AMD vs. TXN: Analyzing Chip Stocks for 2026

Advanced Micro Devices ($AMD+WL) and Texas Instruments ($TXN+WL) are being evaluated as potential long-term investments amidst the maturation of the artificial intelligence boom. $AMD+WL, with a reported fiscal 2025 revenue of $34.6 billion, up 34% year-over-year, and a net income of approximately $4.3 billion, targets high-performance computing and gaming sectors. The company has strategic agreements for advanced graphics units and long-term deals with major players like Sony and Microsoft, though this concentration introduces a risk element.

In contrast, Texas Instruments has reported revenue of $17.7 billion for fiscal 2025, marking a 13% increase from the prior year, with a net income of $5 billion and a net margin around 28%. $TXN+WL operates predominantly in the analog chip market, serving industrial and automotive applications, which offers a different growth dynamic compared to $AMD+WL's more volatile, high-growth segment.

$AMD+WL's operational cash flow was significantly influenced by stock-based compensation, representing about 21.2% of the flow, while free cash flow reached approximately $6.7 billion. The company's gross margin stands at 50.37% with a P/E ratio of 131.53 and an EPS (TTM) of $3.90. Texas Instruments reports a gross margin of 58.33%, a P/E ratio of 39.66, and an EPS (TTM) of $6.57, with a dividend yield of 2.18% on its shares trading around $512.50.

Intense competition from Intel and Nvidia, alongside reliance on foundries like TSMC, are key considerations for $AMD+WL. Texas Instruments, meanwhile, recently acquired Silicon Laboratories.