Analog Devices Beats on Both Top and Bottom Lines

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Analog Devices (NAS: ADI) reported earnings on May 22. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended May 5 (Q2), Analog Devices beat expectations on both revenue and earnings per share.

Compared to the prior-year quarter, both revenue and GAAP earnings per share shrank.


Margins dropped across the board.

Revenue details
Analog Devices booked revenue of $675.1 million. The 22 analysts polled by S&P Capital IQ looked for revenue of $665.7 million on the same basis. GAAP-reported sales were 15% lower than the prior-year quarter's $790.8 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.53. The 21 earnings estimates compiled by S&P Capital IQ anticipated $0.51 per share. GAAP EPS of $0.53 for Q2 were 32% lower than the prior-year quarter's $0.78 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 65.2%, 240 basis points worse than the prior-year quarter. Operating margin was 31.5%, 620 basis points worse than the prior-year quarter. Net margin was 24.1%, 650 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $695.3 million. On the bottom line, the average EPS estimate is $0.57.

Next year's average estimate for revenue is $2.75 billion. The average EPS estimate is $2.18.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 383 members rating the stock outperform and 31 members rating it underperform. Among 113 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 105 give Analog Devices a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Analog Devices is outperform, with an average price target of $42.60.

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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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