Texas Instruments TXN is scheduled to report first-quarter 2025 results on April 23, after market close.

Texas Instruments expects earnings per share between 94 cents and $1.16. The Zacks Consensus Estimate for first-quarter earnings is pinned at $1.06 per share, which indicates a year-over-year decline of 11.7%.

The company anticipates revenues between $3.74 billion and $4.06 billion for the first quarter. The Zacks Consensus Estimate is pegged at $3.91 billion, suggesting growth of 6.7% from the year-ago period's reported figure.

TXN’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 8.9%.

Factors to Consider for Texas Instruments

Texas Instruments’ first-quarter performance is likely to be affected by the U.S.-China trade war and tariff hikes, as TXN is a major player in the United States and Chinese semiconductor market, with China accounting for more than 20% of its annual revenues in 2024.

Texas Instruments’ results are likely to be negatively impacted by the softness in its industrial and automotive end markets, which have consistently contributed to 70% of its annual revenues.

As TXN is increasing its Lehi factory in Utah, it will incur costs. Texas Instruments' rising manufacturing costs due to planned capacity expansions and decreased factory loadings are likely to have been a major headwind for the company’s business in the to-be-reported quarter.

It is anticipated that a declining demand environment, mostly brought on by customers cutting back on inventory, is likely to have a detrimental effect on the Analog and Embedded Processing segments' performance during the fourth quarter.

Nevertheless, Texas Instruments is expected to benefit from the recent grant awarded under the U.S. government’s CHIPS Act program. However, as the grant is earmarked for capacity expansion, its impact is long-term in nature and is unlikely to be reflected in the earnings of the to-be-reported quarter. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

What Our Proven Model Says for TXN’s Q1 Earnings

Our proven model does not conclusively predict an earnings beat for Texas Instruments this time. According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

TXN has an Earnings ESP of 0.00% and carries a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

ServiceNow NOW has an Earnings ESP of +1.96% and sports a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

It is set to report first-quarter results on April 23. The Zacks Consensus Estimate for NOW’s fourth-quarter 2024 earnings per share is pegged at $3.79, up by a penny over the past 30 days. NOW shares have risen 7% over the past year.

Lam Research LRCX has an Earnings ESP of +0.15% and flaunts a Zacks Rank #3 at present.

It is set to report third-quarter fiscal 2025 results on April 23. The Zacks Consensus Estimate for BILL’s third-quarter fiscal 2025 earnings is pegged at $1 per share, up by a penny over the past 60 days, indicating a rise of 28.2% from the year-ago quarter’s reported figure. LRCX shares have declined 26.3% over the past year.

Checkpoint Software CHKP has an Earnings ESP of +1.71% and carries a Zacks Rank #2 at present.

It is set to report first-quarter 2025 results on April 23. The Zacks Consensus Estimate for CHKP’s first-quarter earnings is pegged at $2.19 per share, unchanged over the past 60 days, indicating a rise of 7.4% from the year-ago quarter’s reported figure. CHKP shares have surged 35.4% over the past year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Texas Instruments Incorporated (TXN) : Free Stock Analysis Report

Check Point Software Technologies Ltd. (CHKP) : Free Stock Analysis Report

Lam Research Corporation (LRCX) : Free Stock Analysis Report

ServiceNow, Inc. (NOW) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research