Texas Instruments Incorporated stock research
FY2025 Q4
Texas Instruments (TXN) Gross Margin — Quarter Ended Dec 31, 2025
Revenue decreased from the prior quarter, while cost of revenue was unchanged, causing gross profit to decline and gross margin to weaken. Relative to the same quarter a year earlier, revenue and gross profit were higher, but cost of revenue grew more, resulting in a lower gross margin.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Revenue decreased from the prior quarter, while cost of revenue was unchanged, causing gross profit to decline and gross margin to weaken. Relative to the same quarter a year earlier, revenue and gross profit were higher, but cost of revenue grew more, resulting in a lower gross margin.
- The strongest observable margin driver is the unchanged cost of revenue despite a decline in revenue. This allowed the cost of revenue to consume a larger share of revenue, directly reducing the gross margin.
- Compared to the immediately preceding quarter, gross margin weakened. Compared to the same quarter one year earlier, gross margin also weakened.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
55.9%
Gross profit
$2.5B
Revenue
$4.4B
Cost of revenue
$2.0B
Quarter-over-quarter change
-1.5 pts
Year-over-year change
-1.9 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, 2025 | $4.1B | $2.3B | $1.8B | 56.8% |
| Jun 30, 2025 | $4.4B | $2.6B | $1.9B | 57.9% |
| Sep 30, 2025 | $4.7B | $2.7B | $2.0B | 57.4% |
| Dec 31, 2025 | $4.4B | $2.5B | $2.0B | 55.9% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
-1.5 pts
Year-over-year change
Dec 31, 2024
-1.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the unchanged cost of revenue despite a decline in revenue. This allowed the cost of revenue to consume a larger share of revenue, directly reducing the gross margin.
Compared to the immediately preceding quarter, gross margin weakened. Compared to the same quarter one year earlier, gross margin also weakened.
Monitor whether cost of revenue remains stable as revenue changes, as this has a direct impact on gross margin.