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Texas Instruments Shares Fall 6% as Weak Outlook Points to Extended Chip Market Slowdown

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Texas Instruments (TXN.O) shares dropped 6% on Wednesday after the chipmaker issued a disappointing forecast for the fourth quarter, warning of a prolonged slump in the analog semiconductor market. The bleak outlook has fueled fears that the chip industry’s long-awaited rebound could take longer than expected amid tariff uncertainty and sluggish industrial demand.

TI projected fourth-quarter revenue of $4.4 billion and earnings per share of $1.26, both falling short of analyst expectations. The company’s gross profit margin also slipped by 50 basis points from the previous quarter. Analysts say customers remain cautious about new capital spending, taking a “wait-and-see” approach as global trade and tariff rules remain unclear.

The company’s struggles highlight how geopolitical tensions and U.S. trade policies under President Donald Trump’s administration are weighing on the semiconductor industry. Though TI has reduced some of its exposure to tariffs through trade deals, the potential for new 100% semiconductor import duties has rattled confidence, even as domestic manufacturers are offered exemptions.

Brokerage firm Jefferies said it expects the rest of the Analog group to experience similar softness, while Charter Equity Research noted that weak customer demand and excess inventory could suppress margins for several more quarters.

Shares of other analog chipmakers, including On Semiconductor (ON.O), NXP Semiconductors (NXPI.O), and Analog Devices (ADI.O), also fell between 2% and 3% following the report. At least 16 brokerages cut their price targets for TI after the announcement, with the company poised to lose around $10 billion in market value if declines persist.

Despite a $60 billion investment plan to expand U.S. manufacturing, TI’s near-term outlook remains clouded by macroeconomic uncertainty and weaker industrial spending. Its stock has fallen 4% this year, trading at a 12-month forward P/E ratio of 29.05, above Analog Devices’ 26.24 — a sign investors remain cautious on its valuation amid the slowdown.

Wolfspeed Eyes Bankruptcy Filing Amid Debt Struggles and Weak Demand

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Wolfspeed, a leading U.S. semiconductor firm specializing in silicon carbide chips, is reportedly preparing to file for Chapter 11 bankruptcy within weeks, according to sources cited by The Wall Street Journal. The move comes as the company faces mounting debt, weakened demand, and heightened market uncertainty due to tariffs and macroeconomic pressures.

Shares of Wolfspeed (WOLF.N) plunged more than 57% in after-hours trading following the news.

The company, which serves industrial and automotive markets, has been wrestling with declining demand and recently rejected multiple out-of-court debt restructuring proposals. It is now seeking a court-supervised process with the backing of a majority of its creditors, as part of a pre-packaged bankruptcy strategy.

Earlier this month, Wolfspeed signaled financial distress by raising “going-concern” doubts and significantly lowering its revenue outlook. It forecast $850 million in revenue for fiscal 2026, falling short of analysts’ consensus of $958.7 million.

Wolfspeed declined to comment on the bankruptcy report when contacted by Reuters.

As one of the few major U.S. producers of silicon carbide chips — vital for electric vehicles and renewable energy systems — the company’s financial woes could ripple across the supply chain, especially as global chipmakers face persistent economic headwinds and shifting trade dynamics.