Analog Devices has reported Q1 revenues of $2.42 billion down just 4% on Q1 2024.
When the results are adjusted for an extra week trading in Q1 2024, the 2025 performance represents a 4% increase and ADI’s first year over year growth since Q2 2023.
“ADI delivered first quarter revenue, profitability, and earnings per share above the midpoint of our outlook, despite the challenging macro and geopolitical backdrop,” said Vincent Roche, CEO and Chair. “Our recovery is being propelled by improving cyclical dynamics and numerous new wins across our franchise converting to revenue. We remain firmly committed to delivering ever higher levels of value for customers through differentiated innovation and customer experience, coupled with an agile and resilient supply chain.”
Breaking down the business segments Richard Puccio, ADI’s Chief Financial Officer commented: “Industrial represented 44% of our first quarter revenue, finishing up 1% sequentially. In addition, we are seeing stronger demand in our automatic test and aerospace and defence businesses, each of which were up year-over-year. Automotive represented 30% of quarterly revenue, finishing up 2% sequentially.”
“Our leading connectivity and functionally safe power solutions were each up double digits year-over-year once again, reflecting secular content growth and greater share position,” Puccio continued. “Communications represented 12% of quarterly revenue, finishing up 6% sequentially. Wireline, which makes up roughly 2/3 of our total communications business, was up double digits sequentially and year-over-year, driven by data centre infrastructure buildouts fuelled by AI demand.
“Conversely, our wireless revenue continues to see demand challenges,” Puccia added.
ADI’s consumer represented 13% of quarterly revenue, and finished down 15% sequentially, reflecting seasonal latency.
“Our second consecutive quarter of robust year-over-year growth reflects our greater share and stronger content position across a diversified list of application,” said Puccio.
“Bookings continued to show gradual improvement during the first quarter with strength in Industrial and Automotive positioning us to grow sequentially and year-over-year in our second fiscal quarter. We remain confident that fiscal 2025 represents a return to growth for ADI.”
Conceding that the magnitude and duration of the semiconductor cycle has surprised many of us, Vincent Roche asserted: “We believe ADI has entered and is well positioned for sustained recovery. Throughout the cycle, we invested diligently to enhance and leverage our hybrid manufacturing model to support the dynamic needs of our customers, both big and small.
“We work closely with our customers to be responsive to their evolving business needs and map factory starts to true end demand. As a result, inventory levels have largely normalised and our partnership approach with our customers throughout the volatility of the past several years has enabled us to balance supply and real demand.”
Concluded Roche: “While the macro backdrop will continue to influence the pace of our recovery, the signals we monitor from lean channel inventories to gradual bookings improvements over the past 18 months. support our view that we’ve passed the cyclical trough, and the tide has turned in our favour.”
