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Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

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Page 1: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th
Page 2: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

TI at a glance

Markets

Analog and Embedded Processing

Financials

Innovation

University and student

engagement

Manufacturing

Our commitment and values

Menu

Page 3: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

TI at a glance

Page 4: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Global semiconductor design and manufacturing

We design, manufacture, test and sell semiconductor chips

Page 5: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Technologies that improve how we live our lives

Industry’s broadest and most

diverseportfolio of

Analog and Embedded Processing products

used by approximately

100,000of the world’s most

innovative companies

Page 6: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Diverse and global workforce

Almost

30,000employees in more than countries30

Page 7: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Diverse and global workforce

Almost

30,000employees in more than countries30

• Increases flexibility• Fosters problem solving• Fuels innovation

Page 8: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

2016 Revenue $13.37 billion

$8.54 billion Analog $1.81 billion

Other

$3.02 billion Embedded Processing

Focus on Analog and Embedded Processing

More than 85 percent of TI’s revenue comes from Analog and Embedded Processing

Page 9: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

A history of great invention through the years

1930s

Oil exploration

Processors

Defense systems

Analog and Embedded Processing Applied research in Kilby Labs

Integrated circuit

1970s-’80s 2000 to present

1940s 1950s

Page 10: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Products for a broad set of applications and markets

Communications equipment Personal electronics

Industrial

Automotive

Enterprise systems

Page 11: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Global manufacturing

Innovative processes, flexible operations and high quality resultsto support customer demand

Page 12: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Core values

TI’s core values ofintegrity, innovation and commitment are woven throughout our DNA

Page 13: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Corporate citizenship

Our commitment to do the right thing permeates all aspects of our culture

Page 14: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovation and R&D

More than$7 billion investedin the past

5 years*

TI has more than

44,000patents

*2012-2016

Page 15: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovation and R&D

More than$7 billion investedin the past

5 years*

In areas such as:

Product development

R&D labs

Manufacturing technology

*2012-2016

Page 16: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Analog & Embedded Processing

semiconductor solutions

Page 17: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Solutions for all markets

Enablingendless applications

Industrial

Automotive

Personal electronics

Enterprise systems Communications equipment

Page 18: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Analog and Embedded Processing make electronics work

Gather information from the real world

Page 19: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Analog

Industry’s No. 1 analog supplier* with the broadest and most comprehensive portfolio of products

*IHS 2016

Page 20: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Embedded Processing

Full-system design expertise with differentiated embedded processing hardware and software

Page 21: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Global application expertise and support, anytime and anywhere

TI Designs reference designsMore than 2,000 TI Designs to

jumpstart system plans

TI E2ETM CommunityMore than 1.5 million questions and

answers at your fingertips

TI Store24/7 tool sales and

silicon sales

Sales supportIndustry’s largest salesand applications force

TrainingOnline and in-person

customer training

WEBENCH®

Online design tools deliver custom results in seconds

Technical documentsComprehensive technical

documentation available online

Page 22: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Continued investment in Analog and Embedded Processing

Expanding TI’sproduct portfolio

Helping customers solve design challenges

Page 23: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovation

Page 24: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovative technology that meets our customers’ needs

Delivering differentiated products that are: • Smarter

• Faster

• More efficient

• Lower power

Page 25: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Research and development

• Systems and applications labs

• Kilby Labs

• University partnerships

Page 26: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Celebrating our people

We foster a culture of innovation

Page 27: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Manufacturing

Page 28: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Global manufacturing

• Innovative processes

• High-quality results

• Flexibility

15 manufacturing sites in 9 countries

Page 29: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovative manufacturing processes

• High-speed

• High-precision

• High-voltage

• High-density

• Low-power

Producing analog technologies that are:

Page 30: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Innovative manufacturing processes

Our approach to manufacturing and differentiated processing technologies is a competitive advantage. This includes our investment in 300mm Analog capacity.

Page 31: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Responsive manufacturing capacity

RFAB is the industry’s first and largest fab in the world dedicated to analog technology on 300mm wafers.

About $8B of total 300mm Analog

capacity

Page 32: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Quality and reliability of our chips

Ensuring our products operate

at or beyond our customers’

performance requirements

Page 33: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Safe and sustainable operations

Meeting our customers’ needs through sustainable operations

One of the best U.S. safety records*

in the semiconductor industry

* SIA I&I survey 2013

Page 34: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Financials

Page 35: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

2016 Revenue $13.37 billion

$8.54 billion Analog $1.81 billion

Other

$3.02 billion Embedded Processing

Strategic focus on Analog and Embedded Processing

We grow, generate and return cashto our shareholders

Page 36: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

0 5 10 15 20 25 30 35

Acquisitions

Dividends

Share repurchases

R&D, Sales/Mkgt, CapEx, Inv 32

25

9

7

Capital over 10 years(2007-2016)

$ Billions

Disciplined capital allocation drives long-term value, competitiveness

• $73B of capital allocated over the past 10 years

• Drives long-term value, competitiveness, continued free cash flow per share growth

• Impacts shareholders returns

*Free cash flow = Cash flow from operations less capital expenditures

Page 37: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Looking forward: R&D investments strengthen portfolio, drive future growth

• Disciplined R&D investments allocated to higher value and growth opportunities

• Focused investments on industrial and automotive produce results: today comprise about 51% of TI revenue

Page 38: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Strategic decisions drivefree cash flow growth including: • Approach to technology and

manufacturing • Broadest product portfolio • Reach of market channels • Long-lived and diverse products

Generate cash

In 2016, free cash flow (FCF)* increased to

$4.1B or 30.5% of revenue.

*FCF = cash flow from operations minus capital expenditures

Page 39: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

4Q16x42016201520142013201220112010200920082007200620052004

Dividends per share(in U.S. dollars)

0.089 0.105 0.13

0.30

0.41 0.45 0.490.56

0.72

1.07

1.24

1.40

1.64

2.00

Return cash

Committed to return all* of free cash

flow to shareholders through dividends and

share repurchases

*FCF plus proceeds from exercises of equity compensation less net debt retirement

Page 40: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

42% reduction in shares outstanding(in billions)

0.5

1.0

1.5

2.0

2016201520142013201220112010200920082007200620052004

Return cash

Committed to return all* of free cash

flow to shareholders through dividends and

share repurchases

*FCF plus proceeds from exercises of equity compensation less net debt retirement

Page 41: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Building a stronger TI

We are focused on strengthening our unique competitive advantages: • Approach to technology and

manufacturing

• Broadest product portfolio

• Reach of market channels

• Long-lived and diverse products and markets

Page 42: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Markets

Page 43: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Automotive systems

Key automotive sectors:

• Infotainment

• Passive safety

• Advanced driver assistance systems (ADAS)

• Body electronics and lighting

• Hybrid/electric vehicle and powertrain

Page 44: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Industrial systems

Industrial is broad and diverse. 14 sectors including: • Factory automation and control

• Medical, healthcare and fitness

• Building automation

• Grid infrastructure

• Test and measurement

• Motor drivers

with hundreds of end equipments

Page 45: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

From personal electronics to enterprise systems

Personal electronics Enterprise systemsCommunications equipment

Page 46: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

University faculty and student engagement

Page 47: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Bridging the gap between industry and academia

University engagements include:

• Coursework materials • Teaching labs • Student design inspiration • Research projects

Since 1982, TI has been bridging the gap between academia and industry with more than 8,000 teaching labs in engineering departments at 2,600 universities worldwide, 450 TI-based textbooks in 10 languages, reaching tens of thousands of students annually.

Page 48: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Bringing real-world engineering concepts to life for students

Resources students need for their maker mindset to thrive.

• Online tutorials • Design inspiration • Engineer-to-engineer

discussions • Products and tools to

enhance the learning experience

Page 49: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Supporting university professors

Teaching materials and resources to integrate into coursework: • TI-based teaching kits and labs • Analog • Embedded Processors • Power management • Products and tools

Page 50: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Employing the best and brightest

• Internships and rotation programs

• Early career and experienced professionals

• Technicians and operators

Page 51: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Our commitmentand values

Page 52: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Our commitment

Social Impact

Economic Impact

Environmental Impact

Citizenship is our commitment to be accountable for our social, environmental and economic impact aroundthe world

Page 53: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Investment in our people

We believe diversity fuels innovation because our people are our greatest assets

Page 54: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Operating sustainably

Responsible business practices are the foundation by which we operate

Page 55: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Environmental stewardship

Investment to reduce:

• Air emissions

• Energy consumption

• Water use

Page 56: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Stronger communities make stronger companies

Investment in our communities

* 2011-2016

Page 57: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Stronger communities make stronger companies

Involvement through volunteerism

Employees serving in nonprofit leadership roles

Volunteer hours valued at $3.2m in 2016* (estimated)

400+

140k

*As of 11/15/2016

Page 58: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Connecting future engineers to STEM

More than$150 million

invested in education, including K-16 science, technology, engineering

and math (STEM) programs

Page 59: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Connecting future engineers to STEM

More than$150 million

invested in education, including K-16 science, technology, engineering

and math (STEM) programs

Enabling: • K-12 and university programs • Curriculum, technology and tools • Employee volunteering

and mentoring • Underrepresented groups to

learn more about STEM and engineering careers

Page 60: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Company CR Magazine, “100 Best Corporate Citizens”(14th year)

Ethisphere Institute, “World’s Most Ethical Companies” (10th consecutive year)

Fortune, “World’s Most Admired Companies” (3rd in industry)

Employer Forbes, “America’s Best Employers”

Human Rights Campaign, inclusion in the Corporate Equality Index rating LGBT workplace equality (13th year)

CareerBliss, “50 Happiest Companies in America” (5th year)

Financials indicesand ratingsDow Jones Sustainability Indices, “North America Component” (10th year)

FTSE Group, “Constituent,” FTSE4Good, a responsible investment index series (4th year)

Safety and healthBritish Safety Council, “International Safety Award” for best in class in the manufacturing sector

Malaysian Society of Occupational Safety and Health Awards, “Gold Class,” recognizing TI Malaysia and TI Electronics Malaysia

National Safety Council, “Perfect Record Award,” recognizing RFAB

2016 Awards

Page 61: Analog and - s3. · PDF file*FCF plus proceeds from exercises of equity compensation less net debt retirement. Building a stronger TI ... CR Magazine, “100 Best Corporate Citizens”(14th

Q&A