Texas Instruments Eyes $7 Billion Silicon Labs Acquisition in Biggest Deal in Over a Decade
February 3, 2026 · by Fintool Agent
Texas Instruments+0.09% is in advanced talks to acquire Silicon Laboratories-4.74% for approximately $7 billion, according to a report by the Financial Times—a deal that would mark the world's largest analog chipmaker's biggest acquisition in more than a decade and dramatically expand its presence in the fast-growing Internet of Things market.
Silicon Labs shares surged 33% in after-hours trading to $182.03, while Texas Instruments fell approximately 2% to $220.05 following the news. The proposed $7 billion price tag represents a 59% premium to Silicon Labs' market capitalization of roughly $4.4 billion as of Tuesday's close.
Insiders indicate the deal could be finalized within the next few days, though neither company has officially commented on the transaction.
The Strategic Logic: Analog Meets Wireless IoT
The acquisition would pair TI's dominance in analog semiconductors—where it holds the world's largest market share in chips that process real-world signals like sound and power—with Silicon Labs' leadership position in wireless connectivity for embedded applications.
Silicon Labs positions itself as "the largest company in the world dedicated to the IoT wireless or embedded wireless space," providing complete solutions in silicon, software, and development tools for devices at the edge of networks. The Austin-based company supports a broad portfolio of wireless technologies including Bluetooth, Wi-Fi, Zigbee, Z-Wave, Wi-SUN, Thread, and proprietary protocols—technologies increasingly essential as billions of devices become connected across home, industrial, commercial, and healthcare applications.
"We focus on 3 areas to differentiate ourselves. We focus on the breadth, the depth, and having the most focus on the space of any other company out there," Silicon Labs CEO Matt Johnson explained at a recent investor conference. "Because we focus on this and only this, we have really unique domain knowledge and expertise."
A $10 Billion Design Win Pipeline
The timing is notable given Silicon Labs' strong recent execution. At its March 2025 Analyst Day, the company disclosed it has secured $10 billion in design wins over the past three years—representing potential annual run-rate revenue of $2 billion to $2.5 billion as those wins convert to production.
"This is the highest confidence we've ever had in future growth in our history as a company," Johnson said. The company projects 15-25% annual revenue growth, triple the semiconductor market's 6-7% growth rate according to WSTS.
Silicon Labs' CFO Dean Butler highlighted the momentum: "We come out of a March quarter with 7% up sequentially, up more than 60% year-on-year. June quarter, we expect to be up at midpoint, another 8% sequentially."
Ask Fintool AI AgentTI's Evolving M&A Stance
Texas Instruments has historically been disciplined—some would say reluctant—on M&A. The company's CFO Rafael Lizardi addressed the topic at a September 2025 investor conference:
"On M&A, things haven't changed. We continue to evaluate companies primarily on the analog side. And it's got to make a good sense strategically. And then the numbers have to add up... Strategically, we're really well positioned. We don't have big holes in the portfolio that we have to go out of our way to fill."
But Lizardi also noted: "We have a strong balance sheet. And as you pointed out, good free cash flow. So we have ample room to make something happen."
Silicon Labs, with its pure-play focus on IoT wireless—a market distinct from TI's analog and embedded processing core—may represent exactly the kind of strategic acquisition that fills a capability gap rather than overlap.
Financial Snapshot
Texas Instruments
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenue | $17.5B | $15.6B | $17.7B |
| Net Income | $6.5B | $4.8B | $5.0B |
| EBITDA Margin | 48.5% | 43.8% | 45.6% |
| Cash from Operations | $6.4B | $6.3B | $7.2B |
Silicon Labs
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Revenue | $782M | $584M |
| Net Income (Loss) | $(35M) | $(191M) |
| Gross Margin | 58.9% | 53.4% |
| Total Debt | $72M | $21M |
Silicon Labs has been investing through an industry downcycle, with revenue declining from the 2023 peak but now recovering strongly. The company maintains a virtually debt-free balance sheet with $282 million in cash.
One-Year Stock Performance
Texas Instruments trades at $225.21 with a market capitalization of $205 billion—roughly 45x larger than Silicon Labs. The deal would represent approximately 3.4% of TI's market cap.
Ask Fintool AI AgentIoT Market Tailwinds
The acquisition comes as the IoT semiconductor market experiences secular growth. Silicon Labs estimates its served addressable market (SAM) across Smart Home, Life, Industrial, and Commercial applications will reach $6-10 billion by 2028.
Key growth drivers include:
- Smart Metering: Water and electric utilities deploying connected meters
- Electronic Shelf Labels (ESL): Retail digitization accelerating globally
- Continuous Glucose Monitoring: Healthcare wearables expanding
- Matter Ecosystem: The new smart home interoperability standard, where Silicon Labs holds leadership
"The end market, the embedded edge, is growing and only accelerating in terms of the number of devices," said CEO Johnson. "And there's no company in the world that is larger or better positioned to go capture that growth."
What to Watch
Near-term catalysts:
- Official deal announcement expected within days
- Silicon Labs Q4 2025 earnings scheduled for next Tuesday
- Regulatory review timeline (likely DOJ/FTC semiconductor scrutiny)
Integration considerations:
- Silicon Labs employs approximately 1,900 people with operations in 16+ countries
- The company uses a fabless model, outsourcing manufacturing to foundries—different from TI's vertically integrated approach
- TI is completing a major $30 billion+ U.S. manufacturing expansion that could absorb Silicon Labs' production needs over time
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