Analog Devices, Inc. (ADI) reported record revenues of $3.62 billion for the most recent quarter, representing a 37% year-over-year increase. Earnings per share rose to $3.09, fueled by robust demand across all end markets, particularly in Communications, which saw revenues surge by 79%. Notably, the data center segment accounted for over 75% of the Communications revenue, experiencing more than 90% growth year-over-year.
Management expressed confidence in sustained growth through fiscal 2027, driven by increased demands for AI systems that require higher power density and faster data movement. ADI’s gross margin expanded to 73% on an adjusted basis, up 360 basis points year-over-year, while adjusted operating margin reached 49%, an increase of 780 basis points. The company is also furthering its AI power offerings through the acquisition of Empower Semiconductor, enhancing its capabilities in chip-level power management.
Year-to-date, ADI’s shares have risen by 46.4%, compared to a 62.8% increase in the Semiconductor – Analog and Mixed industry. The Zacks Consensus Estimate projects ADI’s earnings to grow 29.8% and 11.8% in fiscal 2026 and 2027, respectively.
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