01—Abstract
Summary
Summary of the 10-K filed November 24, 2015. Cited figures are marked; the original filing is the authoritative source.
Analog Devices, Inc. (ADI) reported a strong fiscal year 2015, with total revenue increasing by 20% to $3.435 billiona, largely driven by the acquisition of Hittite Microwave Corporation.
Net income also saw a healthy increase of 11% to $696.8 millionb, resulting in diluted earnings per share of $2.20. The company's core markets, particularly industrial and consumer, showed robust performance, with industrial representing 44% of revenue and consumer showing significant growth. ADI continues to invest heavily in research and development, spending $637 million in fiscal 2015 to maintain its technological leadership in analog, mixed-signal, and digital signal processing technologies.
Financially, ADI ended the fiscal year with substantial liquidity, holding $3.0 billionc in cash and cash equivalents and short-term investments. The company also demonstrated a commitment to returning value to shareholders through dividends and share repurchases. While the company faces competition and cyclicality inherent in the semiconductor industry, its diversified end markets and continued focus on innovation position it well for future growth.
02—Key points
Key Highlights
- Revenue grew 20% to $3.435 billion in fiscal year 2015, primarily due to the acquisition of Hittite Microwave Corporation.
- Net income increased by 11% to $696.8 million, leading to diluted EPS of $2.20.
- The Industrial segment was the largest revenue contributor at 44% ($1.496 billion), followed by Consumer (21%, $730 million) and Communications (20%, $683 million).
- Research and Development (R&D) spending increased by 14% to $637.5 million, underscoring the company's commitment to innovation.
- The company ended fiscal year 2015 with strong liquidity, holding $3.0 billion in cash and cash equivalents and short-term investments.
- ADI returned capital to shareholders through $491 million in dividend payments and $227 million in share repurchases.
- The company's largest customer represented 13% of fiscal 2015 revenue, indicating some customer concentration but not excessive.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2015, Analog Devices kept $0.20.
- Revenue$3.44B100.0%
- Cost of revenue−$1.18B34.2%
- Gross profit$2.26B65.8%
- Operating costs−$1.43B41.6%
- Operating income$830.8M24.2%
- Interest, other & tax−$134.0M3.9%
- Net income$696.9M20.3%
Where FY2015 revenue went
$3.44B- Cost of revenue: $1.18B, 34% of revenue
- Net income: $696.9M, 20% of revenue
- R&D: $637.5M, 19% of revenue
- SG&A: $479.0M, 14% of revenue
- Other operating costs: $312.0M, 9.1% of revenue
- Interest, other & tax: $134.0M, 3.9% of revenue
Kept 20% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2015filed November 24, 2015Financial Statements
FY2015 against FY2014
| Line item | FY2015FY2014 | Change |
|---|---|---|
| Revenue | $3.44B$2.86B | +19.9% |
| Cost of Revenue | $1.18B$1.03B | +13.7% |
| Gross Profit | $2.26B$1.83B | +23.4% |
| R&D Expenses | $637.46M$559.69M | +13.9% |
| SG&A Expenses | $478.97M$454.68M | +5.3% |
| Operating Expenses | $1.43B$1.08B | +32.5% |
| Operating Income | $830.84M$752.48M | +10.4% |
| Interest Expense | $27.03M$34.78M | −22.3% |
| Net Income | $696.88M$629.32M | +10.7% |
| EPS (Basic) | $2.23$2.01 | +10.9% |
| EPS (Diluted) | $2.20$1.98 | +11.1% |
| Shares Outstanding (Basic) | 312.66M313.19M | −0.2% |
| Shares Outstanding (Diluted) | 316.87M318.03M | −0.4% |
05—Questions
Frequently Asked Questions
What was the primary driver of revenue growth in fiscal year 2015?
The primary driver of the 20% revenue growth to $3.435 billion in fiscal year 2015 was the acquisition of Hittite Microwave Corporation, which expanded ADI's portfolio and market reach.
How diversified are ADI's end markets?
ADI serves diverse end markets, with the Industrial segment being the largest at 44% of revenue. Other significant segments include Consumer (21%), Communications (20%), and Automotive (15%), indicating a well-diversified revenue base.
What is ADI's financial health and liquidity position?
Analog Devices demonstrated strong financial health, ending fiscal year 2015 with $3.0 billion in cash and cash equivalents and short-term investments. This robust liquidity supports ongoing operations, R&D, and capital returns to shareholders.
How is ADI investing in its future growth?
ADI is heavily investing in its future by increasing R&D spending by 14% to $637.5 million in fiscal year 2015. This investment is focused on maintaining technological leadership and developing innovative products in analog, mixed-signal, and digital signal processing.
06—Continue