01—Abstract
Summary
Summary of the 10-Q filed August 19, 2026. Cited figures are marked; the original filing is the authoritative source.
Analog Devices, Inc. (ADI) reported a significant increase in financial performance for the nine months ended August 1, 2026, compared to the same period in the prior year.
Revenue grew by 36% to $10.8 billiona, driven by strong demand across key end markets, particularly Industrial and Communications. Net income more than doubled to $3.35 billion, with diluted EPS rising to $6.83 from $2.97. The company's gross margin percentage also saw substantial improvement, reaching 66.6% due to higher manufacturing utilization and favorable product mix.
Operationally, ADI completed the acquisition of Empower Semiconductor, Inc. for approximately $1.5 billionb, bolstering its power management solutions. The company also announced a new $3.0 billion 364-day revolving credit facility, adding to its liquidity.
Despite these positive developments, the company faces ongoing risks, including a cybersecurity incident in June 2026, for which investigations are ongoing, and a material tax assessment from the IRS related to transfer pricing. Management believes current liquidity and cash flow from operations are sufficient to fund its operations for at least the next twelve months.
02—Key points
Key Highlights
- Revenue for the nine months ended August 1, 2026, increased by 36% year-over-year to $10.8 billion.
- Net income surged by 126% to $3.35 billion for the nine-month period.
- Diluted EPS grew significantly to $6.83 for the nine months ended August 1, 2026, up from $2.97 in the prior year.
- Gross margin percentage improved to 66.6% for the nine-month period, up from 60.8% in the prior year, driven by higher utilization and favorable product mix.
- The company acquired Empower Semiconductor, Inc. for approximately $1.5 billion to enhance its power technology portfolio.
- ADI secured a new $3.0 billion 364-day revolving credit facility, strengthening its liquidity position.
- The company experienced a cybersecurity incident in June 2026, with ongoing investigations; no material impact is currently believed to have occurred, but risks remain.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2026, Analog Devices kept $0.33.
- Revenue$4.02B100.0%
- Cost of revenue−$1.31B32.7%
- Gross profit$2.71B67.3%
- Operating costs−$1.09B27.2%
- Operating income$1.61B40.1%
- Interest, other & tax−$272.9M6.8%
- Net income$1.34B33.3%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed August 19, 2026Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $4.02B$2.88B | +39.6% |
| Cost of Revenue | $1.31B$1.09B | +20.5% |
| Gross Profit | $2.71B$1.79B | +51.3% |
| R&D Expenses | $533.48M$454.25M | +17.4% |
| SG&A Expenses | $397.33M$325.71M | +22.0% |
| Operating Expenses | $1.09B$971.72M | +12.6% |
| Operating Income | $1.61B$818.03M | +97.2% |
| Net Income | $1.34B$518.52M | +158.4% |
| EPS (Basic) | $2.76$1.05 | +162.9% |
| EPS (Diluted) | $2.74$1.04 | +163.5% |
| Shares Outstanding (Basic) | 486.02M494.39M | −1.7% |
| Shares Outstanding (Diluted) | 488.84M496.73M | −1.6% |
05—Questions
Frequently Asked Questions
What is the primary driver behind Analog Devices' significant revenue and net income growth in the reported period?
The significant growth in revenue and net income is primarily driven by strong, broad-based demand across key end markets, particularly the Industrial and Communications sectors. Favorable product mix and increased manufacturing utilization also contributed to margin expansion.
How does the acquisition of Empower Semiconductor fit into ADI's strategy?
The acquisition of Empower Semiconductor, Inc. for approximately $1.5 billion is aimed at enhancing ADI's power technology portfolio, specifically through the addition of integrated voltage regulators and power management solutions. This move is expected to contribute to future economic benefits and strategic positioning.
What are the key risks or uncertainties facing Analog Devices as highlighted in this report?
Key risks include an ongoing investigation into a cybersecurity incident that occurred in June 2026, potential material adverse effects from an IRS tax assessment related to transfer pricing, and general market and geopolitical uncertainties that could impact demand and supply chains.
How is Analog Devices managing its liquidity and capital resources?
ADI maintains robust liquidity through cash, cash equivalents, and short-term investments totaling $2.3 billion. The company also secured a new $3.0 billion 364-day revolving credit facility. Management believes these resources, combined with expected cash from operations, are sufficient to fund operations, capital expenditures, and other corporate needs for at least the next twelve months.
06—Continue