Analog Devices, Inc. (ADI, Financial), a leading global analog chip manufacturer, reported fourth-quarter earnings and revenue that exceeded Wall Street expectations. The company's management noted positive progress in chip orders, particularly for electric vehicles and industrial applications, suggesting a potential recovery in demand that has been weak since the Federal Reserve's rate hikes in 2022.
For the fourth quarter, ADI reported a GAAP net income of $478.1 million, or $0.96 per share, surpassing analysts' expectations of $0.84 per share. Adjusted non-GAAP earnings per share were $1.67, also beating the expected $1.64. Although overall revenue fell 10% year-over-year to $2.44 billion, it still exceeded the company's guidance and analysts' forecast of $2.41 billion.
All end markets, including industrial, automotive, communications, and consumer electronics, showed sequential growth. Notably, consumer electronics analog chip revenue grew by over 30% year-over-year, indicating a recovery in demand for PCs and smartphones.
After a brief decline in chip bookings in the third quarter, orders rebounded steadily in the fourth quarter, especially in the electric vehicle market. While macroeconomic uncertainties still pose challenges, ADI remains optimistic about growth in 2025.
ADI's latest forecast for the first quarter of fiscal year 2025 anticipates revenue between $2.25 billion and $2.45 billion, exceeding the consensus estimate of $2.34 billion. Adjusted EPS is projected to be between $1.43 and $1.63, with the upper range surpassing analysts' expectations of $1.50 to $1.55.
As a key player in the analog chip industry, ADI provides solutions for various sectors, including industrial automation and electric vehicles. The company's strong performance and positive outlook have led to a pre-market stock surge of over 7%.
