By Trefis Team
Publication Date: 2026-09-25 14:27:00
Texas Instruments (TXN) and NVIDIA both sell chips for the data centers now being built. Data centers bring in nearly all of NVIDIA’s revenue, while TI sells to industrial and automotive customers as well as data centers. You pay 38.2 times the yearly profit for TI, yet only 28.1 times for NVIDIA. Their latest earnings calls show the two businesses parting ways on supply.
NVIDIA Is Short Of Supply, TI Is Not
NVIDIA’s data center revenue was $89 billion in fiscal Q2 2027, out of $96 billion in total. Management guided fiscal Q3 revenue to $108 billion, plus or minus 2%. That midpoint is about 12% above the Q2 total. Management expects supply to remain a bottleneck at least through the end of fiscal 2028.
TI guided Q3 2026 revenue to $5.65 billion to $6.15 billion, against $5.5 billion in Q2. TI’s data center sales doubled from a year earlier in Q2. Management said most of the Q3 growth will come from selling more units, not from higher prices. TI also has clean room space it can equip if demand keeps rising.
The two outlooks are different kinds of news. Demand for NVIDIA’s chips is larger than NVIDIA’s supply, so supply sets the pace. TI has spare room to make more, so demand sets TI’s pace.
Each company pays for its position. Memory prices rose more than NVIDIA expected, and NVIDIA reset its margin expectations. Gross margin is the share of sales left after production costs. NVIDIA guided it to 74% for fiscal Q3, down from 75% in Q2. NVIDIA…
