Analog Devices, Inc. (NASDAQ:ADI) saw its stock climb more than 4% in premarket trading Wednesday after reporting third-quarter results that outpaced Wall Street estimates and issuing stronger-than-expected guidance for the current quarter.
For Q3, the semiconductor maker delivered adjusted earnings per share of $2.05, above the $1.95 consensus. Revenue reached $2.88 billion, topping expectations of $2.76 billion and marking a 25% year-over-year increase. The company credited the strong performance to broad-based double-digit growth across its end markets, despite continued geopolitical headwinds.
“Despite geopolitical challenges, ADI’s third-quarter revenue and earnings per share exceeded the high end of our expectations,” said CEO and Chair Vincent Roche. “While tariffs and trade fluctuations are creating market uncertainty, the demand for ADI’s products remains robust.”
Looking to the fourth quarter, the company guided for adjusted EPS between $2.12 and $2.32, with the midpoint of $2.22 above analyst expectations of $2.03. Revenue is forecast in the range of $2.9 billion to $3.1 billion, with the midpoint of $3 billion surpassing the consensus estimate of $2.82 billion.
Analog Devices highlighted its healthy balance sheet, reporting trailing 12-month operating cash flow of $4.2 billion and free cash flow of $3.7 billion, equivalent to 40% and 35% of revenue, respectively. In the third quarter alone, the company returned $1.6 billion to shareholders through $0.5 billion in dividends and $1.1 billion in buybacks.
CFO Richard Puccio added, “We closed the third quarter with continued backlog growth and healthy bookings trends, notably in the Industrial end market. Our favorable third quarter results and outlook for continued growth in the fourth quarter position us well to finish fiscal 2025 from a position of strength.”
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