Will Texas Instruments Stock Move On Its Forthcoming Earnings?

Texas Instruments (NASDAQ:TXN) is likely to report its earnings on Tuesday, October 21, 2025. Revenues are likely to grow by about 12% year-over-year to about $4.65 billion, per consensus estimates, while earnings are estimated to come in at about $1.49 per share. The anticipated growth comes as the semiconductor industry continues to rebound from a cyclical downturn, with demand stabilizing across automotive, industrial, and AI-related end markets.

More specifically, revenue will likely be driven by the company’s Analog and Embedded Processing segments. A key area to watch is its performance in the data center space — a relatively new but fast-growing opportunity for the company. In Q2, data center sales rose 50% year over year, supported by expanding AI infrastructure. Texas Instruments’ specialized semiconductor chips, which efficiently manage and distribute electrical power within data centers, are seeing strong uptake as hyperscalers invest heavily in next-generation compute systems.

Image by Pete Linforth from Pixabay

There are two ways to do that: understand the historical odds and position yourself prior to the earnings release, or look at the correlation between immediate and medium-term returns post earnings and position yourself accordingly after the earnings are released. That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 105% since its inception.

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Texas Instruments’ Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 20 earnings data points recorded over the last five years, with 6 positive and 14 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 30% of the time.
• However, this percentage decreases to 25% if we consider data for the last 3 years instead of 5.
• Median of the 6 positive returns = 4.8%, and median of the 14 negative returns = -4.0%

Additional data for observed 5-Day (5D) and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

1D, 5D, and 21D Post Earnings Return

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if the 1D post-earnings return is positive. Here is some correlation data based on a 5-year and a 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

Correlation Between 1D, 5D and 21D Historical Returns

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