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A Look Back at Analog Semiconductors Stocks' Q2 Earnings: Analog Devices (NASDAQ:ADI) Vs The Rest Of The Pack


Petr Huřťák /
2022/09/30 3:10 am EDT
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Earnings results often give us a good indication of what direction the company will take in the months ahead. With Q2 now behind us, let’s have a look at Analog Devices (NASDAQ:ADI) and its peers.

Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.

The 9 analog semiconductors stocks we track reported a decent Q2; on average, revenues beat analyst consensus estimates by 3.31%, while on average next quarter revenue guidance was 1.83% above consensus. Tech multiples have reverted to the historical mean after reaching all time levels in early 2021 and analog semiconductors stocks have not been spared, with share prices down 12% since the previous earnings results, on average.

Analog Devices (NASDAQ:ADI)

Founded by two MIT graduates, Ray Stata and Matthew Lorber in 1965, Analog Devices (NASDAQ:ADI) is one of the largest providers of high performance analog integrated circuits used mainly in industrial end markets, along with communications, autos, and consumer devices.

Analog Devices reported revenues of $3.1 billion, up 76.8% year on year, beating analyst expectations by 1.7%. It was a decent quarter for the company, with a exceptional revenue growth but an increase in inventory levels.

“ADI delivered its sixth consecutive quarter of record revenue, fueling adjusted earnings per share to a new all-time high. These results reflect the agility of our hybrid manufacturing model as well as the essential role our high-performance analog, mixed signal, and power portfolio plays across numerous secular growth trends,” said Vincent Roche, CEO and Chair.

Analog Devices Total Revenue

Analog Devices scored the fastest revenue growth of the whole group. The stock is down 20% since the results and currently trades at $143.15.

Is now the time to buy Analog Devices? Access our full analysis of the earnings results here, it's free.

Best Q2: Monolithic Power Systems (NASDAQ:MPWR)

Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ: MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.

Monolithic Power Systems reported revenues of $461 million, up 57.1% year on year, beating analyst expectations by 7.06%. It was an exceptional quarter for the company, with a beat on the bottom line and a significant improvement in operating margin.

Monolithic Power Systems Total Revenue

The stock is down 21% since the results and currently trades at $364.40.

Is now the time to buy Monolithic Power Systems? Access our full analysis of the earnings results here, it's free.

Weakest Q2: Sensata Technologies (NYSE:ST)

Originally a temperature sensor control maker and part of Texas Instruments for 60 years, before eventually being spun out, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.

Sensata Technologies reported revenues of $1.02 billion, up 2.8% year on year, beating analyst expectations by 1.51%. It was a weak quarter for the company, with guidance for both the next quarter and full year missing analysts' expectations.

Sensata Technologies had the slowest revenue growth in the group. The stock is down 14.2% since the results and currently trades at $37.71.

Read our full analysis of Sensata Technologies's results here.

Microchip Technology (NASDAQ:MCHP)

Spun out from General Instrument in 1987, Microchip Technology (NASDAQ: MCHP) is a leading provider of microcontrollers and integrated circuits used mainly in the automotive world, especially in electric vehicles and their charging devices.

Microchip Technology reported revenues of $1.96 billion, up 25.1% year on year, in line with analyst expectations. It was a solid quarter for the company, with very optimistic guidance for the next quarter.

The stock is down 9.91% since the results and currently trades at $62.40.

Read our full, actionable report on Microchip Technology here, it's free.

Skyworks Solutions (NASDAQ:SWKS)

The result of a merger of Alpha Industries and the wireless communications division of Conexant, Skyworks Solutions (NASDAQ: SWKS) is a designer and manufacturer of chips used in smartphones, autos, and industrial applications to amplify, filter, and process wireless signals.

Skyworks Solutions reported revenues of $1.23 billion, up 10.4% year on year, in line with analyst expectations. It was a weak quarter for the company, with an underwhelming revenue guidance for the next quarter and an increase in inventory levels.

Skyworks Solutions had the weakest performance against analyst estimates among the peers. The stock is down 21.3% since the results and currently trades at $89.34.

Read our full, actionable report on Skyworks Solutions here, it's free.

The author has no position in any of the stocks mentioned