The dour third-quarter profit forecast contrasts with its earlier hopes for a strong rebound in chip demand, increasing concerns about tariff impacts and tempering investor confidence.

In response to analysts’ questions on a post-earnings call about whether tariffs were prompting customers to pull in orders and bumping up revenue, TI CEO Haviv Ilan said he “can’t rule out the possibility”.

“(TI’s) tone has shifted markedly vs last quarter’s call as well as vs management’s intra-quarter commentary, with seemingly more caution around the geopolitical and tariff environment,” said Bernstein analyst, Stacy Rasgon, adding that the shift “felt somewhat sudden”.

Chipmakers like TI are not directly affected by Trump’s higher tariffs yet, but rising costs for chip-making tools and reduced spending by some customers are starting to have an impact.

This was evident in the broader semiconductor industry, with both ASML, the biggest supplier of chip-making equipment globally, and TSMC, the world’s biggest chipmaking factory, last week, warned about tariff-related uncertainty.

“The impact of tariffs/trade is beginning to emerge and we anticipate a continuation of a slightly weaker than seasonal demand environment as the year progresses due to the impact of tariffs,” said analysts at JP Morgan.

Some analysts also expressed concerns about pressure to TI’s margins due to the company’s rising investments to expand its US manufacturing footprint.

Following the results, at least six brokerages cut price targets on the stock, while three raised, as per data compiled by LSEG.

The firm is up about 15%, while peer Analog Devices has gained around 11%, so far this year.

TI has a 12-month forward price-to-earnings ratio of 34.66, compared to Analog Devices’ 27.64.