Texas InstrumentsTXN -0.28%81 Operating Margin % is 37.82% as of Mar. 2026, which is 10% below its 10-year median of 42.07. GuruFocus rates TXN with a GF Score™ of 81/100 and a GF Value™ of $212.39 (Significantly Overvalued). The stock has 10 warning signs investors should review. Among 1,023 Semiconductors companies, Texas Instruments ranks better than 96.19% on this metric.
Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.
Be Aware
Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).
If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.
For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokias Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).
Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.
Texas Instruments Operating Margin % Related Terms
Texas Instruments Operating Margin % Historical Data
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The historical data trend for Texas Instruments's Operating Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
TXN vs QCOM, ADI, MRVL: Operating Margin % Comparison
For the Semiconductors subindustry, Texas Instruments's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Texas Instruments Operating Margin % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Texas Instruments's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Texas Instruments's Operating Margin % falls into.
Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.
Texas Instruments's Operating Margin % for the fiscal year that ended in Dec. 2025 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Texas Instruments (TXN) has a Operating Margin % of 37.82% as of Mar. 2026. Operating margin is the ratio of total operating income to net sales. View historical data on Texas Instruments and its competitors. This is 10% below median its historical median of 42.07. Over the past decade, Texas Instruments' Operating Margin % has ranged from 34.15 to 51.91. According to the industry distribution chart, Texas Instruments ranks #39 out of 1023 companies in the Semiconductors industry, placing it in the top 3.8%.
Is Texas Instruments' Operating Margin % too high?
Texas Instruments' current Operating Margin % of 37.82% is 10% below median its 10-year median of 42.07. Over the past 10 years, this metric has ranged from a low of 34.15 to a high of 51.91. The Semiconductors industry median Operating Margin % is 5.18. Texas Instruments' value of 37.82% is 630.1% above this industry median. Based on the distribution chart, Texas Instruments ranks #39 out of 1023 companies in the Semiconductors industry, which is in the top quartile — a strong position relative to peers. Overall, Texas Instruments has a GF Score™ of 81/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Texas Instruments' Operating Margin % compare to QCOM and ADI?
According to the Semiconductors industry distribution chart, Texas Instruments ranks #39 out of 1023 companies for Operating Margin %. This places Texas Instruments in the top 4% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 5.18. Texas Instruments' value of 37.82% is 630.1% above this benchmark. Historically, Texas Instruments' own Operating Margin % has ranged from 34.15 to 51.91 over the past decade. While the company's 10-year median is 42.07 vs. the industry median of 5.18, Texas Instruments has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Operating Margin % for a Semiconductors company?
The median Operating Margin % among Semiconductors companies is 5.18, based on 1,023 companies in the industry. Companies in the top quartile (top 25%) have a Operating Margin % significantly above this median, while those in the bottom quartile fall well below. However, Operating Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Texas Instruments's current Operating Margin % of 37.82% is 630.1% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Operating Margin % mean?
A high Operating Margin % can signal that a stock is expensive relative to its fundamentals. Operating margin is the ratio of total operating income to net sales. View historical data on Texas Instruments and its competitors. For the Semiconductors industry, the median Operating Margin % is 5.18 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Texas Instruments's current Operating Margin % is 37.82%, which is 10% below median its own 10-year median of 42.07. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Texas Instruments stock overvalued right now?
Based on GuruFocus' analysis, Texas Instruments (TXN) is currently considered Significantly Overvalued. The stock's GF Value™ is $212.39, compared to a current price of $303.50 — trading 42.9% above its estimated fair value. The current Operating Margin % is 37.82%, which is 10% below median its 10-year median of 42.07 and 630.1% above the Semiconductors industry median of 5.18. Texas Instruments' overall GF Score™ is 81/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Operating Margin % calculated?
Operating Margin % is calculated from a company's financial statements. For Texas Instruments (TXN), the current Operating Margin % is 37.82% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Texas Instruments (TXN) Overvalued in 2026?
Based on GuruFocus' analysis, Texas Instruments stock appears to be overvalued.
The current stock price of $303.50 is trading 42.9% above its estimated GF Value™ of $212.39.
GuruFocus considers Texas Instruments to be Significantly Overvalued.
Key valuation signals for TXN:
Operating Margin %: 37.82% (10% below median its 10-year median of 42.07)
GF Value™: $212.39 vs. price of $303.50 (42.9% above fair value)
Industry Position: 630.1% above the Semiconductors median (#39 of 1023)
No single metric tells the full story. See the TXN stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Dallas-based Texas Instruments generates over 95% of its revenue from semiconductors and the remainder from its well-known calculators. Texas Instruments is the world's largest maker of analog chips, which are used to process real-world signals such as sound and power. Texas Instruments also has a leading market share position in processors and microcontrollers used in a wide variety of electronics applications.
81GF Score
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