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Analog Devices' FQ1 guidance light, shares -3.9% AH

  • In addition to missing FQ4 revenue estimates (while beating on EPS), Analog Devices (ADI) is guiding for FQ1 revenue to be down 5%-10% Q/Q, and for EPS to be in a range of $0.44-$0.52. That's below a consensus for a sub-1% revenue increase and EPS of $0.56.
  • The analog/mixed-signal chipmaker says it's "entering a slower seasonal period, with customer shutdowns and inventory reductions coinciding with the holidays in December and January."
  • FQ4 gross margin was 65.6%, +110 bps Q/Q and +180 bps YY, and above guidance of 65%. However, GM is expected to fall to a range of a 64%-65% in FQ1, no doubt thanks to the revenue decline.
  • Consumer chip sales were weak, falling 31% Y/Y after dropping just 6% in FQ3. Automotive was healthy (STMicroelectronics can relate), rising 19% vs. 5% in FQ3. Industrial +2% vs. -3%, telecom -2% vs. +1%.
  • Converter sales (45% of revenue) were flat Y/Y, amplifier/RF +1%, power management & reference -3%, signal processing (DSPs/embedded processors) +6%. "Other analog" was a weak spot, with sales falling 18%.
  • CC at 5PM ET. FQ4 results, PR.
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