Semiconductor giant Analog Devices Inc. (NYSE:ADI) posted better-than-expected third-quarter profit, as sales jumped 46%, and the company “fundamentally improved cost structure,” president and CEO Jerald G. Fishman said in a release.
"ADI had a strong third quarter, delivering sequential sales growth of 8% with the largest increases occurring in the industrial and communications infrastructure markets," Fishman said, in his statement.
The chip-maker's results prompted a strong fourth-quarter forecast, with the company expecting earnings per share in the range of 68 to 72 cents on revenue between $740 million and $770 million. The view was well above expectations, as the Street had predicted earnings of 61 cents a share on revenue of $715.5 million.
In the third quarter, the company reported profit of $199.5 million, or 65 cents a share, compared with earnings of $65.5 million, or 22 cents a share, in the third quarter of last year.
Revenue rose 46% to $720 million, up from year-ago sales of $492 million. Sales in the company’s industrial segment jumped 69%, year-over-year, while its automotive unit reported a sales increase of 62%, over the past year. Sales in ADI’s consumer division experienced the smallest increase, with revenue rising just 23%, year-over-year.
Analysts polled by Thomson Reuters had predicted earnings of 60 cents a share on revenue of $706.5 million.
Gross margin widened to 66.7%, up from 54.1%, one year ago. The company forecast fourth-quarter gross margin in the range of 66% to 67%.
Shares of Analog Devices rose 1.59% on Monday, closing at $28.81. The stock was up another 19 cents in after-hours trading. The stock is up 7.66% over the past year.