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Texas Instruments signals end of six-year 300mm expansion CapEx cycle
Wednesday, January 28, 2026 at 03:06 AM
Texas Instruments is reaching the conclusion of a six-year period of elevated capital expenditures. This multi-year expansion of 300mm wafer manufacturing capacity is expected to normalize, providing the company with high-scale, low-cost internal production capabilities.
Context
Texas Instruments is nearing the completion of a massive six-year investment cycle aimed at internalizing 300mm wafer manufacturing. Management recently signaled that capital intensity is set to "normalize" as this expansion winds down, marking a pivotal shift in the company’s financial strategy. By moving production away from older technology and external foundries, Texas Instruments aims to secure a permanent cost advantage, as 300mm wafers can reduce production costs by approximately 40% per chip compared to industry standards.
This transition is vital for investors as it signals a move from heavy capital outflow toward improved free cash flow generation. Peak annual spending, which reached approximately $5 billion, is expected to taper as major facilities in Texas and Utah come online through 2025 and 2026. This internal capacity provides a dependable, high-scale supply chain that reduces reliance on external partners, positioning the firm to capture industrial and automotive demand with significantly higher margins.
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