Analog Devices Q4: 16% Revenue Decline With Industrial Slump And Automotive Gain

Analog Devices, Inc ADI reported a fourth-quarter FY23 revenue decline of 16% year-on-year to $2.72 billion, beating the consensus of $2.70 billion

Adjusted EPS of $2.01 beat the consensus of $2.00.

Analog Devices' Industrial revenue declined by 20.4% Y/Y to $1.35 billion. Automotive revenue increased 13.8% Y/Y to $731.4 million.

Communications revenue declined by 32% to $340.2 million, and Consumer revenue decreased by 28.1% to $291.4 million.

The adjusted gross margin declined by 380 bps to 70.2% as lower revenue weighed on the profits. The adjusted operating margin fell by 640 bps to 44.7%.

Analog Devices held $958.1 million in cash and equivalents, generating $1.19 billion in operating cash flow.

Dividend: The board declared a quarterly cash dividend of $0.86 per share. The dividend will be paid on December 14, 2023, to all shareholders of record at the close of business on December 4, 2023.

"For the year, 2023 was our third consecutive year of record revenue, led by the strength of our Industrial and Automotive businesses," said Vincent Roche, CEO and Chair.

"As outlined last quarter, we expect customer inventory digestion to persist into the first half of the year, a reflection of our return to normal lead times and the challenging macro landscape."

Outlook: Analog Devices sees Q1 revenue of $2.50 billion, +/- $100 million, vs. the consensus of $2.68 billion.

The company sees adjusted EPS of $1.70, +/-$0.10, vs. the consensus of $1.90.

Price Action: ADI shares traded higher by 0.14% at $184.08 on the last check Tuesday.

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