Texas Instruments Stock Is Down 16% From Its 52-Week High. Is It a Buy?

Texas Instruments (TXN) has fallen 16% from its 52-week high despite posting Q2 revenue growth of 23% and earnings-per-share growth of 52%. The chipmaker doubled its data center revenue during the quarter, riding the AI infrastructure build cycle.

The sell-off followed Q3 guidance that came in below analyst expectations. Management attributed the soft outlook to timing of price increases rather than underlying demand weakness. The explanation hasn't stopped traders from rotating out of the stock.

TXN yields 2.1% and has raised its dividend for 22 consecutive years. The company continues to benefit from industrial demand alongside the ongoing AI infrastructure buildout. The Q2 results show TXN capturing share in data center chips, a category dominated by names like Nvidia but increasingly crowded with suppliers across the ecosystem.

The valuation compression creates a gap between operational execution—demonstrated by the Q2 beat—and forward guidance that spooked the Street. The question is whether the Q3 caution reflects conservative sandbagging ahead of year-end or genuine order-pattern shifts.