Analog Devices, a chipmaker based in Wilmington, Massachusetts, saw its stock fall by 7% in premarket trading following a drop in sales for its fiscal third quarter. The company also issued a warning about softening demand.
Sales and Earnings Performance
For the three months ended July 29, Analog Devices reported sales of $3.08 billion, which is down 1% from the previous year. This figure fell short of analysts’ expectations, who were projected sales of $3.10 billion.
Adjusted earnings for the quarter came in at $2.49 per share, slightly below the anticipated $2.52 per share.
Customer Inventory Adjustments and Economic Conditions
Analog Devices’ Chief Executive, Vincent Roche, noted that the customer inventory adjustments mentioned in the previous quarter have accelerated as economic conditions deteriorate. However, he also highlighted that the company is well-positioned with a diverse base of customers and can withstand a period of softer demand.
Outlook for the Current Quarter
Analysts surveyed by FactSet revealed that Analog Devices’ current-quarter outlook for sales and adjusted earnings falls below their expectations as well.
Despite these challenges, the company remains determined to navigate the shifting market landscape.