Key Points

The company posted some strong growth numbers in its fiscal second-quarter fundamentals. It saw a bulge in demand that might not be repeatable, however. 10 stocks we like better than Analog Devices ›

Semiconductor company Analog Devices(NASDAQ: ADI) published its latest quarterly earnings report Thursday morning, but despite its estimates-beating performance, investors sold out of the stock.

They left it with a more than 4% drop in share price on the day, on concerns that a lingering tariff war could badly affect its fundamentals. That decline compared unfavorably to the S&P 500's (SNPINDEX: ^GSPC) marginal slide.

Powerful double-digit growth

For its fiscal second quarter of 2025, Analog Devices' revenue came in at $2.64 billion, 22% higher year over year. Headline net income grew far more robustly, increasing by almost 89% to just under $570 million. On a non-GAAP (generally accepted accounting principles) adjusted, per-share basis, the company netted a profit of $1.85, up from the $1.40 it booked in the same period of fiscal 2024.Image source: Getty Images.

Analysts were expecting lower numbers. Their consensus projection for revenue was $2.51 billion, and that for adjusted profitability was $1.70 per share.

In its earnings release, Analog Devices attributed the double-digit gains to both internal and external factors. It quoted CEO Vincent Roche as saying, "Against a backdrop of global trade volatility, our performance reflects the ongoing cyclical recovery, and the strength and resiliency of our business model."

Tariff-related demand

During the quarter, Analog Devices took in nearly $850 million for its products used in current-generation automobile systems.

This critical part of its business grew by 24% year over year; however, the company said this was due in part to heightened demand in anticipation of the Trump administration's tariffs. The company's personal electronics business was also affected similarly. That's concerning, as it's very likely such demand isn't sustainable, no matter how the tariff war plays out.

Nevertheless, Analog Devices is still anticipating growth. It proffered guidance for its current (third) fiscal quarter, stating that revenue should be $2.65 billion to $2.85 billion, and adjusted net income $1.82 to $2.02 per share. On average, analysts are estimating $2.62 billion on the top line, and $1.82 per share for adjusted profitability.

Should you invest $1,000 in Analog Devices right now?

Before you buy stock in Analog Devices, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Analog Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Story Continues

Consider whenNetflixmade this list on December 17, 2004... if you invested $1,000 at the time of our recommendation,you’d have $644,254!* Or when Nvidiamade this list on April 15, 2005... if you invested $1,000 at the time of our recommendation,you’d have $807,814!*

Now, it’s worth notingStock Advisor’s total average return is962% — a market-crushing outperformance compared to169%for the S&P 500. Don’t miss out on the latest top 10 list, available when you joinStock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 19, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Why Analog Devices Stock Fell by More Than 4% Today was originally published by The Motley Fool

View Comments