Analog Devices Earnings, Revenue Beat Expectations in Q3 by Investing.com

Analog devices (NASDAQ: ) shares rose about 5.6% in premarket trading Wednesday after reporting better-than-expected earnings and revenue in the third quarter, along with an upbeat outlook for the fourth quarter.

The semiconductor company reported adjusted earnings per share of $1.58 for the quarter ended Aug. 3, beating analysts’ estimates of $1.51. Revenue was $2.31 billion, beating the consensus forecast of $2.27 billion, but down 25% from last year.

Despite the decline in revenue since the start of last year, Analog Devices CEO and Chairman Vincent Roche expressed confidence in the company’s positioning amid a nascent business cycle recovery.

“Our portfolio of high-performance analog solutions positions us well to intersect the strong underlying flow of competing secular trends,” said Roche.

For the fourth quarter, Analog Devices estimates revenue between $2.3 billion and $2.5 billion, with a midpoint of $2.4 billion slightly above analysts’ expectations of $2.37 billion . The company projects adjusted EPS in the range of $1.53 to $1.73, compared to the consensus estimate of $1.62.

CFO Richard Puccio noted improved customer inventory levels and order momentum in most markets, signaling sequential growth in the fourth quarter.

However, he warned that “economic and geopolitical uncertainty continue to limit the pace of the recovery.”

The company’s gross margin percentage for Q3 was 56.7%, down from 63.8% in the same quarter last year. Analog Devices returned $574 million to shareholders through dividends and share repurchases during the quarter.