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Analog Devices (ADI) Q3 2025 Earnings Transcript
Image source: The Motley Fool. DATE Wednesday, August 20, 2025 at 10 a.m. ET CALL PARTICIPANTS Chairman, President, and Chief Executive Officer — Vincent Roche Executive Vice President and Chief Financial Officer — Richard Puccio Need a quote from a Motley Fool analyst? Email pr@ Full Conference Call Transcript Vincent Roche: Thank you, Rich, and a very good morning to you all. While our third quarter revenue and earnings exceeded our expectations, and for the second quarter in a row, we achieved double-digit year-over-year growth across all of our end markets. While geopolitical and macro uncertainty continues to cloud the outlook, we believe ADI's innovation-driven, resilient, highly diversified business model positions us to continue to successfully navigate these challenges. The accelerated recovery of our industrial business encompassing instrumentation, automation, healthcare, aerospace and defense, and energy management is a case in point. As you've heard us detail on prior calls, our industrial recovery began in the aerospace and defense, and instrumentation sectors, driven by our strong product and customer portfolio positions, as well as spending growth in defense and AI infrastructure. We're now seeing double-digit year-over-year growth across the entire industrial portfolio. For today's call, I'm going to focus on our billion-dollar-plus industrial automation business, which was the last sector to return to double-digit growth. Its market dynamics and trajectory are expected to bring long-term expansion. Companies have long invested in automation systems to gain first-order productivity efficiency and quality benefits. Today, a new wave of adoption is being driven by economic, demographic pressures and enabled by the potential to transform and accelerate business through leverage of real-time intelligent edge data. ADI's high-performance technology stack and deep domain expertise are crucial to customer success in this highly sensed, securely connected, software-driven era. And the new robotic modalities that are emerging, it's predicted that the convergence of compounding macro and AI-enabled technology factors will drive robust, double-digit growth within the robotics market for the foreseeable future. ADI's ability to deliver exceptionally accurate physical representations and enable faster insights at the edge will become even more essential as the market migrates to next-generation autonomous robotic systems. Our long history in robotics has given us a deep understanding of the sector's hardest problems and the greatest opportunities. We're investing to maintain our performance edge in analog while capturing increasing levels of system value. In addition, we're building ecosystem partnerships and deploying experts and an increasingly broad suite of technologies to enrich and deepen our customer collaborations. We expect this multipronged approach to unlock significant ASP and some expansion for our automation business, following the proven path we've successfully in other markets such as aerospace and defense and healthcare. Now let me share a few examples of our strategy in action. Earlier this year, we partnered with Teradyne Robotics. Our solutions for precision positioning and dynamic motion control are helping Teradyne increase their value proposition to the logistics industry through higher performance cobots and autonomous mobile robots or AMRs. In the agricultural sector, where labor shortages are chronic, high precision robotic systems are increasingly filling the gap. In addition, these systems' enhanced data collection capabilities are enabling higher crop yields while reducing water and chemical usage levels. A growing portion of our robotics revenue is coming from this sector, as we help customers solve their toughest challenges through our sensing, connectivity, and energy management solutions. In the healthcare sector, robot-assisted surgery systems minimize invasiveness and improve patient outcomes through enhanced system precision. And we're leveraging our leading precision technology franchise to successfully attach more of our power management, connectivity, and sensing content to the more innovative systems being designed and deployed. This year, we're achieving robust growth and expect continued momentum as the proliferation of automated surgical procedures further expands our opportunities in this space. Overall, the near and medium-term outlook for robotics is compelling, supported by increasing revenue and a burgeoning opportunity pipeline. From this strong foundation, extending into the next promising era of robotics, namely humanoid and other highly dexterous robot form factors, and creating a potentially exponential growth opportunity for ADI. Our content in a humanoid robot is likely to be several thousands of dollars, that's basically a 10x increase over the content in today's cutting-edge AMRs. The primary reason for this content multiplier is the explosion in sensor and actuator counts. Every joint and point of contact requires accurate sensing and precision motor control, and every sensor and actuator drives a signal chain and power management opportunity for ADI. To further capture this flourishing opportunity, we're investing in higher-level application-specific solutions that integrate multiple sensing modalities, such as pressure, vibration, depth, acoustics, vision, and positioning, with high accuracy, ultra-low power signal chains, functionally safe power management, and AI algorithms powered by robotics foundation models. Simultaneously, we're collaborating with NVIDIA on a range of digital twin simulation programs and reference designs for humanoid and other robotic systems to accelerate development and AI training for our customers. This work is particularly relevant for high-value applications such as dexterous manipulation of cable assemblies in data centers and, of course, in automotive manufacturing to name just one. We are combining ADI's unique sensor expertise and our latest advances in robotics policy training and techniques to enhance realism in NVIDIA's Isaac Sim and substantially shorten our customers' innovation timelines. So in summary, we're capitalizing on growth in advanced robotics today and investing to capture even more value in the future. Ultimately, the strategy, investments, and customer impact of our robotics business is a microcosm of our approach across ADI, namely uncovering and tackling the hardest innovation challenges at the intelligent physical edge and leveraging our industry-leading technology portfolio and expertise to solve them. As we turn our attention to the end of fiscal 2025 and the beginning of the new fiscal year, we're focused on executing our strategy and capitalizing on cyclical and idiosyncratic momentum. Despite the geopolitical and macro turbulence, we remain undeterred and excited by the tremendous growth opportunities that we see over both the near and long terms. And with that, I'm gonna pass it back to Rich. Richard Puccio: Thank you, Vince. Now on to our third quarter results. Revenue of $2.88 billion came in above the high end of our outlook, up 9% sequentially and 25% year over year. Industrial represented 45% of our third quarter revenue, finishing up 12% sequentially and 23% year over year. Our industrial recovery has continued with sequential growth across all sub and regions. Year over year growth accelerated across all major applications, led by our automatic test equipment business fueled by increasing AI investment. Additionally, our aerospace and defense business had a record quarter. Automotive represented 30% of quarterly revenue, finishing down 1% sequentially and up 22% year over year. Double-digit year-over-year growth continues to be driven by our leading connectivity and functionally safe power solutions. Communications represented 13% of quarterly revenue finishing up 18% sequentially and 40% year over year. Our wireline and data center business, which is roughly two-thirds of total communications, grew double digits sequentially and year over year as increasing AI demand continues. Wireless also grew double digits both sequentially and year over year. And lastly, consumer represented 13% of quarterly revenue finishing up 16% sequentially and 21% year over year, marking the fourth straight quarter of double-digit year-over-year growth. We continue to see strength across handsets, gaming, hearables, and wearables. Now onto the rest of the P&L. Third quarter gross margin was 69.2%, and operating margin was 42.2%, up 100 basis points sequentially and year over year. Non-operating expenses finished at $57 million and the tax rate for the quarter was 11.9%. All told, EPS was $2.05 above the high end of our guided range and up 30% year over year. Now I'd like to highlight a few items from our balance sheet and our cash flow statements. Cash and short-term investments finished the quarter at $3.5 billion and our net leverage ratio remained virtually flat at 1.1. Inventory increased $72 million sequentially in support of the cycle recovery. Days of inventory declined to 160, and channel weeks ticked lower. We are continuing to execute our strategy of keeping leaner channel inventories while maintaining higher levels on our balance sheet. Over the trailing twelve months, operating cash flow and CapEx $4.2 billion and $500 million respectively. We continue to expect fiscal 2025 CapEx to be within our long-term model of 4% to 6% of revenue. Free cash flow over the trailing twelve months was $3.7 billion, 35% of revenue, and we have returned $3.5 billion in cash to shareholders over the last four quarters. As a reminder, we target 100% free cash flow return over the long term using 40 to 60% for our dividend and the remainder for share count reduction. Now on to our fourth quarter guidance. Revenue is expected to be $3 billion plus or minus $100 million. On a sequential basis at the midpoint, we expect industrial, communications, and consumer to increase with the fastest growth in industrial. Automotive is expected to decline. Operating margin is expected to increase to 43.5%, plus or minus one basis points. Our tax rate is expected to be between 11-13%. And based on these inputs, adjusted EPS is expected to be $2.22 plus or minus 10¢. In closing, our strong results and outlook for continued growth, especially in the industrial market, reinforce our view that 2025 will close as a strong recovery year for ADI. However, we are mindful of the continued uncertainty facing customers with respect to tariffs and are monitoring the impacts closely. We believe we are well positioned to successfully navigate an evolving global operating environment thanks to the optionality enabled by the diversity of our markets, applications, and products and the resilience of our hybrid manufacturing strategy. With that, let's go to our Q&A session. We ask that you limit yourself to one question in order to allow us for additional participants on the call this morning. If you have follow-up questions, please re-queue, and we will take your question if time allows. Operator, can we have our first question, please? Operator: Thank you. For those participating by telephone dial-in, if you have a question, please press 11 on your phone to enter the queue. If your question has been answered, and you wish to be removed from the queue, please press 11 again. If you are listening on a speakerphone, please pick up the handset when you're asked. And our first question comes from Timothy Arcuri with UBS. You may proceed. Timothy Arcuri: Thanks a lot. So, industrial last quarter was 7%. It was up 11% this quarter, and it sounds like it's going to be very strong again in fiscal Q4. Can you just talk do you think you're now shipping above consumption in these markets? How do you view sort of where we are? Are we now in, you know, inventory build mode in those markets, and how do you sort of assess, you know, how long the, you know, goodness can last? Richard Puccio: So I got since we called the bottom back in Q2, so industrial has been our most profitable business and has grown sequentially every quarter. More recently, as we've talked about, the growth has accelerated, and our outlook for Q4, which is normally a seasonally down quarter for industrial, we expect it to grow in the low to mid-teens quarter over quarter. So very, very strong outlook there. You know? And what's important is growth is happening across all of our industrial sectors, including instrumentation, automation, aerospace, defense, healthcare, and energy infrastructure, as well as across all the geographies. Again, an indication that we are in this cyclical upturn. You know, at the same time for us, we've talked about this in multiple quarters, you know, our channel inventories continue to be very lean, and we believe end demand is still double digits below consumption. Now we are gonna start seeing some catch up to the end demand in the fourth quarter. As we as I mentioned in my prepared remarks, you know, we did see the channel inventory weeks tick down a little bit as the end demand was a bit higher than we had planned. You know? And then so on top of that, you know, as we look forward, we are continuing to see green shoots across aerospace and defense and ATE. And so we feel pretty good about where we are both near and long term from an industrial perspective. Timothy Arcuri: Great. Thank you. Operator: Our next question comes from Harlan Sur with JPMorgan. You may proceed. Harlan Sur: Hey, good morning. Thanks for taking my question and great job on the quarterly execution. Looks like you guys had anticipated last earnings call gross margins for Q3 to be closer to 70%, but actuals were actually closer to 69%. I assume it's because of the upside in the lower margin communications business, which was up 17% sequentially. So essentially mix related. Is that a fair assumption? And then on Q4 at the midpoint of your guidance range, are you guys assuming that gross margins are improving sequentially? Richard Puccio: Yes. So I'll take that one. So yes, we did have an implied increase in the margin. You know? However, we did have an unexpected lower utilization during the quarter, which kept us from growing our gross margin on a sequential basis. However, the utilization is back on track, and we expect it to resume its increase. And in Q4 at the midpoint, we do expect to get back a 70% margin. Had we not had the disruption in the utilization in the third quarter, we actually would have grown sequentially. But the mix piece as you mentioned, because we still are only at 45% industrial mix in the third quarter, would have kept us from fully getting to 70%. Harlan Sur: I see. Thank you, Rich. Richard Puccio: Sure. Thank you. Operator: Our next question comes from Tore Svanberg with Stifel. You may proceed. Tore Svanberg: Yes. Congrats on the continuous recovery here. Vince, had a question on the automation revenue. I think in the past, you've talked about this sort of being a 15% grower, and that's certainly, you know, above the corporate average. I'm just curious, given everything that you're seeing now in humanoids and robotics, you know, reference designs with some key GPU players and so on and so forth. Are you starting to see perhaps an acceleration, you know, that 15% growth target going forward? Vincent Roche: Yeah. Thanks for the question, Tore. So, yeah, you know, the automation business for ADI is multiple hundreds of millions of dollars on an annual basis. And it's our sense that by 2030, we can double the size of that business given the strength of the R&D pipeline, the opportunity pipeline that we have, as well as some of these new modalities that are coming into play, you know, as demographics and macro pressures kind of lean on putting more and more manufacturing capability closer to points of consumption. There's obviously a security issue as well, supply chain security issue. So all those factors, I think, exogenous and endogenous factors point to a strong growth in that business. Also, as I pointed out in the prepared remarks, we're seeing a lot of new sensing modalities come to bear, and every one of those sensors or actuators that our customers are putting in place require very precise sensing control and data processing. So for all those reasons, we feel very optimistic about the state of this business and its potential to grow and double its size over the next five or six years. Tore Svanberg: Thank you, Vince. Vincent Roche: Thank you. Operator: Our next question comes from Vivek Arya with Bank of America. You may proceed. Vivek Arya: Thanks for taking my question. I think in response to a prior question, you mentioned that you're seeing green shoots in different parts of industrial, right? And despite the strength that you saw in Q2 and Q3. So does it mean that as we kind of potentially look out to Q1, is ADI still capable of growing at least seasonal or above seasonal? And if yes, you know, what is kind of normal range of seasonality so we can calibrate our models? Thank you. Richard Puccio: Vivek, I'll start. From a Q1 perspective, you know, as we said before, we don't guide to Q1. But we do expect that we'll be able to grow at seasonal. And, you know, obviously, for us on an overall perspective, you know, first quarter tends to seasonally be down, you know, in the low single digits. Vincent Roche: Yeah. So I think, you know, as we look into the new year, I believe industrial will be a very, very strong part of our momentum in the coming year. And as Rich narrated in part of the Q&A here, you know, from just the supply-demand side of things, we're seeing still customers are in digestion phase of their excess inventories, and particularly in the broad market, which is a piece of a significant piece of the industrial business in the past where we're still seeing the demand there quite light. So there's still a kind of a normalization to take place, which should boost the industrial sales in the coming quarters as well as our position with new products and our position with customers and new applications. So in the automation space, so we've got aerospace and defense, which has been incredibly strong. In fact, in some ways, we're supply limited in that business. So I think that will be the bedrock of the next several quarters of the company's performance. Vivek Arya: Thank you. Vincent Roche: Thank you. Operator: Our next question comes from Jim Schneider with Goldman Sachs. You may proceed. Jim Schneider: Good morning. Thanks for taking my question. I was wondering if you could provide a little bit of color on what you're seeing in the automotive market. I believe last quarter you referenced some select inactivity. Did you actually in fact see that occur in the quarter? And if so, from what regions? And then going forward, maybe talk a little bit about what's driving the sequential decline you expect in the quarter? And any color you can provide on regions or customer OEM types will be helpful. Thank you. Richard Puccio: Thanks, Jim. So, you know, obviously, we continue to perform very well in automotive, particularly in our connectivity and power management, fueling auto revenue. As we've said, we expect to record levels of auto revenue for 2025. You know, in addition to our content growth and share gains in the gen ADAS and infotainment systems, you know, we do believe our auto revenue has been aided by some order acceleration, which we talked about in Q2. We do think there was some additional acceleration in Q3. However, we do see that unwinding in Q4, which is why we expect to see Q4 come down. You know, we think that will be the sort of close out of that early buying. You know? And this is what we actually talked about when we released our last quarter results was we expected that the pull-ins were likely going to come from our Q4 or Q1 period. Based on the way it's settling out, it looks like it's unwinding in the fourth quarter. You know? And if you think about that from a just from a sizing perspective, in the current quarter, you know, we were obviously above our high end of our guide. And I think largely that part of the that we were above the high end of our guide was likely related to the auto pull-ins. And what's different this time actually is the auto pull-ins we saw this time in Q3 were in China, whereas when we talked about them in Q2, that was for North America and Europe. You know? It's for us to know how this will shake out. But we do think that given the behavior we've seen from our auto customers, you know, EV credits expiring and the risk that tariffs sort of could curtail production, we are taking a bit of a more conservative view to automotive in the near term. Vincent Roche: But, you know, stepping back again, we'll have our third record year in auto in the last four years, which is reflecting our content and share gains. You know, and we've talked about this before. You know, we tend to outpace the SAR volumes with content gains where we're getting about a double-digit benefit from share and content. So we feel really well positioned there as we go into the medium and long term. Jim Schneider: Thank you. Operator: Our next question comes from Stacy Rasgon with Bernstein Research. You may proceed. Stacy Rasgon: Hi, guys. Thanks for taking my question. So around the auto pull-ins and, I guess, relative to industrial, so you I mean, you're guiding auto implicitly down 15% sequentially as those pull-ins kind of ease. Industrial, you're guiding up. I don't know. You said low to mid-teens, which would put it up, you know, in the mid 30% year over year. What are you seeing differently on the trends in industrial versus what you saw in auto that gives you confidence that the strength you're seeing in industrial is not also pull forward? Richard Puccio: So what we talked about last time is the indicators, Stacy, for what we thought were pull-ins, where we saw unplanned growth in areas, you know, around and that and we saw the anomalous bookings behavior that happened around the tariff announcements and then the ensuing reversals. Things normalize. We have not seen that kind of behavior in industrial. In fact, the bookings trends have followed the trends we were expecting. It's impossible to say there isn't some minor amount maybe in any of the businesses, we haven't seen anything outside of auto that would give us an indication there's any meaningful pull-in our business. Vincent Roche: Yeah. I think it's probably yeah. Go ahead. Stacy Rasgon: Industrial is well above seasonal, though. So, I mean, is that just that's just increased demand if channel fill or what? Vincent Roche: No. It's in three problems. It's nothing to do with channel. Yeah. Channel is very lean. We're still undershipping real consumption of the market. Parts of industrial have been just in inventory digestion mode for actually a couple of years. So we're starting to get that behind us. But if you look at the strength of our aerospace and defense, you know, I mentioned there a little while ago, we're actually supply limited there. Very, very strong backlog. ATE, which is supporting the build-out of AI chips and infrastructure. Very, very strong demand. And we've begun to see the recovery of the automation business in the, you know, over the last couple of core two, three quarters. When you couple that as well with healthcare, which has been really damp in terms of demand, you know, ever since the kind of the peak of the pandemic there. That should come good as well, and we're seeing signs of stabilization, but that should come good over the next few quarters. So I think you put all that together, the breadth and the depth, customer count, the product count, some of the idiosyncratic trends that we've captured as well as just the overall rising tide in demand across the board bodes well for the industrial business. Stacy Rasgon: Got it. That's helpful. Thank you. Vincent Roche: Thank you. Operator: Our next question comes from Chris Danely with Citi. You may proceed. Chris Danely: Hey. Thanks, guys. Can you just give us a little more color on why the utilization rates came down and then where utilization rates are, where you're expect them to go, and any other gross margin drivers going forward as well? Thanks. Vincent Roche: Well, I think, you know, we had a, as Rich said, a onetime event in our European fab during the last quarter. That was the primary dampening effect on the gross margin. So it became, you know, an absorption issue. I will say as well pricing has been very, very steady. And as our mix improves on the industrial side of things, we get the benefit of that in the gross margin. And I don't expect a repeat of, you know, what was a onetime event in one of our factories in the last quarter to repeat. Chris Danely: What are utilization rates now? Richard Puccio: So I don't I don't I know you always like to ask me this. They're increasing. We're not yet back to the utilization levels we were obviously, in the pandemic era nor do we expect to get all the way there. But we are continuing to increase, as I mentioned, other than this one-time hiccup, which is now behind us, we are back increasing. As given the growth we're seeing and the plan starts in the factories, we're getting higher utilizations. Vincent Roche: So I think as well, we have talked many, many times about the CapEx that we've deployed to strengthen the resiliency of the internal fabs at ADI. So we have built we've more than doubled the footprint of the internal fabs that support largely the industrial business, so we're absorbing that cost, and as the industrial business continues to increase in strength, you know, that absorption strengthens as well. So I think you've gotta bear those things in mind. Chris Danely: Okay. Thanks, guys. Vincent Roche: Thanks, Chris. Richard Puccio: Thank you. Operator: Our next question comes from Joe Moore with Morgan Stanley. You may proceed. Joe Moore: Great. Thank you. Couple of minutes ago, you talked about seeing some supply limitations in aerospace and defense. I wanted to just follow-up on that and talk ask where those supply constraints might be coming from. And you seeing any supply constraints in any other part of your industrial business as things get stronger? Vincent Roche: You know, I think we've just seen a tremendous upsurge in the amount. It just takes time to lay in the capacity, the tooling. In the aerospace and defense area. And you know, it's a highly diversified business with an incredible array of product complexities. So, you know, it's really just a case of, you know, each quarter, we're laying in more capacity. And but the demand keeps increasing. It's a very, very high-quality problem that we have. Demand is surging ahead of our ability to manufacture right now, but we've been laying in the CapEx, the tools, to make sure that we capture the opportunity. And pretty much everything we do there is sole source. I mean, these are proprietary products. And we see this. We've increased our footprint. We've an internal factory that's very, very important to the manufacturing of our aerospace and defense solutions. So we've been tooling that facility as well. So I think generally speaking, we're in better and better position, but really the problem it's a high-quality problem of surging demand. Richard Puccio: Yeah. So I'll put an even finer point on it for you, Joe. We're actually deploying tools into the aerospace and defense manufacturing in the third and fourth some in the third and more in the fourth quarter to alleviate some of the stress events just described. And from an overall business perspective, we certainly have supply right now to cover all of the near-term demand that we have on the books. I think the rest of the industrial business is in good shape overall regarding supply. Joe Moore: Yes. Thank you. Richard Puccio: Thanks, Joe. Joe Moore: Thank you. Operator: Our next question comes from Joshua Buchalter with TD Cowen. You may proceed. Joshua Buchalter: Hey, guys. Thank you for taking my question, and congrats on the good results. I apologize for being nitpicky in an objectively good quarter. I did want to ask about gross margins, though. I think a couple of quarters ago, you had mentioned $2.7 billion being sort of the level at which you hit 70% gross margins. It looks like that's seemingly around $3 billion I guess. Can you maybe walk through what's changed and how we should think about fall through from here going forward? Thank you. Richard Puccio: Thanks, Josh. And I we have talked about this a lot, and I think that the part two of what we've said all along is getting to $2.7 billion and getting back to a 70% margin would require us to get back to a more normal industrial mix. So near term, as you saw, we were only 45% industrial when we were building all those models. We were a much larger percentage. So we have said we would need to have that mix. And obviously, the mix is shifting as the industrial grows. And if you look to our, you know, where we expect our Q4 to go with the industrial growth we've talked about, you know, we will probably exit Q4 with more like a 49% industrial mix, which is part of the reason we think we'll get back into that 70% range in our fourth quarter. So it is as we talked at the beginning a little bit, it is also mix constrained given the industrial piece is our most profitable business. Joshua Buchalter: Understood. Thank you for the color there. Richard Puccio: Thanks, Josh. Operator: Thank you. Our next question comes from Ross Seymore with Deutsche Bank. You may proceed. Ross Seymore: Hi, guys. Thanks for letting me ask the question. Just wanted to pivot over to the OpEx side of things. Any sort of color for your fiscal fourth quarter? And probably more importantly, as we look into fiscal 2026, I know you guys have a big variable component to your OpEx. This year, it looks like it's up I don't know, high teens or something like that in fiscal 2025. Any sort of color on how the OpEx would relate to revenues in fiscal 2026? Richard Puccio: So, yeah. So, from a fiscal 2025 perspective, assuming the midpoint for Q4, we expect we'll deliver about 100 basis points of operating leverage versus 2024. Which I feel very good about because when we started the year, knowing we were gonna have a pretty significant headwind on the variable comp, we thought we might have a pretty flat operating leverage here, but we are gonna deliver some additional leverage. Now a lot of that is coming from the gross margin expansion as we've talked about. Because some because of variable, our OpEx is growing at a higher rate than we would normally expect, and that is, you know, as we've talked about. Right? In the prior year, given our bonus pays on revenue growth and profitability and the fact that 2024 had no revenue growth and margins were muted, bonus was very low, which was part of the reason we were able to hold our 40% operating margin in the trough year. Now with a return to significant growth, our variable comp is normalizing to a much higher level from a, you know, a very low payout in the prior year. So if you look forward to 2026, I would expect that acceleration piece that we saw from the variable comp to decline. You know, we obviously would expect to have variable comp in a growth year, but given the new baseline of 2026, we would expect in the revenue growth that we would get some continued leverage as the operating as the variable won't increase as radically as it did 2024 to 2025. Ross Seymore: And then excuse me. Obviously, all of these points of view are contingent on revenue growing, you know, which we're assuming in from a top line perspective. Richard Puccio: Thank you. Ross Seymore: Thank you. Operator: And our final question comes from Chris Caso with Wolfe Research. You may proceed. Chris Caso: Yes, thanks. Good morning. Just a question on business in China right now. And you mentioned in some of your earlier comments that China auto was strong last quarter. Could you give us some sense of what the totality of the China business looked like? And, again, in that case, even outside of auto, is there any fear of, you know, any pull forwards within that business or any anomalies that you may have seen within the China business in the last quarter? Richard Puccio: Sure. So, obviously, we've talked about China is a very, very competitive place for us. But, you know, I continue to be very confident in our ability to win and to grow in China, which we've done for decades. Now if you think about how we're positioned in the market, right, we tend to get a premium for our performance, you know, and that's the innovation premium you've all heard me talk about. Where performance matters, they're gonna continue to pick us, right, which is why we tend to get higher ASPs. It also makes it very challenging for those that make products that are good enough to compete with us in that market. So we feel from a competitive perspective, we feel very well. Obviously, the other thing for us that's significant is, you know, scale is really important. Especially in analog with the broad base of components. You know, we've got six decades of experience building that with 70,000 SKUs. It's really, really especially true in industrial given the diverse nature of that product. As we've talked about now for a number of quarters, China has been leading our recovery. Right? We've talked about they've achieved achieving record auto results. This year. We had record design wins in 2024. We've continued growth in design wins in 2025. And our outlook for China is pretty positive over the next three to five years. Based on the things we're seeing here. Now it is interesting. We've spent a lot of time talking about how strong China auto is. We've started to see year-over-year growth in China across all of the industrial end markets. But outside of auto, all of those other end markets are well off their prior peaks. So, you know, north of 35% at least, and some of them are still 50% off their peaks. So we think there's still runway there for us from a medium and long-term perspective. As that market continues to rebound. Chris Caso: Thanks. Richard Puccio: Thank you. Operator: I would now like to turn the call back over to Mr. Richard Puccio for any closing remarks. Richard Puccio: Alright. Thanks, everyone, for joining us this morning. And with that, a copy of this transcript will be available on our website and all available reconciliations and additional information can also be found at the Quarterly Results section of our Investor Relations site at Thanks again for joining us and your continued interest in Analog Devices. Operator: Thank you. This concludes today's Analog Devices conference call. You may now disconnect. Don't miss this second chance at a potentially lucrative opportunity Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. 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Analog Devices to Participate in Bernstein Strategic Decisions Conference
WILMINGTON, Mass., May 23, 2025 /PRNewswire/ -- Analog Devices, Inc. (Nasdaq: ADI) today announced that the Company's Executive Vice President & Chief Financial Officer, Richard Puccio, will discuss business topics and trends at the Bernstein 41st Annual Strategic Decisions Conference, taking place at New York Marriott Marquis Hotel, located in New York, New York, Thursday, May 29, 2025 at 11:00 a.m. EST. The webcast for the conference may be accessed live via the Investor Relations section of Analog Devices' website at An archived replay will also be available following the webcast for at least 30 days. About Analog Devices, Inc. Analog Devices, Inc. (NASDAQ: ADI) is a global semiconductor leader that bridges the physical and digital worlds to enable breakthroughs at the Intelligent Edge. ADI combines analog, digital, and software technologies into solutions that help drive advancements in digitized factories, mobility, and digital healthcare, combat climate change, and reliably connect humans and the world. With revenue of more than $9 billion in FY24 and approximately 24,000 people globally, ADI ensures today's innovators stay Ahead of What's Possible. Learn more at and on LinkedIn and Twitter (X). For more information, please contact:Jeff AmbrosiSenior Director of Investor RelationsAnalog Devices, View original content to download multimedia: SOURCE Analog Devices, Inc. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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22-05-2025
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Wall Street Just Dumped Analog Devices--But Smart Money Might Be Buying the Dip
Analog Devices (NASDAQ:ADI) just put up numbers that most companies would love to brag aboutyet the stock still got punished. Revenue? Beat. EPS? Beat. Margins? Still elite, with gross margin clocking in at 69.4% and operating margin at 41.2%. Management sounded confident, citing double-digit growth across all end markets and stronger bookings across every region. Guidance for Q3 suggests the rally could continue, with revenue potentially landing around $2.75 billion. On paper, it's everything bulls want to see. Warning! GuruFocus has detected 12 Warning Signs with ADI. But the market didn't bite. ADI dropped 4.25% at 1.21pm. Why? Maybe some investors are questioning whether this cyclical bounce is sustainable, or if short-term optimism was already priced in. Maybe it's just some good old-fashioned profit-taking after a pre-earnings run-up. Either way, the selloff feels more like hesitation than conviction. CFO Richard Puccio reiterated that demand signals improved throughout Q2, and that momentum looks set to build. If he's right, this could be a temporary misread. Meanwhile, ADI's financials tell a story of quiet consistency. Over the last two years, the company has steadily generated positive free cash flow and net income, even as broader tech saw turbulence. Dividend payments? Unshaken. That stability could make the current dip a gift for long-term investorsespecially those who prefer quality, margin-rich names with real cash backing up the narrative. This article first appeared on GuruFocus. Sign in to access your portfolio
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22-05-2025
- Business
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Analog Devices CFO Confirms Cyclical Upturn, Sees 'Continued Growth'
Analog Devices, Inc (NASDAQ:ADI) shares are trading higher in the premarket session on Thursday after the company reported fiscal second-quarter results. The company's quarterly revenue increased 22% year-on-year to $2.64 billion, beating the analyst consensus estimate of $2.51 billion. Adjusted EPS of $1.85 beat the analyst consensus estimate of $1.70. Analog Devices' Industrial revenue grew by 16.8% Y/Y to $1.16 billion. Automotive revenue climbed 24.2% Y/Y to $849.51 revenue grew by 29.7% to $317.76 million, and Communications revenue increased by 32.1% to $315.06 million. The adjusted gross margin improved by 270 bps to 69.4%. The adjusted operating margin climbed by 220 bps to 41.2%. Analog Devices held $2.38 billion in cash and equivalents as of May 3, 2025, generating $819.5 million in operating cash flow. The Analog Devices Board declared a quarterly cash dividend of $0.99 per outstanding share of common stock. The dividend will be paid on June 18, 2025, to all shareholders of record at the close of business on June 4, 2025. CEO and Chair Vincent Roche said that against a backdrop of global trade volatility, the company's performance reflects the ongoing cyclical recovery and the strength and resiliency of its business model. CFO Richard Puccio said second-quarter bookings accelerated across all end markets and regions, resulting in continued sequential backlog growth. The improving demand signals it saw throughout its fiscal second quarter support its outlook for continued growth in the third quarter and reinforce its view that it is in a cyclical upturn. Analog Devices expects fiscal third-quarter 2025 revenue of $2.65 billion-$2.85 billion, above the analyst consensus estimate of $2.62 billion. The company projects adjusted EPS of $1.82-$2.02 against the analyst consensus estimate of $1.83. Price Action: ADI stock is trading higher by 3.15% to $229.22 premarket at last check Thursday. Read Next:Image via Shutterstock UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? ANALOG DEVICES (ADI): Free Stock Analysis Report This article Analog Devices CFO Confirms Cyclical Upturn, Sees 'Continued Growth' originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
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22-05-2025
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Analog Devices Reports Fiscal Second Quarter 2025 Financial Results
Revenue of $2.64 billion, with double-digit year-over-year growth across all end markets Operating cash flow of $3.9 billion and free cash flow of $3.3 billion on a trailing twelve-month basis or 39% and 34% of revenue, respectively Returned $0.7 billion to shareholders via dividends and repurchases during the second quarter WILMINGTON, Mass., May 22, 2025 /PRNewswire/ -- Analog Devices, Inc. (Nasdaq: ADI), a global semiconductor leader, today announced financial results for its fiscal second quarter 2025, which ended May 3, 2025. "ADI delivered second quarter revenue and earnings per share above the high end of guidance," said Vincent Roche, CEO and Chair. "Against a backdrop of global trade volatility, our performance reflects the ongoing cyclical recovery, and the strength and resiliency of our business model. Our unwavering commitment to innovation and customer success, enables ADI to continue extending our leadership at the increasingly AI-driven Intelligent Edge, delivering exceptional value for shareholders over both the near- and long-terms." CFO Richard Puccio added, "Second quarter bookings accelerated across all end markets and all regions, resulting in continued sequential backlog growth. The improving demand signals we saw throughout our fiscal Q2, support our outlook for continued growth in Q3, and reinforce our view that we are in a cyclical upturn." Performance for the Second Quarter of Fiscal 2025 Results Summary(1)(in millions, except per-share amounts and percentages) Three Months EndedMay 3, 2025May 4, 2024Change Revenue $ 2,640$ 2,15922 % Gross margin $ 1,612$ 1,18037 % Gross margin percentage 61.0 %54.7 %630 bps Operating income $ 678$ 38676 % Operating margin 25.7 %17.9 %780 bps Diluted earnings per share $ 1.14$ 0.6187 % Adjusted Results(2)Adjusted gross margin $ 1,832$ 1,44027 % Adjusted gross margin percentage 69.4 %66.7 %270 bps Adjusted operating income $ 1,088$ 84229 % Adjusted operating margin 41.2 %39.0 %220 bps Adjusted diluted earnings per share $ 1.85$ 1.4032 %Three Months EndedTrailing Twelve Months Cash Generation May 3, 2025May 3, 2025 Net cash provided by operating activities $ 819$ 3,852 % of revenue 31 %39 % Capital expenditures $ (90)$ (559) Free cash flow(2) $ 729$ 3,294 % of revenue 28 %34 %Three Months EndedTrailing Twelve Months Cash Return May 3, 2025May 3, 2025 Dividend paid $ (491)$ (1,861) Stock repurchases (249)(622) Total cash returned $ (740)$ (2,482) (1) The sum and/or computation of the individual amounts may not equal the total due to rounding. (2) Reconciliations of non-GAAP financial measures to their most directly comparable GAAP financial measures are provided in the financial tables included in this press release. See also the "Non-GAAP Financial Information" section for additional information. Outlook for the Third Quarter of Fiscal Year 2025 For the third quarter of fiscal 2025, we are forecasting revenue of $2.75 billion, +/- $100 million. At the midpoint of this revenue outlook, we expect reported operating margin of approximately 27.2%, +/-150 bps, and adjusted operating margin of approximately 41.5%, +/-100 bps. We are planning for reported EPS to be $1.23, +/-$0.10, and adjusted EPS to be $1.92, +/-$0.10. Our third quarter fiscal 2025 outlook is based on current expectations and actual results may differ materially as a result of, among other things, the important factors discussed at the end of this release. The statements about our third quarter fiscal 2025 outlook supersede all prior statements regarding our business outlook set forth in prior ADI news releases, and ADI disclaims any obligation to update these forward-looking statements. The adjusted results and adjusted anticipated results above are financial measures presented on a non-GAAP basis. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures are provided in the financial tables included in this release. See also the "Non-GAAP Financial Information" section for additional information. Dividend Payment The ADI Board of Directors has declared a quarterly cash dividend of $0.99 per outstanding share of common stock. The dividend will be paid on June 18, 2025 to all shareholders of record at the close of business on June 4, 2025. Conference Call Scheduled for Today, Thursday, May 22, 2025 at 10:00 am ET ADI will host a conference call to discuss our second quarter fiscal 2025 results and short-term outlook today, beginning at 10:00 am ET. Investors may join via webcast, accessible at Non-GAAP Financial Information This release includes non-GAAP financial measures that are not in accordance with, nor an alternative to, U.S. generally accepted accounting principles (GAAP) and may be different from non-GAAP measures presented by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. These non-GAAP measures have material limitations in that they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP and should not be considered in isolation from, or as a substitute for, the Company's financial results presented in accordance with GAAP. The Company's use of non-GAAP measures, and the underlying methodology when including or excluding certain items, is not necessarily an indication of the results of operations that may be expected in the future, or that the Company will not, in fact, record such items in future periods. You are cautioned not to place undue reliance on these non-GAAP measures. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures are provided in the financial tables included in this release. Management uses non-GAAP measures internally to evaluate the Company's operating performance from continuing operations against past periods and to budget and allocate resources in future periods. These non-GAAP measures also assist management in evaluating the Company's core business and trends across different reporting periods on a consistent basis. Management also uses these non-GAAP measures as primary performance measurements when communicating with analysts and investors regarding the Company's earnings results and outlook and believes that the presentation of these non-GAAP measures is useful to investors because it provides investors with the operating results that management uses to manage the Company and enables investors and analysts to evaluate the Company's core business. Management also believes that free cash flow, a non-GAAP liquidity measure, is useful both internally and to investors because it is indicative of the Company's ability to pay dividends, purchase common stock, make investments and fund acquisitions and, in the absence of refinancings, to repay its debt obligations. The non-GAAP financial measures referenced by ADI in this release include: adjusted gross margin, adjusted gross margin percentage, adjusted operating expenses, adjusted operating expenses percentage, adjusted operating income, adjusted operating margin, adjusted nonoperating expense (income), adjusted income before income taxes, adjusted provision for income taxes, adjusted tax rate, adjusted diluted earnings per share (EPS), free cash flow, and free cash flow revenue percentage. Adjusted gross margin is defined as gross margin, determined in accordance with GAAP, excluding certain acquisition related expenses1, which are described further below. Adjusted gross margin percentage represents adjusted gross margin divided by revenue. Adjusted operating expenses is defined as operating expenses, determined in accordance with GAAP, excluding: certain acquisition related expenses1 and special charges, net2, which are described further below. Adjusted operating expenses percentage represents adjusted operating expenses divided by revenue. Adjusted operating income is defined as operating income, determined in accordance with GAAP, excluding: acquisition related expenses1 and special charges, net2, which are described further below. Adjusted operating margin represents adjusted operating income divided by revenue. Adjusted nonoperating expense (income) is defined as nonoperating expense (income), determined in accordance with GAAP, excluding: certain acquisition related expenses1, which is described further below. Adjusted income before income taxes is defined as income before income taxes, determined in accordance with GAAP, excluding: acquisition related expenses1 and special charges, net2, which are described further below. Adjusted provision for income taxes is defined as provision for income taxes, determined in accordance with GAAP, excluding tax related items3, which are described further below. Adjusted tax rate represents adjusted provision for income taxes divided by adjusted income before income taxes. Adjusted diluted EPS is defined as diluted EPS, determined in accordance with GAAP, excluding: acquisition related expenses1, special charges, net2, and tax related items3, which are described further below. Free cash flow is defined as net cash provided by operating activities, determined in accordance with GAAP, less additions to property, plant and equipment, net. Free cash flow revenue percentage represents free cash flow divided by revenue. 1Acquisition Related Expenses: Expenses incurred as a result of current and prior period acquisitions and primarily include expenses associated with the fair value adjustments to debt, property, plant and equipment and amortization of acquisition related intangibles, which include acquired intangibles such as purchased technology and customer relationships. Expenses also include fair value adjustments associated with the replacement of share-based awards related to the Maxim Integrated Products, Inc. (Maxim) acquisition. We excluded these costs from our non-GAAP measures because they relate to specific transactions and are not reflective of our ongoing financial performance. 2Special Charges, Net: Expenses, net, incurred as part of the integration of Maxim, in connection with facility closures, consolidation of manufacturing facilities, severance, other accelerated stock-based compensation expense and other cost reduction efforts or reorganizational initiatives. We excluded these expenses from our non-GAAP measures because apart from ongoing expense savings as a result of such items, these expenses have no direct correlation to the operation of our business in the future. 3Tax Related Items: Income tax effect of the non-GAAP items discussed above. We excluded the income tax effect of these tax related items from our non-GAAP measures because they are not associated with the tax expense on our current operating results. About Analog Devices, Devices, Inc. (NASDAQ: ADI) is a global semiconductor leader that bridges the physical and digital worlds to enable breakthroughs at the Intelligent Edge. ADI combines analog, digital, and software technologies into solutions that help drive advancements in digitized factories, mobility, and digital healthcare, combat climate change, and reliably connect humans and the world. With revenue of more than $9 billion in FY24 and approximately 24,000 people globally, ADI ensures today's innovators stay Ahead of What's Possible. Learn more at and on LinkedIn and Twitter (X). Forward-Looking StatementsThis press release contains forward-looking statements, which address a variety of subjects including, for example, our statements regarding future financial performance; impacts related to tariffs and other trade restrictions; economic uncertainty; macroeconomic, geopolitical, demand and other market conditions, business cycles, and supply chains; our hybrid manufacturing strategy; our capital allocation strategy, including future dividends, share repurchases, capital expenditures, investments, and free cash flow returns; expected revenue, operating margin, nonoperating expenses, tax rate, earnings per share, and other financial results; expected market and technology trends and acceleration of those trends; market size, market share gains, market position, and growth opportunities; expected product solutions, offerings, technologies, capabilities, and applications; the value and importance of, and other benefits related to, our product solutions, offerings, and technologies to our customers; and other future events. Statements that are not historical facts, including statements about our beliefs, plans and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: economic, political, legal and regulatory uncertainty or conflict, including increased uncertainty and volatility with respect to tariffs, export controls and other trade restrictions, actions taken or which may be taken by the presidential administration, executive offices of the U.S. government, or U.S. Congress, monetary policy, political, geopolitical, trade, or other issues in the United States or internationally, and the ongoing conflicts between Russia and Ukraine and in Israel and the Middle East; changes in demand for semiconductor products; manufacturing delays, product and raw materials availability and supply chain disruptions; diversion of products from our authorized distribution channels; changes in export classifications, import and export regulations or duties and tariffs; our development of technologies and research and development investments; our future liquidity, capital needs and capital expenditures; our ability to compete successfully in the markets in which we operate; our ability to recruit and retain key personnel; risks related to acquisitions or other strategic transactions; security breaches or other cyber incidents; risks related to the use of artificial intelligence in our business operations, products, and services; adverse results in litigation matters; reputational damage; changes in our estimates of our expected tax rates based on current tax law; risks related to our indebtedness; the discretion of our Board of Directors to declare dividends and our ability to pay dividends in the future; factors impacting our ability to repurchase shares; and uncertainty as to the long-term value of our common stock. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the Securities and Exchange Commission, including the risk factors contained in our most recent Annual Report on Form 10-K. Forward-looking statements represent management's current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances. Analog Devices and the Analog Devices logo are registered trademarks or trademarks of Analog Devices, Inc. All other trademarks mentioned in this document are the property of their respective owners. ANALOG DEVICES, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share amounts) Three Months EndedSix Months EndedMay 3, 2025May 4, 2024May 3, 2025May 4, 2024 Revenue $ 2,640,068$ 2,159,039$ 5,063,242$ 4,671,743 Cost of sales 1,028,458979,0042,021,3292,017,767 Gross margin 1,611,6101,180,0353,041,9132,653,976 Operating expenses: Research and development 441,837354,862844,729746,289 Selling, marketing, general and administrative 302,669244,129587,465534,207 Amortization of intangibles 187,415188,944374,830379,276 Special charges, net 1,7455,97765,63222,117 Total operating expenses 933,666793,9121,872,6561,681,889 Operating income 677,944386,1231,169,257972,087 Nonoperating expense (income): Interest expense 74,70377,103149,967154,244 Interest income (21,725)(15,269)(45,212)(24,438) Other, net (962)(314)2,9984,260 Total nonoperating expense (income) 52,01661,520107,753134,066 Income before income taxes 625,928324,6031,061,504838,021 Provision for income taxes 56,15822,361100,41873,052 Net income $ 569,770$ 302,242$ 961,086$ 764,969 Shares used to compute earnings per common share - basic 496,173496,130496,145495,947 Shares used to compute earnings per common share - diluted 498,201498,533498,434498,637 Basic earnings per common share $ 1.15$ 0.61$ 1.94$ 1.54 Diluted earnings per common share $ 1.14$ 0.61$ 1.93$ 1.53 ANALOG DEVICES, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share and per share amounts) May 3, 2025Nov. 2, 2024 ASSETSCurrent AssetsCash and cash equivalents $ 2,376,235$ 1,991,342 Short-term investments —371,822 Accounts receivable 1,382,3651,336,331 Inventories 1,524,8971,447,687 Prepaid expenses and other current assets 305,040337,472 Total current assets 5,588,5375,484,654 Non-current AssetsNet property, plant and equipment 3,336,1283,415,550 Goodwill 26,945,18026,909,775 Intangible assets, net 8,787,3809,585,464 Deferred tax assets 1,985,5912,083,752 Other assets 701,671749,082 Total non-current assets 41,755,95042,743,623 TOTAL ASSETS $ 47,344,487$ 48,228,277 LIABILITIES AND SHAREHOLDERS' EQUITYCurrent LiabilitiesAccounts payable $ 429,405$ 487,457 Income taxes payable 358,949447,379 Debt, current —399,636 Commercial paper notes 548,720547,738 Accrued liabilities 1,353,5681,106,070 Total current liabilities 2,690,6422,988,280 Non-current LiabilitiesLong-term debt 6,648,4176,634,313 Deferred income taxes 2,379,5752,624,392 Income taxes payable 96,354260,486 Other non-current liabilities 518,879544,489 Total non-current liabilities 9,643,22510,063,680 Shareholders' EquityPreferred stock, $1.00 par value, 471,934 shares authorized, none outstanding —— Common stock, $0.16 2/3 par value, 1,200,000,000 shares authorized, 496,248,196 shares outstanding (496,296,854 on November 2, 2024) 82,71082,718 Capital in excess of par value 24,885,20425,082,243 Retained earnings 10,210,33810,196,612 Accumulated other comprehensive loss (167,632)(185,256) Total shareholders' equity 35,010,62035,176,317 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 47,344,487$ 48,228,277 ANALOG DEVICES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Three Months EndedSix Months EndedMay 3, 2025May 4, 2024May 3, 2025May 4, 2024 Cash flows from operating activities: Net income $ 569,770$ 302,242$ 961,086$ 764,969 Adjustments to reconcile net income to net cash provided by operations: Depreciation 100,33488,824198,781173,172 Amortization of intangibles 400,273439,473817,429880,376 Stock-based compensation expense 72,83158,396150,405128,211 Deferred income taxes (89,916)(62,199)(149,370)(164,348) Other 5,0028,6874,20313,370 Changes in operating assets and liabilities (238,816)(27,570)(36,247)150,935 Total adjustments 249,708505,611985,2011,181,716 Net cash provided by operating activities 819,478807,8531,946,2871,946,685 Cash flows from investing activities: Purchases of short-term available-for-sale investments —(424,117)—(424,117) Maturities of short-term available-for-sale investments 372,778—372,778— Additions to property, plant and equipment, net (90,268)(188,189)(239,246)(411,167) Proceeds from sale of property, plant and equipment, net 58,892—58,892— Payments for acquisitions, net of cash acquired ——(45,652)— Other (13,209)10,229(12,880)14,106 Net cash provided by (used for) investing activities 328,193(602,077)133,892(821,178) Cash flows from financing activities: Proceeds from debt —1,087,856—1,087,856 Debt repayments (399,998)—(399,998)— Proceeds from commercial paper notes 2,347,0642,603,9074,316,3405,383,401 Payments of commercial paper notes (2,346,747)(2,600,116)(4,315,358)(5,382,390) Repurchase of common stock (248,646)(222,381)(409,014)(402,732) Dividend payments to shareholders (491,022)(456,142)(947,360)(882,218) Proceeds from employee stock plans 19,81514,51761,56264,336 Other (1,896)2,718(1,458)(12,126) Net cash (used for) provided by financing activities (1,121,430)430,359(1,695,286)(143,873) Net increase in cash and cash equivalents 26,241636,135384,893981,634 Cash and cash equivalents at beginning of period 2,349,9941,303,5601,991,342958,061 Cash and cash equivalents at end of period $ 2,376,235$ 1,939,695$ 2,376,235$ 1,939,695 ANALOG DEVICES, INC. REVENUE TRENDS BY END MARKET (Unaudited) (In thousands) The categorization of revenue by end market is determined using a variety of data points including the technical characteristics of the product, the "sold to" customer information, the "ship to" customer information and the end customer product or application into which our product will be incorporated. As data systems for capturing and tracking this data and our methodology evolves and improves, the categorization of products by end market can vary over time. When this occurs, we reclassify revenue by end market for prior periods. Such reclassifications typically do not materially change the sizing of, or the underlying trends of results within, each end market. Three Months EndedMay 3, 2025May 4, 2024Revenue% of Revenue1Y/Y%Revenue% of Revenue1 Industrial $ 1,157,74744 %17 %$ 991,44646 % Automotive 849,50532 %24 %684,10232 % Consumer 317,75612 %30 %244,94711 % Communications 315,06012 %32 %238,54411 % Total revenue $ 2,640,068100 %22 %$ 2,159,039100 %Six Months EndedMay 3, 2025May 4, 2024Revenue% of Revenue1Y/Y%Revenue% of Revenue1 Industrial $ 2,229,83744 %2 %$ 2,181,82847 % Automotive 1,584,53431 %11 %1,433,58631 % Consumer 634,66713 %23 %514,06311 % Communications 614,20412 %13 %542,26612 % Total revenue $ 5,063,242100 %8 %$ 4,671,743100 % 1) The sum of the individual percentages may not equal the total due to rounding. ANALOG DEVICES, INC. RECONCILIATION OF GAAP TO NON-GAAP RESULTS (Unaudited) (In thousands, except per share amounts) Three Months EndedSix Months EndedMay 3, 2025May 4, 2024May 3, 2025May 4, 2024 Gross margin $ 1,611,610$ 1,180,035$ 3,041,913$ 2,653,976 Gross margin percentage 61.0 %54.7 %60.1 %56.8 % Acquisition related expenses 220,277259,641458,109519,525 Adjusted gross margin $ 1,831,887$ 1,439,676$ 3,500,022$ 3,173,501 Adjusted gross margin percentage 69.4 %66.7 %69.1 %67.9 % Operating expenses $ 933,666$ 793,912$ 1,872,656$ 1,681,889 Percent of revenue 35.4 %36.8 %37.0 %36.0 % Acquisition related expenses (188,015)(190,200)(376,030)(382,622) Special charges, net (1,745)(5,977)(65,632)(22,117) Adjusted operating expenses $ 743,906$ 597,735$ 1,430,994$ 1,277,150 Adjusted operating expenses percentage 28.2 %27.7 %28.3 %27.3 % Operating income $ 677,944$ 386,123$ 1,169,257$ 972,087 Operating margin 25.7 %17.9 %23.1 %20.8 % Acquisition related expenses 408,292449,841834,139902,147 Special charges, net 1,7455,97765,63222,117 Adjusted operating income $ 1,087,981$ 841,941$ 2,069,028$ 1,896,351 Adjusted operating margin 41.2 %39.0 %40.9 %40.6 % Nonoperating expense (income) $ 52,016$ 61,520$ 107,753$ 134,066 Acquisition related expenses 2,1502,1504,3004,300 Adjusted nonoperating expense (income) $ 54,166$ 63,670$ 112,053$ 138,366 Income before income taxes $ 625,928$ 324,603$ 1,061,504$ 838,021 Acquisition related expenses 406,142447,691829,839897,847 Special charges, net 1,7455,97765,63222,117 Adjusted income before income taxes $ 1,033,815$ 778,271$ 1,956,975$ 1,757,985 Provision for income taxes $ 56,158$ 22,361$ 100,418$ 73,052 Effective income tax rate 9.0 %6.9 %9.5 %8.7 % Tax related items 57,57359,929122,635124,959 Adjusted provision for income taxes $ 113,731$ 82,290$ 223,053$ 198,011 Adjusted tax rate 11.0 %10.6 %11.4 %11.3 % Diluted EPS $ 1.14$ 0.61$ 1.93$ 1.53 Acquisition related expenses 0.820.901.661.80 Special charges, net —0.010.130.04 Tax related items (0.12)(0.12)(0.25)(0.25) Adjusted diluted EPS* $ 1.85$ 1.40$ 3.48$ 3.13 * The sum of the individual per share amounts may not equal the total due to rounding. ANALOG DEVICES, INC. RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW (Unaudited) (In thousands) Trailing Twelve MonthsThree Months EndedMay 3, 2025May 3, 2025Feb. 1, 2025Nov. 2, 2024Aug. 3, 2024 Revenue $ 9,818,656$ 2,640,068$ 2,423,174$ 2,443,205$ 2,312,209 Net cash provided by operating activities $ 3,852,131$ 819,478$ 1,126,809$ 1,050,817$ 855,027 % of Revenue 39 %31 %47 %43 %37 % Capital expenditures $ (558,542)$ (90,268)$ (148,978)$ (165,410)$ (153,886) Free cash flow $ 3,293,589$ 729,210$ 977,831$ 885,407$ 701,141 % of Revenue 34 %28 %40 %36 %30 % ANALOG DEVICES, INC. RECONCILIATION OF PROJECTED GAAP TO NON-GAAP RESULTS (Unaudited) Three Months Ending August 2, 2025ReportedAdjusted Revenue $2.75 Billion $2.75 Billion (+/- $100 Million)(+/- $100 Million) Operating margin 27.2 %41.5 %(1)(+/-150 bps)(+/-100 bps) Nonoperating expenses ~ $55 Million~ $55 Million Tax rate 11% - 13%11% - 13% (2) Earnings per share $1.23$1.92 (3)(+/- $0.10)(+/- $0.10) (1) Includes $391 million of adjustments related to acquisition related expenses as previously defined in the Non-GAAP Financial Information section of this press release. (2) Includes $51 million of tax effects associated with the adjustment for acquisition related expenses noted above. (3) Includes $0.69 of adjustments related to the net impact of acquisition related expenses and the tax effects on those items. For more information, please contact: Jeff Ambrosi781-461-3282Senior Director, Investor View original content to download multimedia: SOURCE Analog Devices, Inc. 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