“We expect TI's revenue in the range of $5.65 billion to $6.15 billion and earnings per share to be in the range of $2.23 to $2.57.”

In context

“Rafael Lizardi : Thanks, Haviv, and good afternoon, everyone. As Haviv mentioned, second quarter revenue was $5.5 billion. Gross profit in the quarter was $3.4 billion or 61% of revenue. Sequentially, gross profit margin increased 340 basis points. Operating expenses in the quarter were $1 billion, about as expected. On a trailing 12-month basis, operating expenses were $3.9 billion or 20% of revenue. Operating profit was $2.3 billion in the quarter or 42% of revenue, and it was up 48% from the year ago quarter. Net income in the quarter was $2 billion or $2.14 per share. Earnings per share included a $0.05 benefit not in our original guidance due to discrete tax benefits. Let me now comment on our capital management results, starting with our cash generation. Cash flow from operations was $2.7 billion in the quarter and $8.7 billion on a trailing 12-month basis. Capital expenditures were $514 million in the quarter and $3.3 billion over the last 12 months. Free cash flow on a trailing 12-month basis was $6.5 billion, up from $1.8 billion in the second quarter of 2025 and continuing to trend up as growth returns. Free cash flow in the trailing 12 months includes $1.6 billion of CHIPS Act incentives, which includes both the investment tax credit and direct funding. In second quarter, we received $549 million of ITC-related payments for qualifying capital expenditures. In the quarter, we paid $1.3 billion in dividends. In total, we returned $5.8 billion to our owners in the past 12 months. Our balance sheet remains strong with $7 billion of cash and short-term investments at the end of the second quarter. Total debt outstanding is $14 billion with a weighted average coupon of 4%. Inventory at the end of the quarter was $4.6 billion, down $90 million from the prior quarter, and days were 196, down 13 days sequentially. Turning to our outlook for the third quarter. We expect TI's revenue in the range of $5.65 billion to $6.15 billion and earnings per share to be in the range of $2.23 to $2.57. We expect our effective tax rate to be about 13% in the third quarter. In closing, we will stay focused in the areas that add value in the long term. We continue to invest in our competitive advantages, which are manufacturing and technology, a broad product portfolio, reach of our channels and diverse and long-lived positions. We will continue to strengthen these advantages through disciplined capital allocation and by focusing on the best opportunities, which we believe will enable us to continue to deliver free cash flow per share growth over the long term. Before I turn it over to Mike to start Q&A, I want to say that it has been an honor to work at Texas Instruments for the last 25 years and to have been CFO during the last decade. I have thoroughly enjoyed working with so many wonderful people. Over that time, we have made TI stronger and positioned it for continued success. I feel confident about the future at TI, and I'm looking forward to what's ahead for the company.”