Mizuho raised Texas Instruments NASDAQ:TXN price target to $305 from $300 while keeping a Neutral rating, citing data center growth. The chipmaker reported June quarter revenue of $5.46 billion against consensus of $5.23 billion, and guided September quarter revenue to $5.90 billion, up 8% sequentially and above the $5.61 billion expected. Texas Instruments shares were 3.61% lower intraday.
Revenue from the data center segment doubled year over year to an estimated $676 million a quarter, roughly 12% of the total, picking up from 90% growth in the prior quarter and rising 20% sequentially. Industrial revenue grew 10% sequentially and automotive about 8%, with utilization increasing and expected to keep climbing into the September quarter.
Margins are expanding alongside. June quarter gross margin rose 340 basis points to 61.4%, and Mizuho estimates a further 150 basis point gain to 62.9% in the September quarter. The firm values the stock at roughly 31x its calendar 2027 earnings estimate.