Analog Devices 2025 Q4 Earnings Strong Performance with 64.8% Net Income Growth

Analog Devices (ADI) reported Q4 2025 earnings that exceeded expectations, with revenue rising 25.9% to $3.08 billion and EPS climbing 67.0% to $1.61. The company raised guidance for Q1 2026, forecasting $3.1 billion in revenue and $2.29 EPS, reflecting confidence in sustained demand across key sectors.

Revenue

Analog Devices’ total revenue surged to $3.08 billion in Q4 2025, a 25.9% increase from $2.44 billion in Q4 2024. The industrial segment led the way, contributing $1.43 billion in revenue—a 34% year-over-year jump driven by factory automation and defense spending. Communications revenue also stood out, reaching $389.8 million, surpassing forecasts. These segments collectively underscored the company’s ability to capitalize on infrastructure and technological advancements.

Earnings/Net Income

Net income soared 64.8% to $787.74 million in Q4 2025, up from $478.07 million in Q4 2024. The EPS increase of 67.0% to $1.61 highlights Analog Devices’ strong operational leverage and profitability, reinforcing its position as a leader in analog and mixed-signal technologies.

Post-Earnings Price Action Review

The strategy of buying Analog Devices shares after a revenue drop quarter-over-quarter on the financial report release date and holding for 30 days delivered moderate returns but underperformed the market. The strategy’s CAGR was 11.19%, trailing the benchmark by 28.88 percentage points. With a maximum drawdown of 0.00% and a Sharpe ratio of 0.36, the strategy had minimal risk but offered conservative returns, making it suitable for investors seeking stability in volatile markets.

CEO Commentary

Vincent Roche, CEO of Analog Devices, emphasized the company’s robust performance in Q4 2025, attributing the growth to strategic investments in R&D, AI, and digital capabilities. He highlighted the acquisition of Maxim as a catalyst for expansion into high-growth markets. Roche expressed confidence in the company’s long-term resilience, citing strong demand in industrial and communications sectors.

Guidance

Analog Devices projected Q1 2026 revenue of $3.1 billion and operating margin of 43.5%, with EPS expected at $2.29. The guidance reflects optimism about the cyclical recovery and the company’s ability to maintain momentum in 2026.

Additional News

Analog Devices maintained its quarterly dividend of $0.99 per share, consistent with the previous four quarters, offering a forward yield of 1.65%. The company also announced a strategic collaboration with ASE Technology to streamline manufacturing operations, enhancing efficiency. In a separate development, Evercore ISI lowered its price target for ADI to $282 from $303 while maintaining an Outperform rating, citing strong secular exposure and a recovery in industrial demand.