Manufacturer of analog chips, Analog Devices (NASDAQ:ADI) will be announcing earnings results tomorrow before market open. Here’s what investors should know.

Analog Devices beat analysts’ revenue expectations by 1.5% last quarter, reporting revenues of $2.44 billion, down 10.1% year on year. It was an ok quarter for the company, with a decent beat of analysts’ EPS estimates.

Is Analog Devices a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Analog Devices’s revenue to decline 6.2% year on year to $2.36 billion, improving from the 22.7% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.54 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Analog Devices has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.4% on average.

Looking at Analog Devices’s peers in the analog semiconductors segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Himax delivered year-on-year revenue growth of 4.2%, beating analysts’ expectations by 7.3%, and Texas Instruments reported a revenue decline of 1.7%, topping estimates by 3.3%. Himax traded up 19.2% following the results while Texas Instruments was down 7.5%.

Read our full analysis of Himax’s results here and Texas Instruments’s results here.

Inflation has progressed towards the Fed’s 2% goal as of late, leading to strong stock market performance. Recent rate cuts and the 2024 Presidential election's conclusion added further sparks to the market, and while some of the analog semiconductors stocks have shown solid performance, the group has generally underperformed, with share prices down 4.4% on average over the last month. Analog Devices is down 3.1% during the same time and is heading into earnings with an average analyst price target of $250.98 (compared to the current share price of $216.67).

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