Analog Devices Reports Second Quarter 2016 Results

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, 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, Second Quarter, Fiscal 2016

 

Schedule A

Revenue and Earnings Summary (Unaudited)

(In thousands, except per-share amounts)

 
Three Months Ended
2Q 16       1Q 16       2Q 15
      April 30,
2016
      Jan. 30,
2016
      May 2,
2015
Revenue $ 778,766 $ 769,429 $ 821,019
Year-to-year change (5 )% % 18 %
Quarter-to-quarter change 1 % (21 )% 6 %
Cost of sales (1)     267,863         292,136         276,197  
Gross margin 510,903 477,293 544,822
Gross margin percentage 65.6 % 62.0 % 66.4 %
Year-to-year change (basis points) (80 ) (320 ) 30
Quarter-to-quarter change (basis points)     360         (360 )       120  
Operating expenses:
R&D (1) 160,235 157,428 154,233
Selling, marketing and G&A (1) 112,186 107,462 117,371
Amortization of intangibles 17,419 17,358 24,210
Special charges     13,684                  
Total operating expenses 303,524 282,248 295,814
Total operating expenses percentage 39.0 % 36.7 % 36.0 %
Year-to-year change (basis points) 300 (160 ) 170
Quarter-to-quarter change (basis points)     230         (1,780 )       (230 )
Operating income 207,379 195,045 249,008
Operating income percentage 26.6 % 25.3 % 30.3 %
Year-to-year change (basis points) (370 ) (160 ) (140 )
Quarter-to-quarter change (basis points)     130         1,420         340  
Other expense     12,469         12,868         3,819  
Income before income tax 194,910 182,177 245,189
Provision for income taxes 24,337 17,673 39,851
Tax rate percentage     12.5 %       9.7 %       16.3 %
Net income     $ 170,573         $ 164,504         $ 205,338  
 
Shares used for EPS - basic 308,790 311,166 312,660
Shares used for EPS - diluted 312,250 314,793 317,047
 
Earnings per share - basic $ 0.55 $ 0.53 $ 0.66
Earnings per share - diluted $ 0.55 $ 0.52 $ 0.65
 
Dividends paid per share     $ 0.42         $ 0.40         $ 0.40  
 
(1) Includes stock-based compensation expense as follows:
Cost of sales $ 1,986 $ 2,092 $ 2,207
R&D $ 6,646 $ 6,704 $ 6,416
Selling, marketing and G&A $ 7,327 $ 6,813 $ 7,478
 

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