These Factors Influence Texas Instruments’ Profitability

The company’s profitability has been boosted by its higher revenue and lower production costs. Texas Instruments has been transitioning its analog production from 200mm (millimeter) to 300mm wafers, reducing its cost per chip by 40%. In 2017, the company manufactured 40% of its analog output on 300mm wafers, leaving it a lot of room to reduce production costs. Higher revenue and lower production costs expanded Texas Instruments’ gross margin by 90 basis points YoY (year-over-year) to 65.2% in the second quarter.