Stock Analysis on Net

Texas Instruments Inc. (NASDAQ:TXN)

Analysis of Operating Leases

Microsoft Excel

Adjustments to Financial Statements for Operating Leases

Texas Instruments Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 32,348 27,207 24,676 19,351 18,018
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)1
Total assets (adjusted) 32,348 27,207 24,676 19,351 18,018
Adjustment to Total Debt
Total debt (as reported) 11,223 8,735 7,741 6,798 5,803
Add: Operating lease liability (before adoption of FASB Topic 842)2
Add: Operating lease liabilities (included in Accrued expenses and other liabilities) 88 75 82 72 73
Add: Operating lease liabilities (included in Other long-term liabilities) 478 344 383 249 259
Total debt (adjusted) 11,789 9,154 8,206 7,119 6,135

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1, 2 Equal to total present value of future operating lease payments.


Texas Instruments Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios for Operating Leases (Summary)

Texas Instruments Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total Asset Turnover1
Reported total asset turnover 0.54 0.74 0.74 0.75 0.80
Adjusted total asset turnover 0.54 0.74 0.74 0.75 0.80
Debt to Equity2
Reported debt to equity 0.66 0.60 0.58 0.74 0.65
Adjusted debt to equity 0.70 0.63 0.62 0.77 0.69
Return on Assets3 (ROA)
Reported ROA 20.12% 32.16% 31.48% 28.91% 27.84%
Adjusted ROA 20.12% 32.16% 31.48% 28.91% 27.84%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Texas Instruments Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted debt to equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Texas Instruments Inc. adjusted debt to equity ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Texas Instruments Inc. adjusted ROA improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Texas Instruments Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Revenue 17,519 20,028 18,344 14,461 14,383
Total assets 32,348 27,207 24,676 19,351 18,018
Activity Ratio
Total asset turnover1 0.54 0.74 0.74 0.75 0.80
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Revenue 17,519 20,028 18,344 14,461 14,383
Adjusted total assets 32,348 27,207 24,676 19,351 18,018
Activity Ratio
Adjusted total asset turnover2 0.54 0.74 0.74 0.75 0.80

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Total asset turnover = Revenue ÷ Total assets
= 17,519 ÷ 32,348 = 0.54

2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 17,519 ÷ 32,348 = 0.54

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Texas Instruments Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Debt to Equity

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total debt 11,223 8,735 7,741 6,798 5,803
Stockholders’ equity 16,897 14,577 13,333 9,187 8,907
Solvency Ratio
Debt to equity1 0.66 0.60 0.58 0.74 0.65
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Adjusted total debt 11,789 9,154 8,206 7,119 6,135
Stockholders’ equity 16,897 14,577 13,333 9,187 8,907
Solvency Ratio
Adjusted debt to equity2 0.70 0.63 0.62 0.77 0.69

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Debt to equity = Total debt ÷ Stockholders’ equity
= 11,223 ÷ 16,897 = 0.66

2 Adjusted debt to equity = Adjusted total debt ÷ Stockholders’ equity
= 11,789 ÷ 16,897 = 0.70

Solvency ratio Description The company
Adjusted debt-to-equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Texas Instruments Inc. adjusted debt-to-equity ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income 6,510 8,749 7,769 5,595 5,017
Total assets 32,348 27,207 24,676 19,351 18,018
Profitability Ratio
ROA1 20.12% 32.16% 31.48% 28.91% 27.84%
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Net income 6,510 8,749 7,769 5,595 5,017
Adjusted total assets 32,348 27,207 24,676 19,351 18,018
Profitability Ratio
Adjusted ROA2 20.12% 32.16% 31.48% 28.91% 27.84%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 6,510 ÷ 32,348 = 20.12%

2 Adjusted ROA = 100 × Net income ÷ Adjusted total assets
= 100 × 6,510 ÷ 32,348 = 20.12%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Texas Instruments Inc. adjusted ROA improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.