GET DAILY SIGNALSADI vs TXN: Weighing Two Analog Semiconductor Leaders in the AI Cycle
Key Takeaways
- ADI (Analog Devices, Inc.) posted record fiscal second-quarter 2026 revenue of $3.62 billion, up 37% year over year, with data center revenue climbing more than 90%.
- TXN (Texas Instruments Incorporated) reported third-quarter 2026 revenue of $6.06 billion, up 28% year over year, led by a 32% jump in its analog segment.
- ADI's adjusted gross margin of 73% and operating margin of 49% currently exceed TXN's gross margin of 64% and operating margin of 47%, reflecting a richer product mix.
- TXN retains a clear scale advantage as the world's largest analog chip maker and recently extended its dividend-increase streak to 23 consecutive years.
- Tickeron AI Verdict: ADI is the favored ticker in this comparison, based on stronger revenue growth, wider margins, and clearer AI-related catalysts.
- Explore deeper coverage of each company through ADI Major News and ADI Today's Price Move, as well as TXN Major News and TXN Today's Price Move.
- Discover which automated strategies are currently top performers by exploring Trending AI Robots.
Introduction
Analog Devices and Texas Instruments stand among the most closely watched companies in the analog semiconductor space, where chips convert real-world signals like sound, temperature, and power into digital formats. Both are riding a recovery in industrial and automotive markets while also tapping into strong growth from artificial intelligence data center spending. This comparison matters for investors looking to understand differences in business focus, growth pace, profitability, and competitive stance. Reviewing these aspects side by side can help clarify which name currently offers a more attractive balance of risk and reward as the chip cycle evolves.
ADI Overview and Recent Performance
ADI, based in Wilmington, Massachusetts, develops analog, mixed-signal, and digital signal processing chips for industrial, automotive, communications, and consumer end markets. The company recently delivered record fiscal second-quarter 2026 revenue of $3.62 billion, a 37% increase from a year earlier. Industrial sales, which make up about half of total revenue, rose 56%, while communications revenue jumped 79%, with data center now representing more than 75% of that segment and expanding over 90% year over year. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Profitability metrics stood out, with adjusted gross margin reaching 73% and adjusted operating margin hitting 49%, both notably higher than the prior year. The firm also announced a $1.5 billion acquisition of Empower Semiconductor to strengthen its position in AI power management. Shares have held above their 50-day and 200-day moving averages over the longer term, though recent momentum signals point to some short-term moderation after the solid advance.
TXN Overview and Recent Performance
TXN, headquartered in Dallas, is the largest analog chip producer globally and also manufactures embedded processors and microcontrollers. It reported third-quarter 2026 revenue of $6.06 billion, up 28% year over year. Analog revenue reached $4.91 billion, climbing 32%, while embedded processing revenue grew 21%. Industrial revenue advanced more than 40%, automotive expanded at a mid-teens pace, and data center revenue surged about 95% year over year.
The company highlights its internal manufacturing capacity and 300mm wafer fabs as a key long-term edge. Gross margin improved to 64.2% and operating margin reached 47.5%, aided by higher revenue and better utilization rates. It raised its dividend 7% to $1.52 per share, extending a streak of increases to 23 consecutive years, and trimmed capital expenditures to a $2 billion to $3 billion range for 2026 to support stronger free cash flow.
Side-by-Side Comparison
While both firms lead in analog semiconductors, their approaches and growth trajectories differ meaningfully. ADI carries heavier weight in higher-margin industrial and communications areas, giving it greater exposure to data center and AI power demand; its 79% communications growth and over 90% data center expansion illustrate that focus. TXN, meanwhile, runs a broader, higher-volume portfolio across analog and embedded processing, with wider reach across a range of industrial and automotive customers.
On the profitability front, ADI holds an advantage with its adjusted gross margin near 73% compared with TXN’s 64%. TXN offsets this with greater scale, a sizable captive manufacturing footprint, and a consistent record of returning capital, highlighted by its extended dividend streak. Risk profiles vary as well: ADI’s acquisition of Empower Semiconductor brings execution and integration considerations alongside a potential future catalyst, whereas TXN carries higher fixed-cost exposure from its fabrication capacity as it navigates utilization through the cycle. Both stocks have delivered strong gains, yet ADI’s quicker revenue growth and sharper margin expansion have prompted more positive analyst updates in recent weeks.
Why the AI Verdict Favors ADI
Looking at factors such as trend consistency, growth momentum, margin expansion, and forward catalysts, the data points to a preference for ADI over TXN in the current comparison. ADI’s faster revenue growth, stronger gross and operating margins, and concentrated exposure to expanding data center and AI power markets suggest a more favorable relative position. The upcoming Empower Semiconductor acquisition adds another potential catalyst, though it also brings integration factors to consider. This view stems from probabilistic, data-driven analysis rather than a firm prediction, and the relative standing could change as each company’s results and market conditions develop.
Using Tickeron AI Tools in My Research
When reviewing names like these, I often consult Tickeron’s AI Trading Bots to see how automated strategies are currently positioned across similar tickers. It provides a useful layer of context on momentum and execution that complements the fundamental review. The platform draws from a broad set of bots and highlights those performing well in the present environment, which can help inform timing decisions without replacing core analysis.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
ADI in upward trend: price expected to rise as it breaks its lower Bollinger Band on November 05, 2026
ADI may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In 26 of 32 cases where ADI's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are 81%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator is in the oversold zone. Keep an eye out for a move up in the foreseeable future.
Following a +1.86% 3-day Advance, the price is estimated to grow further. Considering data from situations where ADI advanced for three days, in 203 of 324 cases, the price rose further within the following month. The odds of a continued upward trend are 63%.
The Aroon Indicator entered an Uptrend today. In 127 of 224 cases where ADI Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 57%.
Bearish Trend Analysis
The 10-day RSI Indicator for ADI moved out of overbought territory on October 07, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 34 similar instances where the indicator moved out of overbought territory. In 22 of the 34 cases, the stock moved lower in the following days. This puts the odds of a move lower at 65%.
The Momentum Indicator moved below the 0 level on November 05, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on ADI as a result. In 68 of 105 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 65%.
The Moving Average Convergence Divergence Histogram (MACD) for ADI turned negative on November 04, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 51 similar instances when the indicator turned negative. In 35 of the 51 cases the stock turned lower in the days that followed. This puts the odds of success at 69%.
ADI moved below its 50-day moving average on November 05, 2026 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ADI declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 57%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 14 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 80, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 56 (best 1 - 100 worst), indicating steady price growth. ADI’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 63 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 71 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (5.251) is normal, around the industry mean (5.443). P/E Ratio (42.923) is within average values for comparable stocks, (15.640). Projected Growth (PEG Ratio) (0.591) is also within normal values, averaging (3.803). Dividend Yield (0.012) settles around the average of (0.014) among similar stocks. P/S Ratio (12.804) is also within normal values, averaging (46.468).
The Tickeron Seasonality Score of 75 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron PE Growth Rating for this company is 79 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Advertisement
General Information
a manufacturer of integrated circuits used in analog and digital signal process
Industry Semiconductors
Advertisement