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When Texas Instruments announced a $60 billion manufacturing megaproject in July, it was a bold bet that companies would want to mass produce foundational microchips on U.S. soil. In August, Apple vowed to do just that. During the same Oval Office press conference where President Donald Trump announced a 100% tariff on chips from companies not manufacturing in the U.S., Apple CEO Tim Cook upped his companies' U.S. spending commitment to $600 billion over the next four years, up from an original $500 billion announcement in February. Part of that spending, Cook said, will go toward making "critical foundation semiconductors" for iPhones and other devices at Texas Instruments' new chip fabrication plants in Utah and Texas. In July, CNBC became the first news organization to see the inside of TI's newest fab in Sherman, Texas. There, full production is on schedule to start by the end of 2025. It's one of seven new factories the chipmaker is building in the U.S. to provide chips to major customers like Nvidia, Ford Motor, Medtronic and SpaceX. Although Texas Instruments doesn't make the world's most advanced chips, its essential components are found almost everywhere, from smartphones to the graphics processing units powering generative AI. "If you have anything that plugs into the wall, or has a battery in it, or has a cord in it, you probably carry more than one TI chip in it," said Mohammad Yunus, TI's senior VP of technology and manufacturing. But just one month after TI announced the $60 million project, its shares plummeted 13% following weak guidance and tariff concerns raised in its July 23 earnings call. "The worry is their end customers. Like in the wake of tariff uncertainty, they don't know what to expect. Are they stockpiling?" said Stacy Rasgon, senior analyst at Bernstein Research. It remains to be seen whether demand will remain high once tariff uncertainties calm. Still, shares did recover some ground in August. "I would position them as more of a tariff winner than a tariff loser," said Timothy Arcuri, managing director at UBS. Arcuri said TI's U.S. foundry will allow it to undercut the pricing of its rivals' Taiwan-made chips. The market for TI's chips, however, is not a guarantee. After TI had trouble keeping up with demand during the chip shortage in 2020, Arcuri said TI's share of the analog market "fell off a cliff." It went from a high of 19.8% in 2020 to a low of 14.7% in 2024, according to UBS. TI's $60 billion megaproject includes four fabs in Sherman, Texas, one in Richardson, Texas, and two in Lehi, Utah. The new fabs will give TI five times the capacity it has today, Yunus told CNBC. "They're making a big bet on the fact that they regain share and that demand comes rocketing back," Arcuri said. "If you don't regain that share, it's hard to justify building this much capacity."
SM1 and SM2, the first two of four new chip fabrication plants being built by Texas Instruments in Sherman, Texas, shown on July 24, 2025. Graham Merwin
Ramping to 300mm
While TI is well known for its graphing calculators, the company is also responsible for helping revolutionize the electronics industry. In 1958, TI engineer Jack Kilby filed the first patent for an integrated circuit. That paved the way for miniaturizing chips by building all the components of a circuit, not just the transistors, directly into a single piece of silicon. The majority of TI's business today comes from automotive and industrial customers that buy the company's analog and embedded chips. Analog chips process signals like sound, light and pressure, like the temperature on a thermostat or voltage on power management chips that keep electronics safe when plugged in. Embedded chips are typically signal processors and microcontrollers for operating everyday devices, like telling the toaster to ding, the dishwasher to end a cycle or anti-lock brakes to engage. Unlike the costly bleeding edge 2 and 3 nanometer chips made by giants like TSMC, TI's chips are made on cheaper, legacy nodes: 45 to 130 nanometers. That size "is the sweet spot for analog and embedded because they provide the right performance, the power, the voltage that our portfolio needs," Yunus said. While each TI chip costs about $0.40, according to Arcuri, they play crucial supporting roles for the world's most advanced technologies. In a new partnership with Nvidia , for example, TI is developing a chip to drive efficiency in power-hungry data centers. In 2009, TI made another bold move to help bring the cost of its chips down further. It opened the world's first 300 millimeter fab for analog chips, re-purposing a memory fab from Qimonda after the chipmaker went bankrupt in the financial crisis. "That's what really was the catalyst for TI to have such a cost advantage," Arcuri said. The new wafer size gives TI "tremendous cost efficiency" because 300mm can fit "2.3 times more chips in it versus a 200mm wafer," Yunus said. TI's been closing and selling off some of its 200mm fabs, and all of its seven new fabs will produce on 300mm wafers.
Texas Instruments senior VP of technology and manufacturing Mohammad Yunus talks to CNBC's Katie Tarasov in the first of TI's four new chip fabrication plants in Sherman, Texas, on July 24, 2025. Graham Merwin
Global supply, Texas growth
TI told CNBC it's the country's biggest analog and embedded semiconductor manufacturer, selling tens of billions of chips each year. About 60% of revenue comes from customers based outside the U.S., with China making up about 20%. About 75% of TI's capital spend happens in the U.S., but it also makes chips abroad at fabs in Germany, Japan and China, the company told CNBC. It does testing and assembly in Mexico, Taiwan, the Philippines and Malaysia, where it's spending $3 billion on two new sites, one of which is now in production. TI's global footprint is a benefit in the "dynamic situation" of tariffs right now, Yunus said. "Our manufacturing across 15 different sites provides us the position to be able to support our customers, no matter where they are and in any political or economic environment," he said. Although TI considered building its new sites internationally in places like Singapore, the company ultimately settled on Sherman, Texas. The small city 65 miles north of Dallas has a population of just 50,000 people. It's also home to a GlobalWafers factory. The Taiwan-based company manufactures the bare silicon wafers that chips, including TI's, are made on. Sherman Mayor Shawn Teamann said the city is now "the hub of the Silicon Prairie." Teamann's grandfather worked alongside Kilby at TI in the 1950s. TI first came to Sherman in 1966, but when it announced plans to close its outdated 150mm fab, the city enticed TI to stay with incentives like tax breaks and water discounts. The plan worked, and in 2021, TI announced it would stay in Sherman with a campus of new 300mm fabs. Now, the first of four 300mm fabs is complete in Sherman. Teamann said the 300mm project has more than doubled the city's rate of population growth since it was announced in 2021. As for federal support, TI got $1.6 billion of CHIPS Act funding, and a whopping 35% investment tax credit from Trump's big bill passed in July. At the state level, Gov. Greg Abbott has long offered incentives to chip companies willing to build in the state, from low taxes to the $1.4 billion Texas CHIPS Act passed in 2023. Samsung is the other chip giant in Texas since 1996. The South Korean company is building a $17 billion advanced chip fab near Austin. That's also where Apple , Amazon and AMD design many of their chips. Other chip companies in Texas include Infineon, NXP, X-Fab , Micron , GlobalFoundries , and tool supplier Applied Materials .
Water, power, workers