Capital management

Capital management

Our objective and the best metric to measure progress and generate long-term value for our owners is the growth of free cash flow per share. In 2020, free cash flow margin was 38% and since 2004, free cash flow per share grew 12% compounded annually.

Free cash flow per share


Our strategy to maximize free cash flow per share growth has three elements:

  • First, we have a great business model focused on analog and embedded processing products and built around four sustainable competitive advantages. In combination, our four competitive advantages provide tangible benefits, are difficult to replicate and ultimately separate us from our best peers. They are:
    • A strong foundation of manufacturing and technology
    • broad portfolio of analog and embedded processing products
    • The reach of our market channels
    • Diversity and longevity of our products, markets and customer positions
  • The second element of our strategy to maximize free cash flow per share growth is disciplined allocation of capital. This spans how we select R&D projects, develop new capabilities like, invest in new manufacturing capacity or how we think about acquisitions and returning cash to our owners.
  • The third element of our strategy is efficiency, which we think of as always striving to get more output per dollar of cost. This is about getting our investments (spending) in the most impactful areas to maximize the growth of long-term free cash flow per share; it’s not just about optimizing cost-cutting to get the last dollar of expense. As owners, you will see this focus on efficiency contribute to revenue growth, improved gross margins, disciplined R&D and SG&A expense, free cash flow margins and ultimately to free cash flow per share growth.

We will remain focused on the belief that long-term growth of free cash flow per share is the ultimate measure to generate value. To achieve this, we will invest to strengthen our competitive advantages, be disciplined in capital allocation and stay diligent in our pursuit of efficiencies.



capital management
Capital management
CFO Rafael Lizardi discusses our disciplined approach to capital management and sustainable business model
1m 49s
TI’s four competitive advantages
IR VP Dave Pahl shares how the advantages place TI in a unique class of companies
2m 10s
cap alloc
Capital allocation
CFO Rafael Lizardi shares our disciplined approach when allocating capital
2m 08s
Manufacturing and technology
IR VP Dave Pahl gives a deep dive on the elements and cost advantages
1m 55s
Capital management resources