Analog Devices 2025 Q4 Earnings Beats Expectations as Net Income Surges 64.8%

Analog Devices (ADI) reported fiscal 2025 Q4 earnings on Nov 25, 2025, delivering results that exceeded expectations. Revenue rose 25.9% year-over-year to $3.08 billion, while EPS surged 66.2% to $1.60. The company also raised Q1 2026 guidance, signaling confidence in sustained demand across industrial, aerospace/defense, and data center markets.

Revenue

Analog Devices’ total revenue reached $3.08 billion in 2025 Q4, a 25.9% increase from $2.44 billion in 2024 Q4. This growth was driven by robust demand across all end markets, with Communications and Industrial segments leading the charge. The company’s ability to capitalize on AI, automation, and energy efficiency trends underscored its market leadership.

Earnings/Net Income

The company’s EPS climbed 66.2% to $1.60 in 2025 Q4, while net income grew 64.8% to $787.74 million. These figures highlight Analog Devices’ strong operational resilience, with profitability sustained for over 20 years in the same fiscal quarter. The substantial increase in EPS and net income underscores Analog Devices’ strong operational performance and profitability.

Price Action

ADI’s stock price surged 9.29% in a single trading day, 9.51% over the past week, and 5.89% month-to-date, reflecting investor optimism about its earnings and guidance.

Post-Earnings Price Action Review

The strategy of buying Analog Devices shares after a quarterly revenue drop on the earnings release date and selling 30 days later resulted in poor performance. With a CAGR of -0.43% and an excess return of -61.99%, it underperformed the benchmark return of 60.81%. Despite a maximum drawdown of 0.00%, the strategy’s Sharpe ratio of -0.02 indicated unfavorable risk-adjusted returns.

CEO Commentary

CEO Vincent Roche emphasized revenue and EPS exceeding guidance midpoints, driven by Maxim revenue synergies and growth in industrial, aerospace/defense, and data center markets. He highlighted R&D investments in analog, mixed-signal, and AI capabilities, along with record free cash flow ($4 billion) and shareholder returns ($4 billion via dividends/share repurchases).

Guidance

CFO Richard Puccio provided Q1 2026 guidance: revenue of $3.1 billion ±$100 million, EPS of $2.29 ±$0.10, and an operating margin of 43.5% ±100 bps. Free cash flow is targeted at 39% of revenue, with 100% of long-term returns directed to shareholders.

Additional News

Analog Devices returned 96% of its $4.3 billion free cash flow to shareholders in fiscal 2025, including $2.2 billion in share repurchases and $1.9 billion in dividends. The company also declared a $0.99 per share dividend, payable on Dec 22, 2025. Additionally, it highlighted strategic priorities such as expanding software/digital/AI capabilities and leveraging design pipelines driven by AI and automation trends.