Texas Instruments (TXN) shares were up 6.5% during early market trading on Wednesday following its fourth-quarter results and outlook, which proved the data center buildout is benefitting more than just producers of GPUs and servers.
Several of Texas Instruments’ peers were trending higher as well
“Data Center continues to help drive topline growth with $450M in revenue for 4Q25 +MSD% Q/Q and $1.5B for C25 +64% Y/Y,” said Jefferies analysts, led by Blayne Curtis, in an investor note. “TXN is now breaking DC out as its own end market (45% DC Compute, 35% Networking, and 20% Power Delivery) with growth likely to track hyperscaler capex.”
Jefferies noted that the industrial end market was also improving, but growth in the auto sector remained modest.
“Overall, the results are a mild positive for the cycle, but nothing above and beyond what was expected,” Curtis added. “We see risks for the Personal Electronics and Auto segments as headwinds to the broader Analog recovery, and we remain on the sidelines.”
Jefferies maintained its Hold rating but increased its price target to $210 from $180.
Meanwhile, Morgan Stanley analysts said they had expected seasonal outperformance from Texas Instruments but needed to see more to upgrade the stock from its current Underweight rating.
“We continue to model TXN below the original CY26 revenue framework of $20–26bn, at MSe $19bn, as we need another consecutive quarter of growth to gain confidence in sustainability—consistent with CEO Haviv Ilan’s comment that ‘we’ll have to see how it plays out,'” said Morgan Stanley analysts, led by Joseph Moore, in a Wednesday note.
Morgan Stanley did inch up its price target to $180 from $175.
However, Bank of America was more positive on the results and outlook. It upgraded Texas Instruments to Neutral from Underperform and upgraded rival Microchip Technology (MCHP) to Buy from Neutral. BofA also increased Texas Instruments’ price target to $235 from $185 and Microchip’s to $95 from $78.
“This message of analog recovery came through loud in TXN’s Q1 outlook … and in our recent meetings with top analog companies at CES,” said BofA analysts, led by Vivek Arya, in a note.
“While the macro environment remains in flux, less-crowded analog stocks can reenergize driven by: 1) industrial inventory replenishment (shipments still 15-20% below trend), 2) emerging growth in data center power/connectivity and aero/defense markets, and 3) automotive content gains,” Arya added.
Microchip was up 6.5% during early trading on Wednesday.
Analog Devices (ADI) and Infineon Technologies (IFNNY) had both increased 4%. STMicroelectronics (STM) had edged up 2.2%.