Texas Instruments Incorporated stock research
FY2023 Q2
Texas Instruments (TXN) Gross Margin — Quarter Ended Jun 30, 2023
Revenue and gross profit both declined compared with the same quarter one year earlier, while cost of revenue was stable, resulting in a lower gross margin. Sequentially, revenue increased slightly and cost of revenue rose, leading to a modest decline in gross margin.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q2
Revenue and gross profit both declined compared with the same quarter one year earlier, while cost of revenue was stable, resulting in a lower gross margin. Sequentially, revenue increased slightly and cost of revenue rose, leading to a modest decline in gross margin.
- The gross margin weakened both sequentially and versus the prior year, driven by a combination of lower revenue and higher or stable cost of revenue. The sequential decline was primarily associated with a proportionally larger increase in cost of revenue relative to the revenue increase.
- Compared with the immediately preceding quarter, revenue was slightly higher and gross profit was roughly stable, but cost of revenue increased, causing gross margin to decline. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all lower, while cost of revenue was comparable.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
64.2%
Gross profit
$2.9B
Revenue
$4.5B
Cost of revenue
$1.6B
Quarter-over-quarter change
-1.2 pts
Year-over-year change
-5.3 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2023 | $4.4B | $2.9B | $1.5B | 65.4% |
| Jun 30, 2023 | $4.5B | $2.9B | $1.6B | 64.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
-1.2 pts
Year-over-year change
Jun 30, 2022
-5.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin weakened both sequentially and versus the prior year, driven by a combination of lower revenue and higher or stable cost of revenue. The sequential decline was primarily associated with a proportionally larger increase in cost of revenue relative to the revenue increase.
Compared with the immediately preceding quarter, revenue was slightly higher and gross profit was roughly stable, but cost of revenue increased, causing gross margin to decline. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all lower, while cost of revenue was comparable.
Monitor the trend in cost of revenue relative to revenue, as the current quarter showed an increase that outpaced revenue growth sequentially.