Analog Devices Q3 Earnings: Revenue And EPS Beat, CFO Highlights Improved Inventory And Order Momentum For Q4

Analog Devices, Inc. ADI stock traded higher Wednesday after the company reported fiscal third-quarter results.

The company’s revenue declined 25% year-on-year to $2.31 billion, beating the analyst consensus estimate of $2.27 billion. Adjusted EPS of $1.58 beat the analyst consensus estimate of $1.50.

Analog Devices’ Industrial revenue declined by 37% year-on-year to $1.06 billion. Automotive revenue decreased 8% Y/year-on-year to $670.3 million.

Communications revenue declined by 26% to $266.6 million, and Consumer revenue increased by 3% to $316.6 million.

The adjusted gross margin declined by 430 bps to 67.9% as lower revenue weighed on the profits. The adjusted operating margin fell by 660 bps to 41.2%.

Analog Devices held $2.55 billion in cash and equivalents as of August 3, 2024, generating $855.0 million in operating cash flow.

“Improved customer inventory levels and order momentum across most of our markets position us to grow again sequentially in our fourth quarter, increasing our confidence that we are past the trough of this cycle. However, economic and geopolitical uncertainty continues to limit the pace of the recovery,” said Richard Puccio, CFO.

Outlook: Analog Devices expects fourth-quarter revenue of $2.40 billion, +/- $100 million, versus the consensus of $2.38 billion. The company projects adjusted EPS of $1.63, +/-$0.10, against the consensus of $1.62.

Analog Devices stock gained over 26% in the last 12 months.

Price Action: ADI stock traded higher by 4.70% at $234.00 premarket at the last check Wednesday.