Analog Devices reported a record $3.62 billion in Q2 revenue, driven by a 90% year-over-year jump in its data center communications segment. The company expects single-digit sequential consumer revenue decline and a 50 basis-point gross-margin headwind in Q3 while integrating its Empower Semiconductor acquisition to bolster AI accelerator power solutions.
In Q2 2026, Analog Devices posted record revenue of $3.62 billion, surpassing the high end of its guidance. The data center communications division grew 90% year-over-year, driven by strong demand in both power and optical portfolios.
The company projects a single-digit sequential decline in consumer revenue due to inflationary pressures and sentiment, while anticipating a 50-basis-point gross-margin decline from the absence of a one-time channel repricing benefit. Supply-chain constraints in memory remain a potential risk for consumer customers.
The planned acquisition of Empower Semiconductor is designed to fill gaps in ADI’s power management offerings and expand its total addressable market in AI accelerators. Near-term revenue contribution is expected to be minimal, but it bolsters long-term power density and delivery capabilities.
