Analog Devices Reports Record Third Quarter Fiscal 2022 Results

Rhea-AI Summary

Analog Devices, Inc. (ADI) reported a record revenue of $3.1 billion for Q3 2022, demonstrating 77% year-over-year growth. The company achieved an operating income of $893 million and increased earnings per share to $1.44, a 7% increase from the previous year. ADI returned $1.3 billion to shareholders through dividends and share repurchases. For Q4 2022, ADI forecasts revenue of $3.15 billion with an expected operating margin of 33.7%. Despite economic uncertainty impacting bookings, demand remains strong, sustaining a robust backlog.

Positive

• Record revenue of $3.1 billion, up 77% year-over-year.
• Increased earnings per share (EPS) to $1.44, a 7% increase compared to last year.
• Record operating cash flow of $4.3 billion, providing strong liquidity.
• Total cash returned to shareholders reached $1.3 billion.

Negative

• Gross margin percentage decreased from 69.4% to 65.7%, a decline of 370 bps.
• Operating margin decreased from 34.7% to 28.7%, a decline of 600 bps.
• Economic uncertainty beginning to impact bookings, despite ongoing demand.

• Revenue of $3.1 billion with double digit year-over-year growth across all end markets
• Record Industrial, Automotive and Communications revenue
• Increased share repurchases to $906 million and paid $394 million in dividends, returning a total of $1.3 billion to shareholders during the third quarter
• Record operating cash flow of $4.3 billion and free cash flow of $3.7 billion, or 34% of revenue, on a trailing twelve-month basis

WILMINGTON, Mass.--(BUSINESS WIRE)-- Analog Devices, Inc. (Nasdaq: ADI), a leading global high-performance analog technology company, today announced financial results for its third quarter of fiscal 2022, which ended July 30, 2022.

“ADI delivered its sixth consecutive quarter of record revenue, fueling adjusted earnings per share to a new all-time high. These results reflect the agility of our hybrid manufacturing model as well as the essential role our high-performance analog, mixed signal, and power portfolio plays across numerous secular growth trends,” said Vincent Roche, CEO and Chair. “While economic uncertainty is beginning to impact bookings, demand continues to outpace supply, resulting in higher backlog, paving the way for a strong finish to a banner year.”

Roche continued, “ADI’s solutions are enabling the rise of the intelligent edge, which is proliferating at the intersection between the physical and digital worlds. With customers increasingly focused on digitalization, appreciation for ADI’s cutting-edge technology is accelerating. This undeniable trend, along with our relentless focus on innovation, gives me great confidence in our ability to drive long-term growth while making a positive societal impact.”

Performance for the Third Quarter of Fiscal 2022

Results Summary(1)
(in millions, except per-share amounts and percentages)
	Three Months Ended
	Jul. 30, 2022				Jul. 31, 2021				Change
Revenue	$	3,110			$	1,759				77	%
Gross margin	$	2,043				1,221				67	%
Gross margin percentage		65.7	%			69.4	%		(370 bps)
Operating income	$	893			$	610				47	%
Operating margin		28.7	%			34.7	%		(600 bps)
Diluted earnings per share	$	1.44			$	1.35				7	%
Adjusted Results
Adjusted gross margin	$	2,304			$	1,259				83	%
Adjusted gross margin percentage		74.1	%			71.6	%		250 bps
Adjusted operating income	$	1,557			$	766				103	%
Adjusted operating margin		50.1	%			43.6	%		650 bps
Adjusted diluted earnings per share	$	2.52			$	1.72				47	%
					Three Months Ended				Trailing Twelve Months
Cash Generation					Jul. 30, 2022				Jul. 30, 2022
Net cash provided by operating activities					$	1,248			$	4,267
% of revenue						40	%			38	%
Capital expenditures					$	(165	)		$	(526	)
Free cash flow					$	1,083			$	3,741
% of revenue						35	%			34	%
					Three Months Ended				Trailing Twelve Months
Cash Return					Jul. 30, 2022				Jul. 30, 2022
Dividend paid					$	(394	)		$	(1,525	)
Stock repurchases						(906	)			(4,355	)
Total cash returned					$	(1,300	)		$	(5,880	)
(1) The sum and/or computation of the individual amounts may not equal the total due to rounding.

Outlook for the Fourth Quarter of Fiscal Year 2022

For the fourth quarter of fiscal 2022, we are forecasting revenue of $3.15 billion, +/- $100 million. At the midpoint of this revenue outlook, we expect reported operating margin of approximately 33.7%, +/-130 bps, and adjusted operating margin of approximately 50.3%, +/-70 bps. We are planning for reported EPS to be $1.69, +/-$0.10, and adjusted EPS to be $2.57, +/-$0.10.

Our fourth quarter fiscal 2022 outlook is based on current expectations 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.

The adjusted results and adjusted anticipated results above are financial measures presented on a non-GAAP basis. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures are provided in the financial tables included in this press release. See also “Non-GAAP Financial Information” section for additional information.

Dividend Payment

The ADI Board of Directors has declared a quarterly cash dividend of $0.76 per outstanding share of common stock. The dividend will be paid on September 8, 2022 to all shareholders of record at the close of business on August 30, 2022.

Conference Call Scheduled for Today, Wednesday, August 17, 2022 at 10:00 am ET

ADI will host a conference call to discuss our third quarter fiscal 2022 results and short-term outlook today, beginning at 10:00 am ET. Investors may join via webcast, accessible at investor.analog.com, or by telephone as follows:

Participant Dial-In (toll free): 1-833-630-1956
International Participant Dial-In: 1-412-317-1837

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 (GAAP) and may be different from non-GAAP measures presented by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. These non-GAAP measures have material limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP and should not be considered in isolation from, or as a substitute for, the Company’s financial results presented in accordance with GAAP. The Company’s use of non-GAAP measures, and the underlying methodology when including or 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. You are cautioned not to place undue reliance on these non-GAAP measures. Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are provided in the financial tables included in this release.

Management uses non-GAAP measures internally 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 uses these non-GAAP measures as the primary performance measurement when communicating with analysts and investors regarding the Company’s earnings results and outlook and believes that the presentation of these non-GAAP measures 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. Management also believes that the non-GAAP liquidity measure free cash flow is useful both internally and to investors because it provides information about the amount of cash generated after capital expenditures that is then available to repay debt obligations, make investments and fund acquisitions, and for certain other activities.

The non-GAAP financial measures referenced by ADI in this release include: adjusted gross margin, adjusted gross margin percentage, adjusted operating expenses, adjusted operating expenses percentage, adjusted operating income, adjusted operating margin, adjusted nonoperating expense (income), adjusted income before income taxes, adjusted provision for income taxes, adjusted tax rate, adjusted diluted earnings per share (EPS), free cash flow, and free cash flow revenue percentage.

Adjusted gross margin is defined as gross margin, determined in accordance with GAAP, excluding certain acquisition related expenses¹, which are described further below. Adjusted gross margin percentage represents adjusted gross margin divided by revenue.

Adjusted operating expenses is defined as operating expenses, determined in accordance with GAAP, excluding: certain acquisition related expenses¹, acquisition related transaction costs² and special charges, net³, which are described further below. Adjusted operating expenses percentage represents adjusted operating expenses divided by revenue.

Adjusted operating income is defined as operating income, determined in accordance with GAAP, excluding: acquisition related expenses¹, acquisition related transaction costs² and special charges, net³, which are described further below. Adjusted operating margin represents adjusted operating income divided by revenue.

Adjusted nonoperating expense (income) is defined as nonoperating expense (income), determined in accordance with GAAP, excluding: certain acquisition related expenses¹, which is described further below.

Adjusted income before income taxes is defined as income before income taxes, determined in accordance with GAAP, excluding: acquisition related expenses¹, acquisition related transaction costs², and special charges, net³, which are described further below.

Adjusted provision for income taxes is defined as provision for income taxes, determined in accordance with GAAP, excluding tax related items⁴ , which are described further below. Adjusted tax rate represents adjusted provision for income taxes divided by adjusted income before income taxes.

Adjusted diluted EPS is defined as diluted EPS, determined in accordance with GAAP, excluding: acquisition related expenses¹, acquisition related transaction costs², special charges, net³, and tax related items⁴, which are described further below.

Free cash flow is defined as net cash provided by operating activities, determined in accordance with GAAP, less additions to property, plant and equipment, net. Free cash flow margin percentage represents free cash flow divided by revenue.

¹Acquisition Related Expenses: Expenses incurred as a result of current and prior period acquisitions and primarily include expenses associated with the fair value adjustments to debt, inventory, property, plant and equipment and amortization of acquisition related intangibles, which include acquired intangibles such as purchased technology and customer relationships. Expenses also include fair value adjustments associated with the replacement of share-based awards related to the Maxim Integrated Products, Inc. (Maxim) acquisition. We excluded these costs from our non-GAAP measures because they relate to specific transactions and are not reflective of our ongoing financial performance.

²Acquisition Related Transaction Costs: Costs directly related to the Maxim Integrated Products, Inc. acquisition, including legal, accounting and other professional fees as well as integration-related costs. 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.

³Special Charges, net: Expenses, net, incurred as part of the integration of the Acquisition, in connection with facility closures, consolidation of manufacturing facilities, severance, other accelerated stock-based compensation expense and other cost reduction efforts or reorganizational initiatives. We excluded these expenses from our non-GAAP measures because apart from ongoing expense savings as a result of such items, these expenses have no direct correlation to the operation of our business in the future.

⁴Tax Related Items: Income tax effect of the non-GAAP items discussed above and an income tax benefit from a discrete tax item related to the consolidation of certain subsidiaries. We excluded the income tax effect of these tax related items from our non-GAAP measures because they are not associated with the tax expense on our current operating results.

About Analog Devices

Analog Devices, Inc. (Nasdaq: ADI) operates at the center of the modern digital economy, converting real-world phenomena into actionable insight with its comprehensive suite of analog and mixed signal, power management, radio frequency (RF), and digital and sensor technologies. ADI serves 125,000 customers worldwide with more than 75,000 products in the industrial, communications, automotive, and consumer markets. ADI is headquartered in Wilmington, MA. Visit http://www.analog.com.

Forward Looking Statements

This press release contains forward-looking statements, which address a variety of subjects including, for example, our statements regarding sustained performance; increasing demand and supply; expected revenue, operating margin, earnings per share, and other financial results; expected market trends and acceleration of those trends, market share gains, long-term growth, operating leverage, production and inventory levels; expected customer demand and order rates for our products, expected product offerings and the importance of our product offerings and technologies to our customers; our social impact; and market position. Statements that are not historical facts, including statements about our beliefs, plans and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: the uncertainty as to the extent of the duration, scope and impacts of the COVID-19 pandemic; political and economic uncertainty, including 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; changes in export classifications, import and export regulations or duties and tariffs; changes in our estimates of our expected tax rates based on current tax law; adverse results in litigation matters, including the potential for litigation related to the Maxim acquisition; the risk that we will be unable to retain and hire key personnel, including as a result of labor shortages; changes in demand for semiconductors; unanticipated difficulties or expenditures relating to integrating Maxim; uncertainty as to the long-term value of our common stock; the diversion of management time on integrating Maxim's business and operations; our ability to successfully integrate acquired businesses and technologies, including Maxim; and the risk that expected benefits, synergies and growth prospects of acquisitions, including our acquisition of Maxim, may not be fully achieved in a timely manner, or at all. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the Securities and Exchange Commission (“SEC”), including the risk factors contained in our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K. Forward-looking statements represent management’s current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.

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, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
	Three Months Ended								Nine Months Ended
	Jul. 30, 2022				Jul. 31, 2021				Jul. 30, 2022				Jul. 31, 2021
Revenue	$	3,109,880			$	1,758,853			$	8,766,237			$	4,978,718
Cost of sales		1,066,738				537,669				3,376,578				1,575,526
Gross margin		2,043,142				1,221,184				5,389,659				3,403,192
Operating expenses:
Research and development		431,829				306,617				1,279,510				897,005
Selling, marketing, general and administrative		326,942				206,076				929,615				597,963
Amortization of intangibles		252,864				107,783				759,707				323,217
Special charges, net		138,201				(8,938	)			244,603				(8,189	)
Total operating expenses		1,149,836				611,538				3,213,435				1,809,996
Operating income		893,306				609,646				2,176,224				1,593,196
Nonoperating expense (income):
Interest expense		51,189				44,659				152,701			$	130,204
Interest income		(1,797	)			(300	)			(2,578	)		$	(799	)
Other, net		(4,023	)			(6,991	)			(24,636	)		$	(21,090	)
Total nonoperating expense (income)		45,369				37,368				125,487				108,315
Income before income taxes		847,937				572,278				2,050,737				1,484,881
Provision for income taxes		98,952				68,967				238,402				170,146
Net income	$	748,985			$	503,311			$	1,812,335			$	1,314,735
Shares used to compute earnings per common share - basic		517,011				368,476				521,557				368,834
Shares used to compute earnings per common share - diluted		520,550				371,849				525,652				372,457
Basic earnings per common share	$	1.45			$	1.37			$	3.47			$	3.56
Diluted earnings per common share	$	1.44			$	1.35			$	3.45			$	3.53

ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
	Jul. 30, 2022			Oct. 30, 2021
Cash & cash equivalents	$	1,524,960		$	1,977,964
Accounts receivable		1,742,646			1,459,056
Inventories		1,203,394			1,200,610
Other current assets		218,708			740,687
Total current assets		4,689,708			5,378,317
Net property, plant and equipment		2,180,048			1,979,051
Goodwill		26,920,335			26,918,470
Intangible assets, net		13,764,444			15,267,170
Deferred tax assets		2,297,122			2,267,269
Other assets		494,513			511,794
Total assets	$	50,346,170		$	52,322,071
Other current liabilities	$	2,441,201		$	2,253,649
Debt, current		—			516,663
Long-term debt		6,252,839			6,253,212
Deferred income taxes		3,764,370			3,938,830
Other non-current liabilities		1,249,169			1,367,175
Shareholders' equity		36,638,591			37,992,542
Total liabilities & equity	$	50,346,170		$	52,322,071

ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
	Three Months Ended								Nine Months Ended
	Jul. 30, 2022				Jul. 31, 2021				Jul. 30, 2022				Jul. 31, 2021
Cash flows from operating activities:
Net income	$	748,985			$	503,311			$	1,812,335			$	1,314,735
Adjustments to reconcile net income to net cash provided by operations:
Depreciation		75,619				50,162				212,635				158,937
Amortization of intangibles		503,350				145,989				1,512,250				436,734
Stock-based compensation expense		84,874				41,687				242,809				118,683
Gain on sale of property, plant, and equipment		(4,352	)			(13,557	)			(4,352	)			(13,557	)
Non-cash impairment charge		91,953				—				91,953				—
Cost of goods sold for inventory acquired		—				—				271,396				—
Deferred income taxes		(82,136	)			(24,286	)			(205,128	)			(72,578	)
Non-cash operating lease costs		9,739				8,815				(17,958	)			16,855
Other		3,164				(2,843	)			(7,061	)			(14,965	)
Changes in operating assets and liabilities		(183,350	)			(79,237	)			(582,813	)			(150,499	)
Total adjustments		498,861				126,730				1,513,731				479,610
Net cash provided by operating activities		1,247,846				630,041				3,326,066				1,794,345
Cash flows from investing activities:
Additions to property, plant and equipment		(164,884	)			(86,341	)			(394,796	)			(212,899	)
Other		30,751				38,829				43,761				29,619
Net cash used for investing activities		(134,133	)			(47,512	)			(351,035	)			(183,280	)
Cash flows from financing activities:
Payments on revolver		(400,000	)			—				(400,000	)			—
Proceeds from revolver		400,000				—				400,000				—
Early termination of debt		—				—				(519,116	)			—
Dividend payments to shareholders		(394,018	)			(254,506	)			(1,154,207	)			(738,114	)
Repurchase of common stock		(905,973	)			(163,281	)			(1,758,832	)			(509,152	)
Proceeds from employee stock plans		9,960				11,676				30,013				55,348
Other		(28,376	)			(447	)			(1,718	)			1,952
Net cash used for financing activities		(1,318,407	)			(406,558	)			(3,403,860	)			(1,189,966	)
Effect of exchange rate changes on cash		(8,080	)			(486	)			(24,175	)			3,742
Net (decrease) increase in cash and cash equivalents		(212,774	)			175,485				(453,004	)			424,841
Cash and cash equivalents at beginning of period		1,737,734				1,305,216				1,977,964				1,055,860
Cash and cash equivalents at end of period	$	1,524,960			$	1,480,701			$	1,524,960			$	1,480,701

ANALOG DEVICES, INC.
REVENUE TRENDS BY END MARKET
(Unaudited)
(In thousands)

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 and our methodology evolves and improves, 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 revenue within, each end market.

	Three Months Ended
	July 30, 2022							July 31, 2021
	Revenue			% of Revenue1		Y/Y%		Revenue			% of Revenue1
Industrial	$	1,555,070		50%		55%		$	1,006,383		57%
Automotive		659,090		21%		127%			290,182		16%
Communications		490,732		16%		69%			290,391		17%
Consumer		404,988		13%		136%			171,897		10%
Total revenue	$	3,109,880		100%		77%		$	1,758,853		100%
	Nine Months Ended
	July 30, 2022							July 31, 2021
	Revenue			% of Revenue1		Y/Y %		Revenue			% of Revenue1
Industrial	$	4,402,912		50%		55%		$	2,841,665		57%
Automotive		1,844,017		21%		132%			794,739		16%
Communications		1,376,182		16%		62%			850,153		17%
Consumer		1,143,126		13%		132%			492,161		10%
Total revenue	$	8,766,237		100%		76%		$	4,978,718		100%
1) The sum of the individual percentages may not equal the total due to rounding.

ANALOG DEVICES, INC.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(Unaudited)
(In thousands, except per share amounts)
	Three Months Ended								Nine Months Ended
	Jul. 30, 2022				Jul. 31, 2021				Jul. 30, 2022				Jul. 31, 2021
Gross margin	$	2,043,142			$	1,221,184			$	5,389,659			$	3,403,192
Gross margin percentage		65.7	%			69.4	%			61.5	%			68.4	%
Acquisition related expenses		260,628				37,945				1,049,991				123,653
Adjusted gross margin	$	2,303,770			$	1,259,129			$	6,439,650			$	3,526,845
Adjusted gross margin percentage		74.1	%			71.6	%			73.5	%			70.8	%
Operating expenses	$	1,149,836			$	611,538			$	3,213,435			$	1,809,996
Percent of revenue		37.0	%			34.8	%			36.7	%			36.4	%
Acquisition related expenses		(259,648	)			(109,434	)			(782,752	)			(329,637	)
Acquisition related transaction costs		(5,417	)			(18,326	)			(26,846	)			(56,570	)
Special charges, net		(138,201	)			8,938				(244,603	)			8,189
Adjusted operating expenses	$	746,570			$	492,716			$	2,159,234			$	1,431,978
Adjusted operating expenses percentage		24.0	%			28.0	%			24.6	%			28.8	%
Operating income	$	893,306			$	609,646			$	2,176,224			$	1,593,196
Operating margin		28.7	%			34.7	%			24.8	%			32.0	%
Acquisition related expenses		520,276				147,379				1,832,743				453,290
Acquisition related transaction costs		5,417				18,326				26,846				56,570
Special charges, net		138,201				(8,938	)			244,603				(8,189	)
Adjusted operating income	$	1,557,200			$	766,413			$	4,280,416			$	2,094,867
Adjusted operating margin		50.1	%			43.6	%			48.8	%			42.1	%
Nonoperating expense (income)		45,369				37,368				125,487				108,315
Acquisition related expenses		2,288				—				6,875				—
Adjusted nonoperating expense (income)	$	47,657			$	37,368			$	132,362			$	108,315
Income before income taxes	$	847,937			$	572,278			$	2,050,737			$	1,484,881
Acquisition related expenses		517,988				147,379				1,825,868				453,290
Acquisition related transaction costs		5,417				18,326				26,846				56,570
Special charges, net		138,201				(8,938	)			244,603				(8,189	)
Adjusted income before income taxes	$	1,509,543			$	729,045			$	4,148,054			$	1,986,552
Provision for income taxes	$	98,952			$	68,967			$	238,402			$	170,146
Effective tax rate		11.7	%			12.1	%			11.6	%			11.5	%
Tax related items		100,685				20,686				310,902				66,466
Adjusted provision for income taxes	$	199,637			$	89,653			$	549,304			$	236,612
Adjusted tax rate		13.2	%			12.3	%			13.2	%			11.9	%
Diluted EPS	$	1.44			$	1.35			$	3.45			$	3.53
Acquisition related expenses		1.00				0.40				3.49				1.22
Acquisition related transaction costs		0.01				0.05				0.05				0.15
Special charges, net		0.26				(0.02	)			0.46				(0.02	)
Tax related items		(0.19	)			(0.06	)			(0.59	)			(0.18	)
Adjusted diluted EPS*	$	2.52			$	1.72			$	6.85			$	4.70

* The sum of the individual per share amounts may not equal the total due to rounding.

ANALOG DEVICES, INC.
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
(Unaudited)
(In thousands)
	Trailing Twelve Months				Three Months Ended
	Jul. 30, 2022				Jul. 30, 2022				Apr. 30, 2022				Jan. 29, 2022				Oct. 30, 2021
Revenue	$	11,105,805			$	3,109,880			$	2,972,064			$	2,684,293			$	2,339,568
Net cash provided by operating activities	$	4,266,791			$	1,247,846			$	1,221,806			$	856,413			$	940,726
% of Revenue		38	%			40	%			41	%			32	%			40	%
Capital expenditures	$	(525,573	)		$	(164,884	)		$	(118,779	)		$	(111,133	)		$	(130,777	)
Free cash flow	$	3,741,218			$	1,082,962			$	1,103,027			$	745,280			$	809,949
% of Revenue		34	%			35	%			37	%			28	%			35	%

ANALOG DEVICES, INC.
RECONCILIATION OF PROJECTED GAAP TO NON-GAAP RESULTS
(Unaudited)
	Three Months Ending October 29, 2022
	Reported		Adjusted
Revenue	$3.15 Billion		$3.15 Billion
	(+/- $100 Million)		(+/- $100 Million)
Operating margin	33.7%		50.3% (1)
	(+/-130 bps)		(+/-70 bps)
Nonoperating expense	~ $50 Million		~ $50 Million
Tax rate	13%-14%		13%-14% (2)
Earnings per share	$1.69		$2.57 (3)
	(+/- $.10)		(+/- $.10)

(1) Includes $518 million of adjustments related to acquisition related expenses and $5 million of adjustments related to acquisition related transaction costs as previously defined in the Non-GAAP Financial Information section of this press release.
(2) Includes $71 million of tax effects associated with the adjustments for acquisition related expenses and acquisition related transaction costs noted above.
(3) Includes $0.88 of adjustments related to the net impact of acquisition related expenses and acquisition related transaction costs, as well as the tax effects on those items.

(ADI-WEB)

View source version on businesswire.com: https://www.businesswire.com/news/home/20220817005180/en/

For more information:

Investor Contact:

Analog Devices, Inc.

Mr. Michael Lucarelli

Vice President of Investor Relations and FP&A

781-461-3282

investor.relations@analog.com

Media Contact:

Analog Devices, Inc.

Mr. Michael Schneider

Chief Communications Officer

973-868-1000

corpcomm@analog.com

Source: Analog Devices, Inc.

FAQ

What were Analog Devices' financial results for Q3 2022?

Analog Devices reported a record revenue of $3.1 billion with a 77% year-over-year growth.

What was the earnings per share for ADI in Q3 2022?

The diluted earnings per share for ADI in Q3 2022 was $1.44, a 7% increase from the previous year.

What is ADI's revenue outlook for Q4 2022?

ADI forecasts revenue of $3.15 billion for Q4 2022, with a margin of +/- $100 million.

How much cash did Analog Devices return to shareholders in Q3 2022?

ADI returned a total of $1.3 billion to shareholders through dividends and share repurchases.

What are the projected operating margins for Q4 2022 for ADI?

The projected operating margin for Q4 2022 is approximately 33.7%, +/-130 bps.