Global analog chip leader Texas Instruments (TI) has reportedly begun a new round of workforce reductions in its China operations, sources familiar with the matter say. The latest layoffs affect core technical and support roles, including Field Application Engineers (FAEEs) who directly interface with customers, raising questions about TI's local technical service capabilities. TI China has not publicly commented on the planned adjustments.

This move follows a series of prior reductions. Between 2022 and 2023, TI's China MCU R&D teams were largely relocated abroad, retaining only marketing and application support. In 2024, approximately 50 employees in Beijing's low-end power IC R&D team were laid off. Unlike previous rounds that focused on R&D, the current cuts target FAEE positions—critical links between products and customers—signaling potential further adjustments to TI's local support strategy.

Industry analysts attribute the layoffs to TI's ongoing global restructuring and the cyclical downturn in the semiconductor market. In 2024, TI's revenue declined 11% year-on-year, while net profit fell 26%. Weak demand in the industrial and automotive segments, which account for 70% of TI's sales, resulted in underutilized capacity and inventory pressure. First-quarter 2025 forecasts suggest further revenue contraction and earnings pressure, prompting the company to optimize operational efficiency through cost management.

Globally, TI has been adjusting its capacity while expanding in high-priority regions. The company recently secured $1.61 billion under the U.S. CHIPS and Science Act to accelerate a new wafer fab in Utah. Sources indicate that the China layoffs mirror TI's broader strategy to focus on high-margin product lines and optimize resource allocation worldwide. Domestic competitors in analog and embedded segments have also intensified, adding pressure to lower-end product lines in China.

The workforce adjustments come amid broader scrutiny of TI in China. On September 13, the Chinese Ministry of Commerce launched an anti-dumping investigation into imported U.S.-made analog chips, including TI products. The probe covers commodity interface ICs and gate driver ICs using 40nm or larger process nodes. Preliminary evidence submitted by the Jiangsu Semiconductor Industry Association suggests U.S. product prices dropped by more than 50% on average during the investigation period, with some segments exceeding 55%, while exports to China saw dumping margins over 340%.

The association noted that domestic analog chip suppliers have improved output, quality, and service, increasingly replacing imported products. It argued that TI's low-price strategy, aimed at capturing market share, has negatively impacted the local industry and may continue to cause harm if anti-dumping measures are not enforced.

Following long-term price reductions, TI has recently raised prices to recoup margins. On June 15, TI adjusted prices for over 3,300 SKUs, and on August 4, it revised over 60,000 SKUs, with price increases ranging from 10% to 30%, including over 25% for key industrial and automotive components such as digital isolators and isolation drivers. These adjustments helped TI achieve a strong Q2 2025 performance, with revenue of $4.45 billion (up 16% year-on-year, 9% quarter-on-quarter) and operating profit of $1.56 billion (up 25% year-on-year).

While price adjustments have restored profitability for TI, the broader impact on China's analog chip sector remains a concern, pending the outcome of the Ministry of Commerce's anti-dumping investigation. Analysts warn that if industrial and automotive demand does not recover in the second half of 2025, further workforce optimizations across the sector may be inevitable.