Analog Devices Predicts Strong Q4 as Demand Recovers

Positive Q4 Outlook

Analog Devices (NASDAQ:ADI) forecasted strong fourth-quarter results on Wednesday, anticipating revenue and profit figures above Wall Street expectations. The company is experiencing a rebound in demand for its chips used in consumer electronics, driven by a reduction in surplus chip inventory across various sectors, including communication, consumer, and industrial.

Quarterly Performance

For the third quarter, Analog Devices reported consumer segment revenue of $316.6 million, exceeding analysts’ average estimate of $289.3 million, according to LSEG data. The company’s third-quarter profit of $1.58 per share also surpassed the LSEG estimate of $1.51 per share. Following this performance, shares of Wilmington, Massachusetts-based Analog Devices rose 1.3% in premarket trading.

Q4 Expectations

Looking ahead, Analog Devices expects fourth-quarter revenue of $2.40 billion, plus or minus $100 million, surpassing LSEG estimates of $2.37 billion. The company also forecasts adjusted earnings per share of $1.63, plus or minus 10 cents, compared to estimates of $1.62. This optimistic outlook follows strong results from rival chipmaker Texas Instruments.

Challenges and Market Conditions

Despite the positive forecast, Analog Devices CFO Richard Puccio highlighted ongoing economic and geopolitical uncertainties that could impact the pace of recovery. Revenue from the company’s industrial segment, the largest by revenue, was reported at $1.06 billion, slightly below analysts’ expectations of $1.07 billion.

Analog Devices continues to supply semiconductors to a range of industries, including aerospace, automotive, communications, digital healthcare, and industrial automation.

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