Key Takeaways
- Analog Devices beat third-quarter profit and sales estimates as it sees the slump in the chip sector ending.
- The company posted sequential gains in revenue from its Industrial, Consumer, and Communications units.
- CFO Richard Puccio said better customer inventory levels and gains in orders point to a recovery.
Analog Devices (ADI) shares advanced in intraday trading Wednesday after the semiconductor maker posted better-than-expected results as it benefited from a rebound in the industry.
The company reported fiscal 2024 third-quarter adjusted earnings per share (EPS) of $1.58, with revenue falling 25% year-over-year to $2.31 billion. Both exceeded consensus estimates of analysts polled by Visible Alpha.
Sales were higher from the second quarter at the firm’s Industrial, Consumer, and Communications divisions.
CFO Says ‘Past the Trough of This Cycle’
Chief Financial Officer (CFO) Richard Puccio explained that improved customer inventory levels and order momentum in most of the company’s markets were “increasing our confidence that we are past the trough of this cycle.” However, Puccio warned that “economic and geopolitical uncertainty continues to limit the pace of the recovery.”
Analog Devices sees current-quarter adjusted EPS of $1.63, plus or minus $0.10, and anticipates revenue of $2.40 billion, plus or minus $100 million. The averages of analysts surveyed by Visible Alpha are $1.62 and $2.38 billion, respectively.
Shares of Analog Devices rose more than 3% to $231.30 as of 10:45 a.m. ET Wednesday. They are up about 16% in 2024.