Analog Devices' (ADI) fiscal first-quarter results fell less than expected year over year amid gradual improvement in bookings, while the chipmaker issued an outlook above market estimates at the midpoint for the ongoing three-month period.

Adjusted earnings came in at $1.63 per share for the quarter ended Feb. 1, down from $1.73 the year before, but ahead of the FactSet-polled consensus of $1.54. Revenue decreased 4% year over year to $2.42 billion, but topped the Street's view for $2.36 billion. The stock gained 4% in premarket activity.

"(Analog Devices) delivered first quarter revenue, profitability, and earnings per share above the midpoint of our outlook, despite the challenging macro and geopolitical backdrop," Chief Executive Vincent Roche said in a statement. "Our recovery is being propelled by improving cyclical dynamics and numerous new wins across our franchise converting to revenue."

For the current quarter, the semiconductor manufacturer anticipates adjusted EPS of $1.68, plus or minus $0.10, and revenue of $2.5 billion, plus or minus $100 million. The Street is looking for non-GAAP EPS of $1.66 and sales of $2.46 billion.

"Bookings continued to show gradual improvement during the first quarter with strength in industrial and automotive positioning us to grow sequentially and year-over-year in our second fiscal quarter," according to Chief Financial Officer Richard Puccio. "We remain confident that fiscal 2025 represents a return to growth for ADI."

In the first quarter, revenue in the company's industrial segment revenue fell 10% year over year to $1.08 billion, while automotive moved down 2% to $732.5 million. Consumer sales climbed 19% to $322.9 million, while communications revenue declined to $289.9 million from nearly $302 million in the prior-year period.

Gross margin improved by 30 basis points year over year to 59% during the quarter, while the operating margin fell 300 basis points to 20.3%. Total operating expenses rose to about $939 million from $888 million last year, according to the company.

Analog Devices said late Tuesday that its board of directors approved an 8% increase in its quarterly dividend to $0.99 a share. The dividend is payable March 17 to shareholders on record as of March 4.