Despite economic uncertainty, Analog Devices reported record 21% first fiscal quarter revenue growth year-over-year thanks to demand for industrial and automotive chips.
The semiconductor company tallied $3.25 billion in revenues for the quarter ended Jan. 28 and free cash flow of $4.3 billion. Earnings jumped by 42% year-over-year and both earnings and revenues beat analyst predictions.
As a result, shares climbed more than 6%, reaching 194.40 Wednesday afternoon. GlobalFoundries saw a similar climb in shares after positive earnings results on Tuesday, also on growth in automotive and industrial IoT and related areas.
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“Despite the macro uncertainty, demand remains resilient in our industrial and automotive markets, driven by continued momentum across secular growth areas, such as automation and electrification,” CEO Vincent Roche said in a statement.
“Looking ahead, pervasive sensing, AI-driven edge computing and ubiquitous connectivity are enabling new capabilities, applications and markets at the Intelligent Edge,” he added. “ADI, the bridge between the physical and digital worlds, is well positioned to deliver breakthough innovations that positively impact society and unlock long-term value for all stockholders.”
The company is forecasting second fiscal quarter revenue of $3.2 billion, ahead of analyst forecasts.
ADI is second behind Texas Instruments in rankings of the world’s largest analog chip makers with about 13% of the market compared to TI’s 20%. ADI bought Maxim Integrated in August 2018 to gain opportunities in sensor-to-cloud and DC to 100 gigahertz, among other categories. ADI’s analog sales are usually 50% industrial and 20% automotive. Automotive is expected to be a bright spot for various chipmakers in 2023 according to analysts at EY and elsewhere, while chips for PC’s, smartphones and even servers will slow.
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