Shares of Texas Instruments declined 1.13% on Friday, closing at $221.44, underperforming the broader market indices. The S&P 500 and Dow Jones Industrial Average posted gains of 1.97% and 2.47%, respectively, highlighting the stock's relative weakness during the session.
Capital Expenditure Reset
Recent SEC filings reveal a significant strategic shift for the analog chipmaker. The company is planning to reduce its capital expenditures to a range of $2 billion to $3 billion in 2026, a sharp decrease from the $4.55 billion budgeted for 2025. This move is expected to boost free cash flow, which the company projects will reach $2.94 billion in 2025 after accounting for CHIPS Act incentives.
Acquisition Financing and Insider Activity
Concurrently, Texas Instruments is moving forward with its planned acquisition of Silicon Labs, its largest deal in years. The transaction, anticipated to close in the first half of 2027, is slated to be financed through a combination of cash on hand and debt. The company expects the deal to generate approximately $450 million in annual cost synergies within three years of closing.
Notably, insider selling activity accompanied the news. Senior Vice President Ahmad Bahai sold 3,000 shares at a weighted average price of $223.4622, while Director Mark Blinn sold 3,144 shares at $221.5798. Both sales followed the exercise of stock options.
Upcoming Catalysts and Market Context
The coming weeks present several key events for investors. Silicon Labs is scheduled to report its quarterly earnings on February 10, which may provide insights into demand trends and the progress of the acquisition. Furthermore, Texas Instruments will host a capital-management webcast on February 24, where details on spending plans and cash-return policies are likely to be scrutinized.
The stock's performance reflects a divergence within the semiconductor sector, where analog chipmakers like Texas Instruments are more tied to industrial and automotive cycles than to the artificial intelligence-driven rally seen in other segments. The company also amended its corporate bylaws to include a forum-selection clause directing certain legal disputes to Delaware courts.
