Texas Instruments Inc. (NASDAQ:TXN)

Net Fixed Asset Turnover

The net fixed asset turnover ratio exhibits a consistent downward trend over the examined periods. It starts at a relatively high level above 4.4 in early 2021 and decreases steadily to approximately 1.4 by late 2025. The decline is particularly pronounced during the first half of the timeline, with values dropping sharply from over 4.5 in early 2021 to below 2 by the end of 2023. In the most recent periods, the ratio stabilizes somewhat, maintaining a narrow range around 1.3 to 1.4. This pattern suggests a progressively lower efficiency in generating sales from fixed assets over time, possibly reflecting increased investment in fixed assets or declining sales relative to these assets.

Total Asset Turnover

The total asset turnover ratio also demonstrates a gradual decrease across the reported quarters. Initially fluctuating slightly around 0.8 in 2021, the ratio declines steadily to about 0.44 by late 2024. Near the end of the observed period, a modest recovery occurs, with values increasing to approximately 0.49 in late 2025. Overall, this trend indicates a reduced ability to generate revenue from total assets, although the slight improvement at the end could imply some enhancement in asset utilization efficiency.

Equity Turnover

The equity turnover ratio follows a similar declining pattern. Starting from a higher level of approximately 1.5 in early 2021, it decreases consistently to just under 0.9 by late 2024. A small uptick is noted towards the end of the timeline, with the ratio rising to about 1.04 by late 2025. This trend indicates that the company’s ability to generate sales from its equity base eroded over time before showing marginal recovery recently. The increasing equity turnover at the end may suggest improved operational efficiency or changes in capital structure.

Summary

In summary, all three efficiency ratios—net fixed asset turnover, total asset turnover, and equity turnover—show notable declines over the period under review, reflecting a general decrease in asset and equity utilization efficiency. However, the figures demonstrate some stabilization or slight improvement in the most recent quarters. This overall trend may be indicative of shifting investment strategies, changing operational dynamics, or economic factors impacting the company's capacity to leverage its assets and equity to generate revenue.

The financial data reveals a consistent increase over the quarters in property, plant, and equipment (PP&E) investment, from US$3,431 million in the first quarter of 2021 to US$12,348 million by the third quarter of 2025. This steady growth indicates substantial capital expenditure and expansion efforts over the observed period.

In contrast, revenue displays a different pattern. After an initial rise from US$4,289 million in the first quarter of 2021 to a peak of US$5,241 million in the third quarter of 2022, revenue experiences fluctuations and an overall decline, reaching US$4,742 million by the third quarter of 2025. This suggests challenges in maintaining top-line growth in the latter periods despite the increased asset base.

The net fixed asset turnover ratio, which measures revenue generated per unit of fixed assets, shows a clear downward trend. It declines from 4.49 in the first quarter of 2021 to approximately 1.40 by the third quarter of 2025. This decreasing ratio implies diminishing efficiency in utilizing fixed assets to generate revenue, reflecting that the pace of asset accumulation has outstripped the growth in revenue.

Property, Plant and Equipment

Steady and significant growth, nearly quadrupling over the observed quarters, indicative of ongoing capital investment and asset accumulation.

Revenue

Reaches peak mid-period, then trends downward with some volatility. The declining revenue despite increased asset base points to possible market or operational challenges.

Net Fixed Asset Turnover Ratio

Consistent decrease, showing reduced efficiency in generating revenue from fixed assets, which may signal overinvestment or underutilization of assets.

Overall, the data suggests that while there has been aggressive investment in fixed assets, this has not translated into proportional revenue growth. The declining asset turnover ratio cautions about the diminishing returns on asset investments and highlights the need for strategic review to enhance operational efficiency and revenue generation capacity.

The analysis of the financial data reveals notable trends in revenue, total assets, and total asset turnover over the examined periods.

Revenue

Revenue experienced a general upward trend from March 2021 through June 2022, increasing from approximately $4.3 billion to a peak near $5.2 billion. However, a subsequent decline followed, reaching a low point around $3.7 billion by March 2024. From that point onward, revenue demonstrated a recovery phase, climbing again to approximately $4.7 billion by September 2025. This indicates cyclicality with periods of growth followed by contraction and moderate recovery toward the end of the timeline.

Total Assets

Total assets consistently increased over the entire period under review. Starting near $19.6 billion in March 2021, they rose steadily to about $35 billion by the end of the analysis in September 2025. This sustained growth in asset base suggests ongoing investment or asset accumulation despite fluctuations in revenue, reflecting a possible strategy of capacity expansion or capital investment.

Total Asset Turnover

The total asset turnover ratio, which measures efficiency in utilizing assets to generate revenue, showed a clear declining trend throughout the period. Initially near 0.79 in early 2021, it steadily decreased to around 0.44 by the end of 2024, with a slight uptick to approximately 0.49 by September 2025. This decline implies that the growth in assets was not matched proportionally by revenue increases, indicating diminishing efficiency in asset utilization over time.

In summary, while total assets increased consistently, revenue exhibited volatility with an initial growth phase, a decline, and subsequent partial recovery. The decreasing asset turnover ratio underscores a weakening in operational efficiency with respect to asset usage, which may warrant further operational review to enhance revenue generation relative to asset investment.

The analysis of the financial metrics over the observed periods reveals several noteworthy trends. The revenue experienced fluctuations, with a general pattern of increase in some years followed by declines in subsequent quarters. Starting at approximately $4.3 billion in early 2021, revenue peaked around $5.2 billion in mid-2022 before trending downward to about $3.7 billion by the first quarter of 2024. Subsequently, there was a recovery phase with revenue rising again, reaching roughly $4.7 billion by the third quarter of 2025.

In contrast, stockholders’ equity showed a consistent upward trajectory over the analyzed timeframe. Beginning at approximately $10.2 billion in the first quarter of 2021, it steadily increased to about $16.6 billion by the third quarter of 2025. This persistent growth in equity indicates sustained value accumulation and financial strengthening despite the revenue volatility.

The equity turnover ratio, which measures the efficiency of using equity to generate revenue, exhibited a downward trend initially. It declined from a ratio of 1.52 in early 2021 to as low as 0.91 by the third quarter of 2024, indicating weakening efficiency in converting equity into sales. However, following this low point, the ratio showed signs of improvement, rising to about 1.04 by the third quarter of 2025. This recovery could suggest operational adjustments or improved market conditions enhancing revenue generation relative to equity.

Revenue Trends

Demonstrated cyclical fluctuations with a peak in mid-2022 followed by a decline and a gradual recovery by late 2025.

Stockholders’ Equity

Displayed consistent growth throughout the periods, reflecting robust shareholder value enhancement.

Equity Turnover Ratio

Experienced a decline in efficiency from 2021 to 2024, then a gradual rebound suggesting improved capital utilization efficiency.

Overall, the data reflects a company that faced challenges in maintaining revenue growth consistently but managed to increase shareholder equity steadily. The improvement in equity turnover ratio towards the end of the period suggests potential strategic or operational efforts yielding enhanced returns on equity.