It has been about a month since the last earnings report for Analog Devices (ADI) . Shares have added about 0.4% in that time frame, underperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Analog Devices due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. Analog Devices Q4 Earnings & Revenues ...

Analog Devices (ADI) is a leading semiconductor company offering high-performance analog, mixed-signal and digital signal processing technologies. I believe Analog Devices’s business has already passed the bottom of end-market cycles, and automotive and industrial markets are anticipated to recover inMore than 15 years of professional investment experience in global equities across all sectors. My investment style is fundamental, bottom-up, long-term, and quality growth-oriented. I am seeking companies spec ...

Analog Devices, Inc. (ADI) has earned a solid reputation as a leader in analog, mixed-signal and digital signal processor integrated circuits. Yet, with a forward P/E ratio of 29.58X, higher than the Zacks Semiconductor – Analog and Mixed industry average of 27.06X, investors are questioning whether the stock’s premium valuation is justified in the current market. The answer, for now, seems to favor patience.Image Source: Zacks Investment ResearchThis year, Analog Devices shares have struggled to keep pace ...

Analog Devices (ADI) shares have gained 8.3% year to date (YTD), outperforming the Zacks Semiconductor - Analog and Mixed industry’s decline of 3.3%. This outperformance results from its strong portfolio and strategic alliances, propelling it forward across its end markets, including communications, automotive, industrial and consumer.The endeavours of Analog Devices to incorporate artificial intelligence technology into their products to provide a better customer experience are advantageous. Increasing pow ...

Analog Devices, Inc. (NASDAQ:ADI) UBS Global Technology and AI Conference December 3, 2024 12:15 PM ET Company Participants Richard Puccio - CFO Michael Lucarelli - VP of Investor Relations and FP&A Conference Call Participants Timothy Arcuri - UBS Timothy Arcuri Good morning. We're going to get started. I'm Tim Arcuri. I'm the semiconductor analyst here at UBS. Very pleased to have ADI with us. With ADI, we have Rich Puccio, who is the CFO; and we have Mike Lucarelli, who is the IR. So, thank you for -- th ...

Analog Devices TodayADIAnalog Devices$218.05 +0.88 (+0.41%) 52-Week Range$179.63▼$244.14Dividend Yield1.69%P/E Ratio66.28Price Target$249.33Add to WatchlistAnalog Devices NASDAQ: ADI did not have a robust quarter in Q4 2024. Still, its results and guidance align with the industry outlook, which is a reversion to growth following years of inventory correction. The correction was caused by pandemic-era spending and supply-chain log jams, resulting in many OEMs overordering to combat the issues. Today's story ...

Analog Devices (ADI) reported fourth-quarter fiscal 2024 non-GAAP earnings of $1.67 per share, which surpassed the Zacks Consensus Estimate by 1.83%. The bottom line came at the midpoint of management’s guidance but declined 16.9% year over yearAnalog Devices’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 4.9%.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Analog Devices’ fourth-quarter fiscal 2024 revenues of $2.44 bill ...

Interest Rate Sensitivity - Annual interest expense would change by approximately $15.5 million and $20.5 million for each 100 basis point increase in interest rates as of November 2, 2024 and October 28, 2023, respectively[255] - Annual interest income would change by approximately $19.9 million and $9.6 million for each 100 basis point increase in interest rates as of November 2, 2024 and October 28, 2023, respectively[256] - A hypothetical 100 basis point increase in interest rates would increase the swap payable by approximately $54.0 million with a corresponding adjustment to the carrying value of the related debt[257] - The fair value of the 2024 Notes, due October 2024, would decrease to $495,058 from $499,473 with a hypothetical 100 basis point increase in interest rates[258] Foreign Currency Exchange Rate Sensitivity - An immediate 10% unfavorable movement in foreign currency exchange rates would result in approximately $32.2 million of losses and $66.5 million of losses as of November 2, 2024 and October 28, 2023, respectively[260] - The fair value of forward exchange contracts as of November 2, 2024 would change to $31,564 after a 10% unfavorable movement in foreign currency exchange rates[262] - The fair value of forward exchange contracts as of November 2, 2024 would change to $(45,922) after a 10% favorable movement in foreign currency exchange rates[262] Debt and Derivatives - The company had $7.1 billion in principal amount of senior unsecured notes outstanding as of November 2, 2024, with a fair value of $6.3 billion[258] - The company had $1.0 billion notional of fixed for floating interest rate swaps outstanding as of November 2, 2024, with the swap payable having a fair value of $36.9 million[257] - The company had $547.7 million of commercial paper notes outstanding as of November 2, 2024, with a fair value of $547.7 million[258] Price Protection Credits and Rights of Return - Sales to distributors in 2024 were $5.5 billion, net of expected price protection credits and rights of return[270] - The liability balance for price protection credits and rights of return as of November 2, 2024, was $508.7 million, with the majority related to price protection credits[270] - The calculation of price protection credits involves subjective management assumptions about future economic conditions, which can materially affect the recognized amount[270] - The company's process for calculating price protection credits was evaluated, including testing controls over management's assumptions and data accuracy[272] - Audit procedures included inspecting distributor agreements, testing data completeness, and evaluating significant assumptions used in estimating price protection credits[273] - The company's retrospective review analysis of actual price protection credits claimed by distributors was inspected and tested[273] - Sensitivity analyses were performed to assess the impact of significant assumptions on price protection credits[273] - The company considered new information that could significantly change the estimated future price protection credits[273]

Financial Data and Key Metrics - Revenue for fiscal year 2024 was $9.4 billion, with earnings per share (EPS) of $6.38 [6] - Operating margin for the year was 41%, and free cash flow margin improved to 33% from 29% in fiscal 2023 [7] - Q4 revenue was $2.44 billion, a 6% sequential increase but a 10% year-over-year decline [22] - Q4 EPS was $1.67, above the midpoint of the outlook [26] - Operating cash flow for fiscal 2024 was $3.8 billion, with free cash flow of $3.1 billion [28] Business Line Performance - **Industrial**: Represented 44% of Q4 revenue, up 2% sequentially but down 21% year-over-year. Full-year Industrial revenue decreased 35% from fiscal 2023, with strong performance in AI-related test, Aerospace, and Defense [22] - **Automotive**: Represented 29% of Q4 revenue, up 4% sequentially but down 2% year-over-year. Full-year Automotive revenue declined 2%, with growth in functionally safe power and connectivity franchises offset by inventory digestion [23] - **Communications**: Represented 11% of Q4 revenue, up 4% sequentially but down 18% year-over-year. Full-year Communications revenue decreased 33%, with wireline outperforming wireless [24] - **Consumer**: Represented 16% of Q4 revenue, up 22% sequentially and 31% year-over-year. Full-year Consumer revenue decreased 1%, with growth in wearables and portable applications [24][25] Market Performance - **China**: Strong demand in China, particularly in the automotive sector, drove sequential growth in Q4. China represents about 80% of the company's revenue in the region, with industrial and automotive being the largest contributors [36][39] - **Global**: Aerospace and Defense remained resilient, with double-digit growth expected in fiscal 2025. Automotive demand improved in the U.S., driven by battery management systems (BMS) and wireless BMS solutions [14][36] Strategic Direction and Industry Competition - The company is investing in R&D, digital software, and AI to enhance its analog foundation and expand innovation capabilities. Recent launches include CodeFusion Studio and ADI Assure Trusted Edge Security Architecture [8][9] - The company is focusing on high-growth areas such as AI-related test, healthcare, and data center power, aiming for $1 billion in revenue synergies by 2027 [9] - A hybrid manufacturing model has been developed, with $2.7 billion invested in CapEx since acquiring Maxim. This model provides flexibility and resilience, with swing capacity expected to reach 70% of revenue in the coming years [18] Management Commentary on Operating Environment and Future Outlook - The company expects gradual recovery in fiscal 2025, with industrial leading the recovery, followed by consumer, communications, and automotive [41][45] - Gross margins are expected to improve as revenue grows, with a target of 70% gross margin achievable at $2.7 billion in revenue [64] - The company plans to return 100% of free cash flow to shareholders in fiscal 2025, after increasing balance sheet cash in fiscal 2024 [31] Other Important Information - Inventory levels decreased by 11 days to 167 days, with channel inventory slightly below the target range of 7-8 weeks [27] - The company returned $2.4 billion to shareholders in fiscal 2024 through dividends and share repurchases [28] Q&A Session Summary Question: Strength in the automotive sector, particularly in China [35] - **Answer**: Strong demand in China, driven by EV volume growth and share gains, contributed to the sequential improvement in Q4. The U.S. also saw growth in BMS and wireless BMS solutions [36][37] Question: Recovery trajectory for fiscal 2025 and beyond [40] - **Answer**: Industrial is expected to lead the recovery, followed by consumer, communications, and automotive. The company anticipates a return to growth in Q2 2025 [41][45] Question: Industrial segment performance and growth outlook [47] - **Answer**: Industrial revenue was lower than expected in Q4 due to weak demand and inventory reductions. However, the company expects growth to resume in fiscal 2025, driven by undershipping demand and improving macros [48][49] Question: Automotive pricing and growth areas [51] - **Answer**: Pricing remains stable, with growth expected in functionally safe power, GMSL, and A2B connectivity. BMS is expected to return to growth in fiscal 2025 [54][55] Question: Differentiation in AI and software capabilities [57] - **Answer**: The company is leveraging software to enhance its analog and mixed-signal solutions, with recent launches including CodeFusion Studio and ADI Assure for cybersecurity [58][59][60] Question: Gross margin trajectory [63] - **Answer**: Gross margins are expected to improve as revenue grows, with 70% achievable at $2.7 billion in revenue. Seasonal factors and mix will impact Q1 margins [64][65] Question: Seasonal trends and book-to-bill ratio [67] - **Answer**: Seasonal growth in Q2 is typically low to mid-single digits. Book-to-bill was slightly below 1 in Q4, reflecting seasonal trends [68] Question: Long-term growth potential and inventory cycle [72] - **Answer**: The company is well-positioned for double-digit growth through the decade, with a strong pipeline and improved customer relationships. Fiscal 2025 is expected to show progress toward fiscal 2023 levels [73] Question: Data center power management opportunities [75] - **Answer**: The company is focusing on high-end power and control solutions for data centers, with traction in optical control and energy solutions [76][77] Question: Utilization rates and margin impact [79] - **Answer**: Utilization rates have improved modestly and are expected to increase as revenue grows in fiscal 2025 [80]

Key TakeawaysAnalog Devices beat profit and sales estimates as demand for chips picked up in its fiscal fourth quarter.The company got a boost from sales of semiconductors used in the automotive sector.CFO Richard Puccio said Analog Devices continues to face "macroeconomic uncertainty." Shares of Analog Devices (ADI) advanced Tuesday as the semiconductor maker posted better-than-anticipated results on a pickup in demand for automotive chips. The company reported fiscal fourth-quarter adjusted earnings per s ...