,799 ÷ 16,903 = 28.39%

2 Adjusted ROE = 100 × Adjusted net income ÷ Adjusted stockholders’ equity
= 100 × 4,589 ÷ 16,020 = 28.65%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Texas Instruments Inc. adjusted ROE deteriorated from 2022 to 2023 and from 2023 to 2024.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Net income 4,799 6,510 8,749 7,769 5,595
Total assets 35,509 32,348 27,207 24,676 19,351
Profitability Ratio
ROA1 13.51% 20.12% 32.16% 31.48% 28.91%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income 4,589 6,211 8,558 7,784 5,458
Adjusted total assets 34,573 31,591 26,734 24,413 19,008
Profitability Ratio
Adjusted ROA2 13.27% 19.66% 32.01% 31.88% 28.71%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 4,799 ÷ 35,509 = 13.51%

2 Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 4,589 ÷ 34,573 = 13.27%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Texas Instruments Inc. adjusted ROA deteriorated from 2022 to 2023 and from 2023 to 2024.