Texas Instruments (TXN) DIvidends Date & History

Key Takeaways

• Texas Instruments offers a competitive dividend yield of 2.13% with quarterly payments of $1.42 per share.
• The company has raised its dividend for 22 consecutive years, showcasing strong commitment to shareholders.
• Payout ratio stands at 97.26%, reflecting a high distribution of earnings but supported by improving free cash flow.
• Next ex-dividend date is May 5, 2026, with payment on May 19, 2026.
• Dividend history dates back to 1962, positioning TXN as a reliable dividend growth stock in the semiconductor sector.
• Recent free cash flow improvements enhance long-term sustainability despite elevated payout levels.

Dividend Overview

Texas Instruments (TXN), a leader in analog and embedded semiconductors, maintains a robust dividend policy emphasizing both growth and sustainability. The company pays a quarterly dividend of $1.42 per share, equating to an annual payout of $5.68 and a current yield of 2.13%. This positions TXN as a dividend growth stock rather than a high-yield play, appealing to investors seeking consistent income paired with capital appreciation potential in the tech sector. Payments occur quarterly, with the next ex-dividend date set for May 5, 2026. Since initiating dividends in 1962, Texas Instruments has demonstrated discipline, raising payouts annually since 2004.

Dividend History and Growth

Texas Instruments boasts one of the longest dividend histories in the semiconductor industry, starting payments in April 1962. The quarterly dividend has grown remarkably from $0.02125 in 2004 to the current $1.42, reflecting compound annual growth. In 2025, the company announced a 4% increase to $1.42 per share, marking the 22nd consecutive year of raises. Over the past five years, dividend growth has averaged 8.13% annually. This streak underscores TXN's long-term strategy of returning cash to shareholders amid cyclical industry dynamics, with no cuts in its extensive history.

Dividend Sustainability and Payout Ratio

The payout ratio for TXN is 97.26% based on trailing twelve-month earnings, indicating nearly all profits are distributed as dividends. While elevated, this is supported by a fortress balance sheet, low debt levels, and recovering free cash flow (FCF). Recent quarters show FCF per share improving significantly, with Q1 2026 FCF at $0.92 and full-year targets exceeding prior lows. The FCF dividend payout ratio remains high at around 196%, but ongoing CapEx normalization post-expansion cycle bolsters coverage. Dividend safety scores remain strong, reflecting financial stability and consistent earnings power in analog chips.

Dividend Compared to Industry Peers

In the semiconductor sector, where many firms prioritize growth over dividends, TXN's 2.13% yield stands out as competitive. Peers like Intel (INTC) offer around 2.44%, Broadcom (AVGO) 2.12%, and Qualcomm (QCOM) similar levels, while high-growth names like Nvidia pay none. Analog-focused rivals such as Microchip Technology (MCHP) provide higher yields near 3.5%, but TXN excels in growth consistency and lower volatility, making its profile attractive relative to the industry average below 2%.

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Is This Stock Attractive for Dividend Investors?

Texas Instruments (TXN) appeals to dividend growth investors who prioritize reliable annual increases over sky-high yields. Its 22-year streak and 8% five-year growth rate suit long-term holders seeking compounding income in a defensive tech play. Conservative investors may appreciate the stability from diversified analog exposure across industrial, automotive, and consumer end-markets, buffering semiconductor cycles. However, the high 97% payout ratio warrants caution for those demanding ample earnings safety margins, as softer demand could pressure coverage. Income-focused portfolios might view the 2.13% yield as modest compared to utilities or REITs, but TXN's quality moat and FCF recovery enhance its role in balanced, growth-oriented dividend strategies. Overall, it fits moderately risk-tolerant investors balancing yield, growth, and sector resilience.

Disclaimer

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