Analog Devices beats Q4 targets on chip demand recovery from auto industry
Nov 26 (Reuters) -Chipmaker Analog Devices ADI.O topped analysts' estimates for fourth-quarter revenue and profit on Tuesday, helped by strong demand for its semiconductors used in consumer electronics and a recovery in orders from the auto industry.
Shares of the Wilmington, Massachusetts-based company rose 7% in premarket trading.
Demand for consumer electronics has recovered from a post-pandemic lull, while trends in the auto segment are also improving.
The auto industry had been grappling with an inventory glut due to sluggish demand, translating to lower production and fewer orders for semiconductors, which hurt business at Analog in the past few quarters.
The auto segment accounts for 29% of the company's business, and the consumer unit, about 16%.
"After a brief decline in overall bookings during our third quarter, orders picked up steadily throughout the fourth quarter, particularly in the automotive end market," CFO Richard Puccio said.
Revenue at Analog Devices' consumer segment jumped 31% to $379.7 million in the quarter ended Nov. 2, above analysts' average estimate of $346.6 million, according to data compiled by LSEG.
Its auto segment revenue fell 2% to $717 million, but beat analysts' average estimate of $653.8 million.
Analog Devices' per-share profit of $1.67 beat estimates of $1.64, while its revenue of $2.44 billion topped estimates of $2.41 billion.
Rival Texas Instruments TXN.O also beat third-quarter profit estimates last month, helped by a recovery in orders partly due to improving demand from China's auto market.
For the first quarter of 2025, Analog Devices projected revenue of $2.35 billion, plus or minus $100 million, in line with estimates.
It also forecast adjusted per-share earnings of $1.53 at the midpoint, which was below Wall Street estimates of $1.56.
Reporting by Kritika Lamba in Bengaluru; Editing by Shinjini Ganguli
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