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ADI Q1 Earnings Beat: Will a Strong Guidance Lift the Stock?

In This Article:

Analog Devices ADI reported first-quarter fiscal 2025 non-GAAP earnings of $1.63 per share, which surpassed the Zacks Consensus Estimate by 5.8%. The bottom line came at the higher end of management’s guidance but declined 6% year over year

Analog Devices’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 4.86%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Analog Devices’ first-quarter fiscal 2025 revenues of $2.42 billion beat the Zacks Consensus Estimate by 2.5% and came in line with management’s guidance.

While the consumer end market delivered a strong performance, the persistent weakness in the industrial, communications and automotive sectors has resulted in a 3.6% year-over-year decline in the top line.

However, the better-than-expected financial results prompted Analog Devices to provide optimistic guidance for the second quarter of fiscal 2025. Its second-quarter top line surpassed the Zacks Consensus Estimate while the bottom line matched the same.

The strong outlook is likely to boost ADI’s share price, which already surged 27.6% in the past year, outperforming the Zacks Semiconductor - Analog and Mixed industry's return of 4.6%.

Analog Devices, Inc. Price, Consensus and EPS Surprise

Analog Devices, Inc. price-consensus-eps-surprise-chart | Analog Devices, Inc. Quote

Analog Devices’ Q1 Details

Stronger-than-expected performance in the consumer market was suppressed by softness in three other segments — industrial, communications and automotive.

Industrial: This end market generated revenues of $1.08 billion (accounting for 44% of the total revenues), which fell 10% year over year. The figure beat the Zacks Consensus Estimate of $1.02 million.

Communications:Revenues from the market were $289.86 million (12% of revenues), which decreased 4% from the year-ago quarter. The figure beat the Zacks Consensus Estimate of $273.3 million.

Automotive: Revenues from the market summed up to $732.5 million (30% of revenues), down 2% from the year-ago quarter. The figure missed the Zacks Consensus Estimate of $744.9 million.

Consumer: The market generated revenues of $323 million (13% of revenues), reflecting 19% growth from the year-ago quarter. The figure beat the Zacks Consensus Estimate of $309.7 million.

The adjusted gross margin contracted 20 basis points (bps) from the year-ago quarter to 68.8%. The adjusted operating margin was 40.5% in the reported quarter, which contracted 150 bps from the year-ago quarter.

Analog Devices’ Balance Sheet & Cash Flow

As of Feb. 1, 2025, cash and cash equivalents, and short-term investments were $2.72 billion, up from $2.36 billion as of Nov. 2, 2024.