Revenue increases to a record $863 million, non-GAAP diluted
earnings per share increases to $0.77
Analog Devices, Inc. (NASDAQ: ADI), a global leader in
high-performance semiconductors for signal processing applications,
today announced financial results for its third quarter of fiscal
year 2015, which ended August 1, 2015.
“We had a very strong third quarter, with revenue growing to a
record $863 million and earnings at the very high end of
expectations,” said Vincent Roche, President and CEO. “Once again
this quarter, our focus on sustainable innovation that bridges the
physical and digital worlds across diverse applications and
markets, coupled with strong execution throughout the Company,
delivered solid growth and profits.”
“Looking ahead, stable order rates and a positive book to bill
ratio lead us to plan for sequential growth in the fourth quarter,
and for revenue to be in the range of $880 million to $940
million.”
ADI also announced that the Board of Directors has declared a
cash dividend of $0.40 per outstanding share of common stock. The
dividend will be paid on September 9, 2015 to all shareholders of
record at the close of business on August 28, 2015.
For additional information please visit investor.analog.com.
Results for the Third Quarter of Fiscal
Year 2015
- Revenue totaled $863 million, up 5%
sequentially, and up 19% year-over-year
- GAAP gross margin of 65.9% of revenue;
Non-GAAP gross margin of 66.1% of revenue
- GAAP operating margin of 30.7% of
revenue; Non-GAAP operating margin of 34.2% of revenue
- GAAP diluted EPS of $0.68; Non-GAAP
diluted EPS of $0.77
Please refer to the schedules provided for a summary of revenue
and earnings, selected balance sheet information, and the cash flow
statement for the third quarter of fiscal year 2015, as well as the
immediately prior and year-ago quarters. Additional information on
revenue by end market is provided on Schedule D. A more complete
table covering prior periods is available at
investor.analog.com.
Outlook for the Fourth Quarter of
Fiscal Year 2015
The following statements are based on current expectations, and
as indicated, are presented on a GAAP and non-GAAP basis. These
statements are forward-looking and actual results may differ
materially, as a result of, among other things, the important
factors discussed at the end of this release. These statements
supersede all prior statements regarding our business outlook set
forth in prior ADI news releases, and ADI disclaims any obligation
to update these forward-looking statements.
GAAP
Non-GAAPAdjustments
Non-GAAP Revenue $880
to $940 million -
$880 to $940
million Gross Margin approx. 65.5%
$1.4 million (1) approx. 65.5% Operating Expenses
up 70% to 72% $238.7 million (2)
up 1% to 3% Interest & Other Expense $5.0
million - $5.0 million Tax Rate
approx. 57% to 82% - approx. 15%
Earnings per Share $0.03 to $0.11
$0.76 (3)
$0.79 to $0.87
- Reflects estimated adjustments for
amortization of purchased intangible assets and depreciation of
step up value on purchased fixed assets.
- Reflects estimated charge of
approximately $220 million associated with the conversion of the
Company’s Irish defined benefits pension plan as more fully
described in the Form 8-K filed by the Company today, $18.5 million
for amortization of purchased intangible assets, and $0.2 million
of depreciation of step up value on purchased fixed assets.
- Represents estimated impact of expenses
associated with the non-GAAP adjustments on a per share basis.
Conference Call Scheduled for 5:00 pm ET
ADI will host a conference call to discuss the third quarter
results and short-term outlook today, beginning at 5:00 pm ET.
Investors may join via webcast, accessible at investor.analog.com,
or by telephone (call 706-634-7193 ten minutes before the call
begins and provide the password "ADI").
A replay will be available two hours after the completion of the
call. The replay may be accessed for up to two weeks by dialing
855-859-2056 (replay only) and providing the conference ID:
61306923, or by visiting investor.analog.com.
Non-GAAP Financial
Information
This release includes non-GAAP financial measures that are not
in accordance with, nor an alternative to, generally accepted
accounting principles and may be different from non-GAAP measures
used by other companies. In addition, these non-GAAP measures are
not based on any comprehensive set of accounting rules or
principles.
Schedule E of this press release provides the reconciliation of
the Company’s historical non-GAAP measures to its GAAP
measures.
Management uses non-GAAP measures to evaluate the Company’s
operating performance from continuing operations against past
periods and to budget and allocate resources in future periods.
These non-GAAP measures also assist management in evaluating the
Company’s core business and trends across different reporting
periods on a consistent basis. Management also believes that
the presentation of these non-GAAP items is useful to investors
because it provides investors with the operating results that
management uses to manage the Company and enables investors and
analysts to evaluate the Company’s core business.
The following item is excluded from our non-GAAP
revenue:
Hittite Operations: The results of operation of Hittite from
July 22, 2014 through August 2, 2014 have been excluded from our
non-GAAP measures because they are not reflective of ongoing
operating results.
The following items are excluded from our non-GAAP gross
margin, non-GAAP operating expenses, non-GAAP operating income,
non-GAAP operating margin, and non-GAAP diluted earnings per
share:
Hittite Operations: The results of operation of Hittite from
July 22, 2014 through August 2, 2014 have been excluded from our
non-GAAP measures because they are not reflective of ongoing
operating results.
Acquisition-Related Expenses: Expenses incurred in the second
and third quarters of fiscal 2015 and the third quarter of fiscal
2014 as a result of the Hittite acquisition primarily include:
severance payments, expense associated with the fair value
adjustments to inventory and property, plant and equipment; and
amortization of acquisition related intangibles, which include
acquired intangibles such as purchased technology and customer
relationships. We excluded these costs from our non-GAAP measures
because they relate to a specific transaction and are not
reflective of our ongoing financial performance.
The following items are excluded from our non-GAAP operating
expenses, non-GAAP operating income, non-GAAP operating margin, and
non-GAAP diluted earnings per share:
Acquisition-Related Transaction Costs: Costs incurred as a
result of the Hittite acquisition in the second and third quarters
of fiscal 2015 and the third quarter of fiscal 2014 include
professional fees and settlement costs directly related to the
Hittite acquisition. We excluded these costs from our non-GAAP
measures because they relate to a specific transaction and are not
reflective of our ongoing financial performance.
The following items are excluded from our non-GAAP other
expense and non-GAAP diluted earnings per share:
Acquisition-Related Debt Costs: The Company incurred debt
financing costs and interest expense during the third quarter of
fiscal 2014 on its 90-day term loan facility used to finance the
Hittite acquisition. We excluded these costs from our non-GAAP
measures because they are not reflective of our ongoing financial
performance.
The following item is excluded from our non-GAAP diluted
earnings per share:
Tax-Related Items: In the third quarter of fiscal 2015, the
Company recorded $0.7 million of tax adjustments associated with
the Hittite acquisition-related expenses and transaction costs. In
the second quarter of fiscal 2015, the Company recorded $1.5
million of tax adjustments associated with the Hittite
acquisition-related expenses and transaction costs. We excluded
these tax-related items from our non-GAAP measures because they are
not associated with the tax expense on our current operating
results.
Analog Devices believes that these non-GAAP measures have
material limitations in that they do not reflect all of the amounts
associated with our results of operations as determined in
accordance with GAAP and that these measures should only be used to
evaluate our results of operations in conjunction with the
corresponding GAAP measures. In addition, our non-GAAP measures may
not be comparable to the non-GAAP measures reported by other
companies. The Company’s use of non-GAAP measures, and the
underlying methodology when excluding certain items, is not
necessarily an indication of the results of operations that may be
expected in the future, or that the Company will not, in fact,
record such items in future periods.
Investors should consider our non-GAAP financial measures in
conjunction with the corresponding GAAP measures.
About Analog Devices
Analog Devices designs and manufactures semiconductor products
and solutions. We enable our customers to interpret the world
around us by intelligently bridging the physical and digital with
unmatched technologies that sense, measure and connect. Visit
http://www.analog.com
This release may be deemed to contain forward-looking statements
intended to qualify for the safe harbor from liability established
by the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, among other things, our
statements regarding expected revenue, earnings per share, gross
margin, operating expenses, interest and other expense, tax rate,
and other financial results, expected operating leverage,
production and inventory levels, expected market trends, and
expected customer demand and order rates for our products, that are
based on our current expectations, beliefs, assumptions, estimates,
forecasts, and projections about our business and the industry and
markets in which Analog Devices operates. The statements contained
in this release are not guarantees of future performance, are
inherently uncertain, involve certain risks, uncertainties, and
assumptions that are difficult to predict, and do not give effect
to the potential impact of any mergers, acquisitions, divestitures,
or business combinations that may be announced or closed after the
date hereof. Therefore, actual outcomes and results may differ
materially from what is expressed in such forward-looking
statements, and such statements should not be relied upon as
representing Analog Devices’ expectations or beliefs as of any date
subsequent to the date of this press release. We do not undertake
any obligation to update forward-looking statements made by us.
Important factors that may affect future operating results include:
any faltering in global economic conditions or the stability of
credit and financial markets, erosion of consumer confidence and
declines in customer spending, unavailability of raw materials,
services, supplies or manufacturing capacity, changes in
geographic, product or customer mix, our ability to successfully
integrate acquired businesses and technologies, the successful
completion of the conversion of the benefits provided under our
Irish defined benefits plan to benefits provided under our Irish
defined contribution plan, adverse results in litigation matters,
and other risk factors described in our most recent filings with
the Securities and Exchange Commission. Our results of operations
for the periods presented in this release are not necessarily
indicative of our operating results for any future periods. Any
projections in this release are based on limited information
currently available to Analog Devices, which is subject to change.
Although any such projections and the factors influencing them will
likely change, we will not necessarily update the information, as
we will only provide guidance at certain points during the year.
Such information speaks only as of the original issuance date of
this release.
Analog Devices and the Analog Devices logo are registered
trademarks or trademarks of Analog Devices, Inc. All other
trademarks mentioned in this document are the property of their
respective owners.
Analog Devices, Third Quarter, Fiscal 2015
Schedule
A
Revenue and Earnings Summary (Unaudited) (In thousands,
except per-share amounts)
Three Months Ended 3Q 15 2Q
15 3Q 14 Aug. 1,
2015
May 2,
2015
Aug. 2,
2014
Revenue $ 863,365 $ 821,019 $ 727,752 Year-to-year change 19% 18%
8% Quarter-to-quarter change 5% 6% 5% Cost of sales (1)
294,328 276,197 251,462 Gross
margin 569,037 544,822 476,290 Gross margin percentage 65.9% 66.4%
65.4% Year-to-year change (basis points) 50 30 90
Quarter-to-quarter change (basis points) -50
120 -70 Operating expenses: R&D (1)
160,784 154,233 140,095 Selling, marketing and G&A (1) 120,030
117,371 132,989 Amortization of intangibles 22,954
24,210 660 Total operating expenses
303,768 295,814 273,744 Total operating expenses percentage 35.2%
36.0% 37.6% Year-to-year change (basis points) -240 170 400
Quarter-to-quarter change (basis points) -80
-230 330 Operating income 265,269 249,008
202,546 Operating income percentage 30.7% 30.3% 27.8% Year-to-year
change (basis points) 290 -140 -310 Quarter-to-quarter change
(basis points) 40 340
-390 Other expense 5,791 3,819
5,158 Income before income tax 259,478 245,189 197,388
Provision for income taxes 43,000 39,851 16,782 Tax rate percentage
16.6% 16.3% 8.5% Net
income $ 216,478 $ 205,338 $ 180,606
Shares used for EPS - basic 313,877 312,660 314,190 Shares used for
EPS - diluted 318,187 317,047 318,876 Earnings per share -
basic $ 0.69 $ 0.66 $ 0.57 Earnings per share - diluted $ 0.68 $
0.65 $ 0.57 Dividends paid per share $ 0.40 $
0.40 $ 0.37 (1) Includes stock-based compensation
expense as follows: Cost of sales $ 2,196 $ 2,207 $ 1,724 R&D $
6,839 $ 6,416 $ 5,415 Selling, marketing and G&A $ 7,329 $
7,478 $ 6,331
Analog Devices, Third Quarter,
Fiscal 2015
Schedule
B
Selected Balance Sheet Information (Unaudited) (In
thousands) 3Q 15 2Q 15 3Q
14 Aug. 1,
2015
May 2,
2015
Aug. 2,
2014
Cash & short-term investments $ 3,099,961 $ 3,074,778 $
4,932,259 Accounts receivable, net 451,511 408,510 394,762
Inventories (1) 424,475 394,494 415,098 Other current assets
173,945 167,979 181,765 Total
current assets 4,149,892 4,045,761 5,923,884 PP&E, net 631,269
629,665 609,937 Investments 40,324 39,687 32,022 Goodwill 1,640,381
1,643,614 1,631,890 Intangible assets, net 601,882 621,277 695,832
Other 70,953 68,471
79,900 Total assets $ 7,134,701 $ 7,048,475 $
8,973,465 Deferred income on shipments to distributors, net
$ 307,265 $ 295,428 $ 285,832 Other current liabilities 375,753
398,127 341,296 Long-term debt, current 374,752 374,664 1,995,398
Long-term debt, non-current 498,448 498,399 872,652 Non-current
liabilities 513,322 517,649 471,090 Shareholders' equity
5,065,161 4,964,208 5,007,197
Total liabilities & equity $ 7,134,701 $
7,048,475 $ 8,973,465
(1) Includes $2,935, $3,066, and $2,094 related to stock-based
compensation in 3Q15, 2Q15, and 3Q14, respectively.
Analog Devices, Third Quarter, Fiscal 2015
Schedule
C
Cash Flow Statement (Unaudited) (In thousands)
Three Months
Ended 3Q 15 2Q 15 3Q 14 Aug. 1,
2015
May 2,
2015
Aug. 2,
2014
Cash flows from operating activities: Net Income $ 216,478 $
205,338 $ 180,606
Adjustments to reconcile net income to net
cash provided by operations:
Depreciation 33,650 32,036 28,353 Amortization of intangibles
23,898 25,154 1,610 Stock-based compensation expense 16,364 16,101
13,470 Other non-cash activity 3,827 1,832 1,006 Excess tax benefit
- stock options (6,373 ) (11,142 ) (9,322 ) Deferred income taxes
(17,168 ) (6,481 ) (6,380 ) Changes in operating assets and
liabilities (73,537 ) 81,193
4,099 Total adjustments (19,339
) 138,693 32,836 Net cash
provided by operating activities 197,139
344,031 213,442 Percent
of total revenue 22.8 % 41.9 %
29.3 % Cash flows from investing activities:
Purchases of short-term available-for-sale investments (1,403,600 )
(1,661,176 ) (1,028,781 ) Maturities of short-term
available-for-sale investments 1,083,474 1,154,412 1,815,862 Sales
of short-term available-for-sale investments 215,998 291,900
1,298,044 Additions to property, plant and equipment (35,164 )
(49,229 ) (42,315 ) Payments for acquisitions, net of cash acquired
(6,947 ) - (1,943,704 ) Change in other assets (1,180
) (4,468 ) (340 ) Net cash (used for)
provided by investing activities (147,419 )
(268,561 ) 98,766 Cash flows
from financing activities: Proceeds from debt - - 1,995,398
Dividend payments to shareholders (125,511 ) (124,882 ) (116,098 )
Repurchase of common stock (31,340 ) (24,275 ) (57,394 ) Proceeds
from employee stock plans 19,988 52,090 36,045 Excess tax benefit -
stock options 6,373 11,142 9,322 Contingent consideration payment
(1,767 ) - (1,803 ) Change in other financing activities
4,327 (3,563 ) 5,406
Net cash (used for) provided by financing activities
(127,930 ) (89,488 ) 1,870,876
Effect of exchange rate changes on cash (509 )
32 (433 ) Net (decrease)
increase in cash and cash equivalents (78,719 ) (13,986 ) 2,182,651
Cash and cash equivalents at beginning of period
636,216 650,202 402,790
Cash and cash equivalents at end of period $ 557,497
$ 636,216 $ 2,585,441
Analog Devices, Third Quarter, Fiscal 2015
Schedule
D
Revenue Trends by
End Market (Unaudited)
The categorization of revenue by end market is determined using a
variety of data points including the technical characteristics of
the product, the “sold to” customer information, the "ship to"
customer information and the end customer product or application
into which our product will be incorporated. As data systems for
capturing and tracking this data evolve and improve, the
categorization of products by end market can vary over time. When
this occurs we reclassify revenue by end market for prior periods.
Such reclassifications typically do not materially change the
sizing of, or the underlying trends of results within, each end
market. The results below are inclusive of the Hittite acquisition
from the acquisition date, July 22, 2014.
Three Months Ended Aug 1,
2015
May 2,
2015
Aug. 2,
2014
Revenue % * Q/Q % Y/Y
% Revenue Revenue Industrial $ 384,187
44% -2% 10% $ 390,082 $ 350,683 Automotive
130,109 15% -7% 0% 139,725 130,269 Consumer 206,778 24% 89% 155%
109,243 80,948 Communications 142,291 16% -22% -14%
181,969 165,852
Total Revenue $
863,365 100% 5% 19% $
821,019 $ 727,752 * The sum of the
individual percentages does not equal the total due to rounding.
Analog Devices, Third Quarter, Fiscal 2015
Schedule
E
Reconciliation from GAAP to Non-GAAP Data (In thousands, except
per-share amounts) (Unaudited) See "Non-GAAP
Financial Information" in this press release for a description of
the items excluded from our non-GAAP measures.
Three Months Ended 3Q 15
2Q 15 3Q 14 Aug. 1,
2015
May 2,
2015
Aug. 2,
2014
GAAP Revenue $ 863,365 $
821,019 $ 727,752 Q/Q Revenue growth %
5 % 6 % 5 % Hittite
Operations - - (5,392 )
Non-GAAP Revenue $ 863,365 $
821,019 $ 722,360 Q/Q Revenue
growth % 5 % 6 % 4 %
GAAP Gross Margin $ 569,037 $
544,822 $ 476,290 Gross Margin
Percentage 65.9 % 66.4 %
65.4 % Hittite Operations - - (3,015 )
Acquisition-Related Expenses 1,307
1,520 6,837
Non-GAAP Gross
Margin $ 570,344 $
546,342 $ 480,112
Gross Margin Percentage 66.1 % 66.5
% 66.5 % GAAP Operating Expenses
$ 303,768 $ 295,814 $
273,744 Percent of Revenue 35.2 %
36.0 % 37.6 % Hittite Operations - -
(2,033 ) Acquisition-Related Expenses (23,490 ) (24,435 ) (5,284 )
Acquisition-Related Transaction Costs (5,139 )
(1,820 ) (21,123 )
Non-GAAP Operating Expenses
$ 275,139 $ 269,559
$ 245,304 Percent of
Revenue 31.9 % 32.8 % 34.0
% GAAP Operating Income/Margin $
265,269 $ 249,008 $ 202,546
Percent of Revenue 30.7 % 30.3 %
27.8 % Hittite Operations - - (982 )
Acquisition-Related Expenses 24,797 25,955 12,121
Acquisition-Related Transaction Costs 5,139
1,820 21,123
Non-GAAP
Operating Income/Margin $ 295,205
$ 276,783 $ 234,808
Percent of Revenue 34.2 % 33.7
% 32.5 % GAAP Other Expense
$ 5,791 $ 3,819 $ 5,158
Percent of Revenue 0.7 % 0.5 %
0.7 %
Acquisition-Related Debt Costs
- - (1,513 )
Non-GAAP Other Expense $ 5,791
$ 3,819 $ 3,645
Percent of Revenue 0.7 % 0.5 %
0.5 % GAAP Diluted EPS $
0.68 $ 0.65 $ 0.57 Hittite
Operations - - - Acquisition-Related Expenses 0.08 0.08 0.02
Acquisition-Related Transaction Costs 0.02 0.01 0.04
Acquisition-Related Debt Costs
- - - Acquisition-Related Tax Impact (0.00 )
(0.01 ) -
Non-GAAP Diluted EPS (1)
$ 0.77 $ 0.73
$ 0.63
(1) The sum of the individual per share amounts may not equal
the total due to rounding
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150818006404/en/
Analog Devices, Inc.Mr. Ali Husain, 781-461-3282 (phone)Director
of Investor Relations781-461-3491
(fax)investor.relations@analog.com
Analog Devices (NASDAQ:ADI)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Analog Devices (NASDAQ:ADI)
Historical Stock Chart
Von Jul 2023 bis Jul 2024