Analog Devices Guides Q2 Revenue $3.5B After Q1 Revenue Up 30.6%
Analog Devices reported fiscal Q1 revenue of $3.16 billion, up 30.6% YOY led by 38% industrial and 63% communications growth, expanding adjusted gross and operating margins by 240 bps and 500 bps, driving 52% adjusted earnings growth and $4.5 billion free cash flow. It guided Q2 revenue of $3.5 billion, 11% sequential growth.
1. Q1 Financial Performance
Analog Devices reported fiscal Q1 net revenue of $3.16 billion, a 30.6% year-over-year increase that outpaced consensus by 130 basis points. Industrial and communications segments led with 38% and 63% growth respectively, while adjusted gross margin expanded by 240 basis points and operating margin by 500 basis points, driving adjusted earnings up 52%.
2. Strong Q2 Outlook
The company guided Q2 revenue of $3.5 billion, implying 11% sequential growth versus a typical 4–5% seasonal increase, reflecting robust AI-driven datacenter demand and higher power management needs. Management expects the industrial segment to deliver roughly 20% sequential growth, with automotive flat to modestly down as previous tariff-related pull-ins unwind.
3. Capital Returns and Market Sentiment
Free cash flow topped $4.5 billion, supporting the 22nd consecutive annual dividend increase and a 1.4% year-over-year reduction in share count through buybacks. Analysts have lifted price targets up to $400, projecting over 18% upside, while institutional ownership remains elevated at 87% and short interest sits below 2%.