Texas Instruments Incorporated (TXN) is a Dividend Powerhouse in Tech

Texas Instruments Incorporated (NASDAQ:TXN) is one of the 10 Technology Dividend Aristocrats to Buy in 2025.

Texas Instruments Incorporated (NASDAQ:TXN) is an American semiconductor company that specializes in analog and embedded chips. The company has been focused on disciplined capital allocation over the past year. This includes ramping up spending on R&D and expanding its production facilities, all while aiming to maintain stable free cash flow. Thanks to this balanced approach, the company has managed to increase its dividend in a measured and sustainable manner over the years.

A robotic arm in the process of assembling a complex circuit board – showing the industrial scale the company operates at.

Texas Instruments Incorporated (NASDAQ:TXN)  is widely regarded as a reliable dividend payer, supported by strong cash generation, a historically low payout ratio, an attractive yield, and consistent dividend growth. Over the trailing twelve months, the company reported $6.2 billion in operating cash flow and $1.7 billion in free cash flow, with free cash flow accounting for 10.7% of its total revenue. During the same period, Texas Instruments returned $6.4 billion to shareholders through dividends. While its payout ratio currently exceeds 100% on a TTM basis, the five-year average stands at 66%, pointing to a strong and stable financial foundation.

Despite significant investments in both R&D and capital expenditures, the company has continued to raise its dividend over the years, reflecting the resilience of its cash flow. Currently, Texas Instruments Incorporated (NASDAQ:TXN) pays a quarterly dividend of $1.36 per share, unchanged from its prior payout. Its most recent increase came in September 2024, marking the 21st consecutive year of dividend growth. With just four more years to go, the company is on track to join the ranks of Dividend Aristocrats. Its dividend yield comes in at 2.74%, which is higher than the average yield of tech stocks.

While we acknowledge the potential of TXN as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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