• Revenue of $1.53 billion for the fourth quarter and $5.60 billion for fiscal 2020
  • B2B revenue for the fourth quarter increased 4% sequentially and 10% year-over-year
  • Operating cash flow of $2.0 billion and free cash flow of $1.8 billion for fiscal 2020
  • Returned over $1.1 billion to shareholders in fiscal 2020 and recently reinstated our buyback program

Analog Devices, Inc. (Nasdaq: ADI), a leading global high-performance semiconductor company, today announced financial results for its fourth quarter and full year fiscal 2020, which ended October 31, 2020.

“ADI delivered fourth quarter results above the high-end of our outlook. We grew revenue across all of our B2B markets, expanded operating margins and increased EPS by double-digits year-over-year,” said Vincent Roche, President and CEO of Analog Devices. “Fiscal 2020 represented a year of strategic progress against an unprecedented backdrop, and our results continue to highlight the insatiable demand for our high-performance analog and mixed signal solutions. Overall, I’m proud of how our global team embraced and learned from this challenging time and continued to execute at a high level to generate and capture value for all stakeholders.”

Roche continued, “Looking ahead, our pending acquisition of Maxim Integrated is an opportunity to increase our scale and scope to deliver disruptive innovation for our customers while driving further profitable growth. The combination strengthens our industry leadership position, further diversifying our business across markets and applications and solidifying ADI as the destination for the world’s best analog talent. While the macroenvironment remains fluid, we are cautiously optimistic that a broad-based recovery is underway and expect to build on this momentum in fiscal 2021.”

Performance for the Fourth Quarter of Fiscal 2020

Results Summary(1)

 

 

 

 

 

(in millions, except per-share amounts and percentages)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Oct 31, 2020

 

Nov 2, 2019

 

Change

Revenue

$

1,526

 

 

$

1,443

 

 

6

%

Gross margin

$

1,023

 

 

$

942

 

 

9

%

Gross margin percentage

67.0

%

 

65.3

%

(2)

 

170 bps

Operating income

$

462

 

 

$

338

 

 

36

%

Operating margin

30.2

%

 

23.4

%

 

680 bps

Diluted earnings per share

$

1.04

 

 

$

0.74

 

 

41

%

 

 

 

 

 

 

Adjusted Results

 

 

 

 

 

Adjusted gross margin

$

1,068

 

 

$

987

 

 

8

%

Adjusted gross margin percentage

70.0

%

 

68.4

%

(2)

 

160 bps

Adjusted operating income

$

636

 

 

$

560

 

 

14

%

Adjusted operating margin

41.7

%

 

38.8

%

 

290 bps

Adjusted diluted earnings per share

$

1.44

 

 

$

1.19

 

 

21

%

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Trailing Twelve Months

Cash Generation

 

 

Oct 31, 2020

 

Oct 31, 2020

Net cash provided by operating activities

 

 

$

673

 

 

$

2,008

 

% of revenue

 

 

44.1

%

 

35.8

%

Capital expenditures

 

 

$

(30)

 

 

$

(166)

 

Free cash flow

 

 

$

643

 

 

$

1,843

 

% of revenue

 

 

42.1

%

 

32.9

%

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Trailing Twelve Months

Cash Return

 

 

Oct 31, 2020

 

Oct 31, 2020

Dividend paid

 

 

$

(230)

 

 

$

(886)

 

Stock repurchases

 

 

(7)

 

 

(244)

 

Total cash returned

 

 

$

(237)

 

 

$

(1,131)

 

(1) The sum and/or computation of the individual amounts may not equal the total due to rounding.

(2) Includes approximately 140 basis points of impact from a write-down of inventory associated with a customer within our Communications end market.

Outlook for the First Quarter of Fiscal Year 2021

For the first quarter of fiscal 2021, we are forecasting revenue of $1.50 billion, +/- $70 million. At the midpoint of this revenue outlook, we expect reported operating margin of approximately 29.1%, +/- 150 bps, and adjusted operating margin of approximately 40.0%, +/- 100 bps. We are planning for reported EPS to be $0.92, +/- $0.10, and adjusted EPS to be $1.30, +/- $0.10.

Our first quarter fiscal 2021 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 $0.62 per outstanding share of common stock. The dividend will be paid on December 15, 2020 to all shareholders of record at the close of business on December 4, 2020.

Conference Call Scheduled for Today, Tuesday, November 24, 2020 at 10:00 am ET

ADI will host a conference call to discuss our fourth quarter fiscal 2020 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 (call 800-859-9560, or 706-634-7193 for international calls, ten minutes before the call begins and provide the password "ADI").

A replay will be available two hours after the completion of the call. The replay may be accessed for up to two weeks by dialing 855-859-2056 (replay only) and providing the conference ID: 5297321, or by visiting investor.analog.com.

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 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 margin 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; restructuring related expense3; and charitable foundation contribution4 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; restructuring related expense3; and charitable foundation contribution4 which are described further below. Adjusted operating margin represents adjusted operating income divided by revenue.

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; restructuring related expense3; and charitable foundation contribution4 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 items5 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; restructuring related expense3; charitable foundation contribution4; and tax related items5 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 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 severance payments, equity award accelerations, and the fair value adjustment associated with the replacement of share-based awards related to the Linear Technology Corporation (Linear) 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 proposed 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.

3Restructuring Related Expense: Expenses incurred 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.

4Charitable Foundation Contribution: Expenses incurred in connection with a one time contribution of registered shares of common stock to the Analog Devices Foundation. We excluded this expense from our non-GAAP measures because this expense has no direct correlation to the operation of our business in the future.

5Tax Related Items: Income tax effect of the non-GAAP items discussed above and income tax from certain discrete tax items primarily related to the resolution of prior period tax audits, income tax from certain uncertain tax positions, income tax from state valuation allowance adjustments, income tax on certain inventory intra-entity transfers, the impact of a voluntary accounting policy change and other income tax adjustments related to prior periods. We excluded the income tax benefit / provision effect of these tax related items from our non-GAAP measures because they are not associated with the tax expense on our ongoing operating results.

About Analog Devices

Analog Devices (Nasdaq: ADI) is a leading global high-performance analog technology company dedicated to solving the toughest engineering challenges. We enable our customers to interpret the world around us by intelligently bridging the physical and digital with unmatched technologies that sense, measure, power, connect and interpret. 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 our proposed acquisition of Maxim Integrated Products, Inc. (“Maxim”); the impact of the COVID-19 pandemic on our business, financial condition and results of operations; expected revenue, operating margin, tax rate, earnings per share, and other financial results; expected market trends, market share gains, operating leverage, production and inventory levels; expected customer demand and order rates for our products and expected product offerings; product development; and marketing 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 or Maxim’s estimates of our respective expected tax rates based on current tax law; our ability to successfully integrate Maxim’s businesses and technologies; the risk that the expected benefits and synergies of the proposed transaction and growth prospects of the combined company may not be fully achieved in a timely manner, or at all; adverse results in litigation matters, including the potential for litigation related to the proposed transaction; the risk that we or Maxim will be unable to retain and hire key personnel; the risk associated with the timing of the closing of the proposed transaction, including the risk that the conditions to the transaction are not satisfied on a timely basis or at all or the failure of the transaction to close for any other reason or to close on the anticipated terms, including the anticipated tax treatment; the risk that any regulatory approval, consent or authorization that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; unanticipated difficulties or expenditures relating to the transaction, the response of business partners and retention as a result of the announcement and pendency of the transaction; uncertainty as to the long-term value of our common stock; the diversion of management time on transaction-related matters; our ability to successfully integrate acquired businesses and technologies; and the risk that expected benefits, synergies and growth prospects of acquisitions 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

 

Twelve Months Ended

 

Oct 31, 2020

 

Nov 2, 2019

 

Oct 31, 2020

 

Nov 2, 2019

Revenue

$

1,526,295

 

 

$

1,443,219

 

 

$

5,603,056

 

 

$

5,991,065

 

Cost of sales

503,211

 

 

501,028

 

 

1,912,578

 

 

1,977,315

 

Gross margin

1,023,084

 

 

942,191

 

 

3,690,478

 

 

4,013,750

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

280,239

 

 

277,018

 

 

1,050,519

 

 

1,130,348

 

Selling, marketing, general and administrative

165,115

 

 

154,799

 

 

659,923

 

 

648,094

 

Amortization of intangibles

108,007

 

 

107,225

 

 

429,455

 

 

429,041

 

Special charges

8,051

 

 

64,788

 

 

52,337

 

 

95,659

 

Total operating expenses

561,412

 

 

603,830

 

 

2,192,234

 

 

2,303,142

 

Operating income

461,672

 

 

338,361

 

 

1,498,244

 

 

1,710,608

 

Nonoperating expense (income):

 

 

 

 

 

 

 

Interest expense

48,593

 

 

50,775

 

 

193,305

 

 

229,075

 

Interest income

(527)

 

 

(1,988)

 

 

(4,305)

 

 

(10,229)

 

Other, net

(3,704)

 

 

1,747

 

 

(2,373)

 

 

6,034

 

 

44,362

 

 

50,534

 

 

186,627

 

 

224,880

 

Income before income taxes

417,310

 

 

287,827

 

 

1,311,617

 

 

1,485,728

 

Provision for income taxes

30,784

 

 

10,133

 

 

90,856

 

 

122,717

 

Net income

$

386,526

 

 

$

277,694

 

 

$

1,220,761

 

 

$

1,363,011

 

 

 

 

 

 

 

 

 

Shares used to compute earnings per share - basic

369,284

 

 

369,051

 

 

368,633

 

 

369,133

 

Shares used to compute earnings per share - diluted

372,322

 

 

372,584

 

 

371,973

 

 

372,871

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

1.05

 

 

$

0.75

 

 

$

3.31

 

 

$

3.68

 

Diluted earnings per common share

$

1.04

 

 

$

0.74

 

 

$

3.28

 

 

$

3.65

 

ANALOG DEVICES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

 

 

October 31, 2020

 

November 2, 2019

Cash & cash equivalents

$

1,055,860

 

 

$

648,322

 

Accounts receivable

737,536

 

 

635,136

 

Inventories

608,260

 

 

609,886

 

Other current assets

116,032

 

 

91,782

 

Total current assets

2,517,688

 

 

1,985,126

 

Net property, plant and equipment

1,120,561

 

 

1,219,989

 

Other investments

86,729

 

 

77,324

 

Goodwill

12,278,425

 

 

12,256,880

 

Intangible assets, net

3,650,280

 

 

4,217,224

 

Deferred tax assets

1,503,064

 

 

1,582,382

 

Other assets

311,856

 

 

53,716

 

Total assets

$

21,468,603

 

 

$

21,392,641

 

 

 

 

 

Other current liabilities

$

1,364,986

 

 

$

1,208,965

 

Debt, current

 

 

299,667

 

Long-term debt

5,145,102

 

 

5,192,252

 

Deferred income taxes

1,919,595

 

 

2,088,212

 

Other non-current liabilities

1,040,975

 

 

894,357

 

Shareholders' equity

11,997,945

 

 

11,709,188

 

Total liabilities & equity

$

21,468,603

 

 

$

21,392,641

 

 

 

 

 

ANALOG DEVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

Three Months Ended

 

Twelve Months Ended

 

Oct 31, 2020

 

Nov 2, 2019

 

Oct 31, 2020

 

Nov 2, 2019

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

386,526

 

 

$

277,694

 

 

$

1,220,761

 

 

$

1,363,011

 

Adjustments to reconcile net income to net cash provided by operations:

 

 

 

 

 

 

 

Depreciation

57,053

 

 

61,636

 

 

233,775

 

 

240,677

 

Amortization of intangibles

145,163

 

 

143,528

 

 

577,148

 

 

570,574

 

Stock-based compensation expense

36,557

 

 

37,580

 

 

149,518

 

 

150,300

 

Non-cash impairment included in special charges

 

 

9,800

 

 

 

 

14,167

 

Deferred income taxes

(71,146)

 

 

(35,809)

 

 

(113,948)

 

 

(91,253)

 

Non-cash contribution to charitable foundation

 

 

 

 

40,000

 

 

 

Other non-cash activity

(257)

 

 

14,206

 

 

5,418

 

 

40,907

 

Changes in operating assets and liabilities

118,702

 

 

149,270

 

 

(104,185)

 

 

(35,283)

 

Total adjustments

286,072

 

 

380,211

 

 

787,726

 

 

890,089

 

Net cash provided by operating activities

672,598

 

 

657,905

 

 

2,008,487

 

 

2,253,100

 

Percent of revenue

44.1

%

 

45.6

%

 

35.8

%

 

37.6

%

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Additions to property, plant and equipment

(29,888)

 

 

(51,076)

 

 

(165,692)

 

 

(275,372)

 

Payments for acquisitions, net of cash acquired

(1,433)

 

 

(11,170)

 

 

(14,196)

 

 

(11,170)

 

Change in other assets

579

 

 

(1,512)

 

 

(635)

 

 

(6,644)

 

Net cash used for investing activities

(30,742)

 

 

(63,758)

 

 

(180,523)

 

 

(293,186)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Proceeds from debt

 

 

 

 

395,646

 

 

1,250,000

 

Early termination of debt

 

 

 

 

 

 

(1,250,000)

 

Proceeds from revolver

 

 

 

 

350,000

 

 

75,000

 

Payments on revolver

 

 

 

 

(350,000)

 

 

(75,000)

 

Debt repayments

(450,000)

 

 

(200,000)

 

 

(750,000)

 

 

(850,000)

 

Dividend payments to shareholders

(229,597)

 

 

(200,196)

 

 

(886,155)

 

 

(777,481)

 

Repurchase of common stock

(7,222)

 

 

(172,389)

 

 

(244,487)

 

 

(613,005)

 

Proceeds from employee stock plans

10,653

 

 

10,388

 

 

68,403

 

 

116,523

 

Change in other financing activities

 

 

5,087

 

 

(4,015)

 

 

(2,831)

 

Net cash used for financing activities

(676,166)

 

 

(557,110)

 

 

(1,420,608)

 

 

(2,126,794)

 

Effect of exchange rate changes on cash

(94)

 

 

(879)

 

 

182

 

 

(1,389)

 

 

 

 

 

 

 

 

 

Net (decrease) increase in cash and cash equivalents

(34,404)

 

 

36,158

 

 

407,538

 

 

(168,269)

 

Cash and cash equivalents at beginning of period

1,090,264

 

 

612,164

 

 

648,322

 

 

816,591

 

Cash and cash equivalents at end of period

$

1,055,860

 

 

$

648,322

 

 

$

1,055,860

 

 

$

648,322

 

 

 

 

 

 

 

 

 

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 results within, each end market.

 

 

Three Months Ended

 

 

Oct 31, 2020

 

Nov 2, 2019

 

 

Revenue

 

% of revenue*

 

Y/Y %

 

Revenue

 

% of revenue*

Industrial

 

$

811,226

 

 

53%

 

9%

 

$

745,672

 

 

52%

Communications

 

312,649

 

 

20%

 

19%

 

262,808

 

 

18%

Automotive

 

229,781

 

 

15%

 

2%

 

226,057

 

 

16%

Consumer

 

172,639

 

 

11%

 

(17)%

 

208,682

 

 

14%

Total revenue

 

$

1,526,295

 

 

100%

 

6%

 

$

1,443,219

 

 

100%

 

 

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

 

 

Oct 31, 2020

 

Nov 2, 2019

 

 

Revenue

 

% of revenue*

 

Y/Y %

 

Revenue

 

% of revenue*

Industrial

 

$

2,987,542

 

 

53%

 

(1)%

 

$

3,011,411

 

 

50%

Communications

 

1,195,946

 

 

21%

 

(8)%

 

1,294,960

 

 

22%

Automotive

 

779,276

 

 

14%

 

(16)%

 

930,613

 

 

16%

Consumer

 

640,292

 

 

11%

 

(15)%

 

754,081

 

 

13%

Total revenue

 

$

5,603,056

 

 

100%

 

(6)%

 

$

5,991,065

 

 

100%

 

 

 

 

 

 

 

 

 

 

 

*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

 

Twelve Months Ended

 

Oct 31, 2020

 

Nov 2, 2019

 

Oct 31, 2020

 

Nov 2, 2019

 

 

 

 

 

 

 

 

Gross margin

$

1,023,084

 

 

$

942,191

 

 

$

3,690,478

 

 

$

4,013,750

 

Gross margin percentage

67.0

%

 

65.3

%

 

65.9

%

 

67.0

%

Acquisition related expenses

44,741

 

 

44,822

 

 

179,374

 

 

175,266

 

Adjusted gross margin

$

1,067,825

 

 

$

987,013

 

 

$

3,869,852

 

 

$

4,189,016

 

Adjusted gross margin percentage

70.0

%

 

68.4

%

 

69.1

%

 

69.9

%

 

 

 

 

 

 

 

 

Operating expenses

$

561,412

 

 

$

603,830

 

 

$

2,192,234

 

 

$

2,303,142

 

Percent of revenue

36.8

%

 

41.8

%

 

39.1

%

 

38.4

%

Acquisition related expenses

(110,963)

 

 

(112,219)

 

 

(444,261)

 

 

(451,511)

 

Acquisition related transaction costs

(10,977)

 

 

 

 

(20,098)

 

 

 

Charitable foundation contribution

 

 

 

 

(40,000)

 

 

 

Restructuring related expense

(8,050)

 

 

(64,788)

 

 

(52,337)

 

 

(95,659)

 

Adjusted operating expenses

$

431,422

 

 

$

426,823

 

 

$

1,635,538

 

 

$

1,755,972

 

Adjusted operating expenses percentage

28.3

%

 

29.6

%

 

29.2

%

 

29.3

%

 

 

 

 

 

 

 

 

Operating income

$

461,672

 

 

$

338,361

 

 

$

1,498,244

 

 

$

1,710,608

 

Operating margin

30.2

%

 

23.4

%

 

26.7

%

 

28.6

%

Acquisition related expenses

155,704

 

 

157,041

 

 

623,635

 

 

626,777

 

Acquisition related transaction costs

10,977

 

 

 

 

20,098

 

 

 

Charitable foundation contribution

 

 

 

 

40,000

 

 

 

Restructuring related expense

8,050

 

 

64,788

 

 

52,337

 

 

95,659

 

Adjusted operating income

$

636,403

 

 

$

560,190

 

 

$

2,234,314

 

 

$

2,433,044

 

Adjusted operating margin

41.7

%

 

38.8

%

 

39.9

%

 

40.6

%

 

 

 

 

 

 

 

 

Provision for income taxes

$

30,784

 

 

$

10,133

 

 

$

90,856

 

 

$

122,717

 

Income tax effect of adjustments above

26,878

 

 

35,903

 

 

106,291

 

 

104,470

 

Income tax from certain discrete tax items

 

 

20,302

 

 

25,951

 

 

61,227

 

Adjusted provision for income taxes

$

57,662

 

 

$

66,338

 

 

$

223,098

 

 

$

288,414

 

 

 

 

 

 

 

 

 

Income before income taxes

$

417,310

 

 

$

287,827

 

 

$

1,311,617

 

 

$

1,485,728

 

Effective tax rate

7.4

%

 

3.5

%

 

6.9

%

 

8.3

%

Acquisition related expenses

155,704

 

 

157,041

 

 

623,635

 

 

626,777

 

Acquisition related transaction costs

10,977

 

 

 

 

20,098

 

 

 

Charitable foundation contribution

 

 

 

 

40,000

 

 

 

Restructuring related expense

8,050

 

 

64,788

 

 

52,337

 

 

95,659

 

Adjusted income before income taxes

$

592,041

 

 

$

509,656

 

 

$

2,047,687

 

 

$

2,208,164

 

Adjusted tax rate

9.7

%

 

13.0

%

 

10.9

%

 

13.1

%

 

 

 

 

 

 

 

 

Diluted EPS

$

1.04

 

 

$

0.74

 

 

$

3.28

 

 

$

3.65

 

Acquisition related expenses

0.42

 

 

0.42

 

 

1.68

 

 

1.68

 

Acquisition related transaction costs

0.03

 

 

 

 

0.05

 

 

 

Charitable foundation contribution

 

 

 

 

0.11

 

 

 

Restructuring related expense

0.02

 

 

0.17

 

0.14

 

 

0.26

 

Income tax effect of adjustments above

(0.07)

 

 

(0.10)

 

 

(0.29)

 

 

(0.28)

 

Income tax from certain discrete tax items

 

 

(0.05)

 

 

(0.07)

 

 

(0.16)

 

Adjusted diluted EPS*

$

1.44

 

 

$

1.19

 

 

$

4.91

 

 

$

5.15

 

* 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

 

Oct 31, 2020

 

Oct 31, 2020

 

Aug 1, 2020

 

May 2, 2020

 

Feb 1, 2020

Revenue

$

5,603,056

 

 

$

1,526,295

 

 

$

1,456,136

 

 

$

1,317,060

 

 

$

1,303,565

 

Net cash provided by operating activities

$

2,008,487

 

 

$

672,598

 

 

$

557,200

 

 

$

429,041

 

 

$

349,648

 

% of Revenue

36

%

 

44

%

 

38

%

 

33

%

 

27

%

Capital expenditures

$

(165,692)

 

 

$

(29,888)

 

 

$

(20,804)

 

 

$

(60,161)

 

 

$

(54,839)

 

Free cash flow

$

1,842,795

 

 

$

642,710

 

 

$

536,396

 

 

$

368,880

 

 

$

294,809

 

% of Revenue

33

%

 

42

%

 

37

%

 

28

%

 

23

%

ANALOG DEVICES, INC.

RECONCILIATION OF PROJECTED GAAP TO NON-GAAP RESULTS

(Unaudited)

 

 

Three Months Ending January 30, 2021

 

Reported

 

Adjusted

Revenue

$1.50 Billion

 

$1.50 Billion

 

(+/- $70 Million)

 

(+/- $70 Million)

Operating margin

29.1%

 

40.0% (1)

 

(+/-150 bps)

 

(+/-100 bps)

Nonoperating expenses

~ $43 Million

 

~ $43 Million

Tax rate

12% to 14%

 

12% to 14% (2)

Earnings per share

$0.92

 

$1.30 (3)

 

(+/- $0.10)

 

(+/- $0.10)

(1) Includes $163 million of adjustments related to acquisition related expenses and acquisition related transaction costs as previously defined in the Non-GAAP Financial Information section of this press release. (2) Includes $23 million of tax effects associated with the adjustment for acquisition related expenses and acquisition related transaction costs noted above. (3) Includes $0.38 of adjustments related to the net impact of $0.44 of acquisition related expenses and acquisition related transaction costs, as well as $0.06 of tax effects on those items.

(ADI WEB)

Investor Contact: Analog Devices, Inc. Mr. Michael Lucarelli Sr. Director of Investor Relations 781-461-3282 investor.relations@analog.com Media Contacts: Teneo Ms. Andrea Calise 917-826-3804 andrea.calise@teneo.com Teneo Ms. Megan Fenton 917-860-0356 megan.fenton@teneo.com