Texas Instruments (TI) designs, manufactures, and sells analog and embedded processing chips. Its products help over 100,000 customers manage power, sense, and transmit data and provide the control or processing for industrial, automotive, personal electronics, communications equipment, and enterprise systems.
The history
TI has a long and fascinating history, beginning in the early 20th century as an oil exploration company. It was originally founded in 1930 in Dallas, Texas, as Geophysical Service Incorporated (GSI) by J. Clarence Karcher and Eugene McDermott. The company initially focused on providing seismic exploration services for the oil and gas industry. However, during World War II, GSI shifted its operations to military electronics, producing radar equipment and other products to support the war effort. In 1951, the company was renamed Texas Instruments Incorporated after McDermott, Erik Jonsson, Cecil Green, and Pat Haggerty purchased it.
The 1950s marked a turning point as Texas Instruments transitioned into the burgeoning field of electronics. In 1954, the company developed the first commercial silicon transistor, a significant innovation that paved the way for its future in semiconductor technology. Just a few years later, in 1958, TI engineer Jack Kilby invented the integrated circuit (IC), an achievement that revolutionised the electronics industry and earned Kilby the Nobel Prize in Physics in 2000.
In 1967, TI further demonstrated its innovation by introducing the Cal-Tech, the first handheld calculator, which solidified its reputation in consumer electronics.
By the 1970s and 1980s, Texas Instruments had become a major player in defence electronics, semiconductors, and consumer products. During this time, the company ventured into the home
computing market with the release of the TI-99/4A computer in 1982. Although this product faced stiff competition from brands like Commodore and Apple, it showcased TI’s ambition to diversify its offerings.
Alongside this, the company focused heavily on semiconductors, developing microprocessors, digital signal processors (DSPs), and analog chips that were integral to the growing technology market. In the 1990s, TI began narrowing its focus, strategically concentrating on its semiconductor business. The company sold off its noncore divisions, including defence electronics and consumer products, to strengthen its position in the industry. A pivotal moment came in 1997 with the acquisition of Silicon Systems, which enhanced TI’s capabilities in analog and mixed signal processing.
Over the following decades, TI established itself as a leader in digital signal processing, a critical technology for applications like telecommunications, audio, and video processing. In 2011, TI acquired National Semiconductor, further solidifying its dominance in analog semiconductors.
Today, Texas Instruments is a global leader in semiconductors, specialising in analog chips and embedded processors. Its products are used in a wide range of industries, including automotive, industrial, healthcare, and personal electronics.
“For almost a century, each generation of our innovation has built upon the last to make our technology more reliable, more affordable, and lower power, making it possible for semiconductors to go into electronics everywhere,” noted Jason Raboy, Vice President of Operations, Texas Instruments.
Meeting the demands of the 21st century
TI’s 80,000 analog and embedded processing products are essential building blocks in all types of electronics systems.
“We strengthen and evolve this portfolio through investments in process and package technologies and new product development to address customers’ challenges and bring innovative features to the market,” said Raboy.
In 2023, TI invested about $1.9 billion in R&D to develop new products across hundreds of product categories. In addition, its work to build closer direct relationships with customers allows it to better service tens of thousands of customers. When it comes to purchasing, buyers today have more ways to automate how they source their products, including accessing real-time information about inventory, package types, pricing, and parametric details through APIs.
By connecting their own enterprise resource planning (ERP) systems directly to TI, many customers save significant time and effort because they can access real-time product information and automate their ERP systems to instantly purchase TI products. This automation makes it easier to get the products they need, exactly when and where they need them.
“We have invested in simplifying the procurement process for our customers, from order placement to delivery, with greater control and flexibility. Our automated distribution centres are strategically located near our customers’ production and design sites, as well as near major airports in multiple countries, to enable fast delivery of all TI products,” said Raboy.
Frankfurt Product Distribution Centre (PDC)
At the end of 2024, TI announced the opening of a Frankfurt Product Distribution Centre (PDC), which aims to meet rising demand with faster, more reliable, and flexible customer support.
This new distribution centre includes 9,000 square metres of space and new automation features. The new centre has the capacity to quickly ship up to 7,500 orders per day of a broad range of TI analog and embedded processing semiconductors across Europe. This new distribution hub triples TI’s capacity in the region, providing room for current and anticipated demand.
Located near many of TI’s industrial and automotive customers, as well as the Frankfurt Airport, the new distribution centre enables faster product delivery in Europe. The pick, pack, and ship process is fully automated and orders are ready to ship within 15 minutes or less.
Customers in central Germany can expect same-day product delivery, while next-day delivery is available to customers in most European countries.
“Our goal is to create a faster, more flexible supply chain that helps buyers plan confidently and adapt to evolving industry challenges,” stated Raboy.
Investment from the Chips and Science Act
TI was recently awarded up to $1.6 billion in direct funding through the US CHIPS and Science Act. The funding will help support three of TI’s new 300mm wafer fabs currently under construction in Texas and Utah. Support from the CHIPS Act, including the 25% investment tax credit, will help TI provide a geopolitically dependable supply of essential analog and embedded processing semiconductors.
“As the largest analog and embedded processing semiconductor manufacturer in the US, TI is uniquely positioned to provide dependable, low-cost 300mm semiconductor manufacturing capacity at scale,” said Haviv Ilan, President and CEO of Texas Instruments. “The increasing number of electronic devices in our lives depend on our foundational chips, and we appreciate the support from the US government to make the semiconductor ecosystem stronger and more resilient.”
The CHIPS Act direct funding will support TI’s investments through 2029 for three large-scale 300mm wafer fabs in Sherman, Texas (SM1 and SM2), and Lehi, Utah (LFAB2). Together, these fabs will manufacture tens of millions of analog and embedded processing chips every day.
Sustainability goals
“We take pride in our commitment to being a good corporate citizen, with a long-standing commitment to responsible, sustainable manufacturing that includes programmes and goals focused on conserving natural resources, reducing consumption, and mitigating environmental impact,” said Raboy.
TI drives sustainable and responsible business practices throughout its supply chain, from policies and strategies related to environmental and social responsibility across the supply chain, to the responsible sourcing of minerals for its products.
Guided by multi-year goals, the company is committed to reducing its environmental impact and invest in hundreds of projects every year aimed at reducing energy, material, and water consumption and greenhouse gas (GHG) emissions. These include using advanced manufacturing tools and technologies; signing multi-year solar and wind power contracts to deliver renewable electricity in Texas; and installing a solar roof at its site in Bangalore, India.
TI also packs and ships products efficiently to reduce environmental impact. It reduces and reuses various packing and shipping materials and works to leverage recyclable packaging materials.
Keeping an eye on inventory
“Our inventory objectives are to maintain high levels of customer service and keep lead times competitive and stable,” noted Raboy.
A key element of TI’s inventory management approach is how it invests in internal manufacturing to help ensure it meets demand. Internal manufacturing and technology provide the company with tangible benefits of lower manufacturing costs and greater control of its supply chain, which has been of growing strategic importance. Its internal wafer manufacturing and assembly and test operations are growing to support more than 95% of its production by 2030.
Additionally, TI is investing and increasing capacity in 45 to 130nm nodes to meet the critical and long-term need for foundational analog and embedded processing chips which are essential for the industrial and automotive markets. All of these investments allow the company to provide geopolitically dependable capacity for customers, with equipment and process technologies that last for decades, boost supply chain resilience, and enable TI to provide competitive lead times.
Why should you buy from TI?
“Procurement professionals rely on suppliers for a steady, reliable product supply. We make it easy for buyers to select the parts they need from the broadest and most diverse portfolio of analog and embedded processing products in the industry. TI prioritises speed, flexibility, and efficiency through automation and strategic inventory management. We offer direct and immediate access to small quantities for testing and rapid fulfilment of production-scale orders, saving valuable purchasing time and efforts. Finally, we provide fast, reliable delivery with multiple product distribution centres across the world, so you can go to market faster,” concluded Raboy.
This article originally appeared in the Jan/Feb issue of Procurement Pro.
