Analog Devices (ADI) 28 Feb 182018 Q1 Earnings call transcript

Good morning, and welcome to the Analog Devices First Quarter Fiscal Year 2018 Earnings Conference Call, which is being audio webcast via telephone and over the web. I'd like to now introduce your host for today's call, Mr. Michael Lucarelli, Senior Manager of Investor Relations. Sir, the floor is yours.

Thank you, Jennifer. everybody. morning, good And our XXXX joining call. first for conference quarter Thanks ADI's call Roche; With the are CEO, Mahendra-Rajah. me on Prashanth today Vincent CFO, and ADI's relating the find missed you financial and who investor.analog.com. schedules Anyone at release, it can call archived the be conference recording our section at is and Investor live This a webcast will of Relations website. being

earnings recent light our in of XX-Q. forward-looking statements as to call. and various materially release of We the obligation statements date statements. Actual forward-looking forward-looking of including as disclosures. opinion to about from on new These in update and includes forward-looking information our these we're of to no may outlook, undertake information differ a discuss, most those reflect or discussed Now The the this including factors, events. these statements our result objectives results our future

our special Our section GAAP to quarter. include will our schedules, When under our financial of first I'd information measures and on commentary non-GAAP quarter we've XX-week investors quarter special measures our are which like results. in these at that Results investor.analog.com. from Available and non-GAAP reconciliations comparable year-over-year most financial performance, remind today's are quarter ADI's to items. about which And exclude the release the prior a comparing to and about Quarterly items non-GAAP included results posted earnings first was directly measures results additional quarter their web also excluded lastly, first measures, historical our

Okay.

over CEO, to Vincent ADI's Roche. with So, I'll turn Vince? it that,

first our markets consumer now. the you came business. momentum share successful very fiscal Well, our of quarter quarter our business, across and the to our very results I'm XXXX Revenue another at good continuing and the Thanks, our morning, guidance offset BXB expected with in of strength everyone. first as across decline in in Mike, high for ADI with pleased was end quarter the

growth non-GAAP us in substantial free combined compared trailing company in place ago continues as share. in year-over-year our per Our cash the year earnings strong resulting combined and the quarter, margins our the to expansion diluted operating to months S&P highest adjusted flow XX increase in tier execution the over delivered XXX. a company And margin XX% a

So end a digging The into highly markets. XX% sales applications, consisting in set industrial the of represented our of diverse, market, of quarter. fragmented approximately

bear some providing Our to X five have sales broad with market past by to for we the been we and we average On a increasing X% GDP expertise I'd a years, by market and why outperformed gained the this bringing right stellar, a X products, system-oriented insight an our remain our times of annually excited market domain into we've applications, little we've now customers at developing level, future. share over right time the outperforming today we this to believe engage spend why more times. into targeting like the as level. in believe

for signal across cutting in performing sector driven microwave of solutions The applications electronics also. and XG for enabling a complex and enables power mixed-signal is radar. Hittite unprecedented strong us require integration and advanced to deployment and The than doubles LTC's more combination as deployment data modernization mixed-signal and that business are of the market most by of array our largely portfolios and levels and example, continues business, solutions be growth development for ADI's phased the available chain fleet Microwave such highest market. power operations defense the and instrumentation and formation the our ADI test customers. our For aerospace battery center and edge existing RF new This

this with positioning is are the worldwide us In higher overall win to more Our engaged factory our benefit floors more who and striving technology more a to BOM changing variety of transform installations. and flexible expertise automated. and as output. industrial to productivity customers become for continues higher business greenfield domain automation and Customers process and in breadth of landscape, brownfield upgrades control are

Looking process true IoT, control, that the such for future with also ADI. combined and customer industrial content the will processing, automation referred to as connectivity enable data ubiquitous emerging of machines, expansion intelligence-enabled our believe sensing, to trends artificial as consistent engagements we and sensor-to-cloud real-time

factor require increasingly such sensing as the vibration, our modalities dollar developments market. For open in into proximity opportunity to industrial see as the and sector capabilities as example, In and that with move cobots I've this future, factory we coupled well the just to should applications, we described, XXXX. for that, long-term on the And as robots momentum floor X. content more our we bringing us of profitable underlying of are real-time These position short, area. the a continued growth the communications by across over trends will depth sensing highly-synchronized expand

turning This and the to So, represented in quarter quarter compared the weak. from growth in to first ago year wired sales now while the market. XX% remained wireless sector of strong communications benefited demand

all strong deep power bigger CapEx ADI's trials. we at Our high-speed the the share transceiver grow RF MIMO well in content, fueling single-digit solutions is about from and demand our excited rate for over as of microwave, portfolio, a in flat remain increased position business success. gains This and infrastructure as environment. We and and focus to our breadth processing share market, and with broad a XG trailing portfolio released our Massive co-designed recently due to emerging in continued business, depth. in products is verticals high increase with wireless unmatched and signal our wireless the XX relatively virtually has months management Hittite, integrated as despite our customer combined

application our to now in seasonality and automotive the than our at quarter from better areas. it sales, of strength performed infotainment business, on Turning the first XX% typical powertrain

this important for OEMs both improved and as stronger seasonal. particularly of efficiency that business solutions We grew increasingly combustion vehicles embrace their broad electric powertrain fleets. becoming engines us, electrification of Our see than

innovative past Our market that a see grown We audio experience. the major in years, with has over has momentum AXB to at infotainment creative leadership every region technology, architectures improve passenger solutions rate our OEMs five performance thanks the in come is market over single-digit video and geographical next continued enabling high and years. application our wins few area to will design which at secured audio that new the high

X positioned with combined gives and autonomous X me our example, grow acquisitions for vehicles, technologies next-gen systems necessary, well in times So compared In that both SAAR. business, to consumer X confidence first revenue long-term represented model Level quarter decreased as technology of times year-ago these our for XX% our businesses expected, quarter. beyond great sales safety in the our to for sensing and of organic at and to sequentially we're and

to delivering on acquisition, hand to So of success, profitable on, an exceptional something Prashanth, our I'd the we financial everyone best progress. like approach. and a LTC the and organization, and integrating for in and engineering that year company retention tremendous than give update of you is progress at And long-term manufacturing we've greater a believe call over sales, It's speak by following employee integration traditional closed of its past strong our this sum growth. parts nearly we made the building been before you common both goal I themselves. entire since when the point, results At working year across so of the M&A over look a towards our operations, measures is

realize when we achieve on to of the initial track to targeted and revenue synergies meaningful the So the complementarity we we over cost bases and can long-term continue our we that customer synergies we're the deal, announced products. given believe

integrated and content With expand, our continues sells least dollar for that fully opportunity confidence an opportunity into together, a $X opportunity us we working believe synergy now As more pipeline teams value that mixed-signal of giving ADI into sales a to equal ADI revenue. at system, of engineering converting rule our thumb, can power that and every there's in address. more billion-plus now

our start. our sensor-to-cloud, to kilowatts, ever nanowatts gigahertz and more to to to DC confident XXXX XXX digital very Analog the and it and domains more and more becomes digital, bridge up, With efficiently ability to as fiscal to from Devices' to is and off So capabilities needed to effectively strong wrap ability than in are world a come. shareholder for physical create autonomous more address we're opportunities beyond, years connected. value the

let that, me it with so And to Prashanth. hand over

XXXX Thank and Good Vince. first quarter my to me everyone, fiscal our call. earnings add you, welcome let morning,

items exception of will be on revenue the excludes my non-GAAP With which basis, press and release. expenses, outlined the adjusted comments P&L in today's on a items or line special non-op

quarter, the three to Before address I want I for items. to get our results

an announced global intention our Cuts of progress around Jobs the First, on update and our the and fab Act; operations. streamlining test our close announcement recent impact wafer aimed second, Last deleveraging. lastly, from month, Hillview and we Singapore Tax our the our to operations;

acquisition. represent we three-plus that careful built chain Once a we world-class and thoughtful have of and and in Following decision take this validated will and the about factory we XXXX. complete, operations outlined cost our million $XXX Day for portion closures of these ensure at smooth two June a down of the supply wind based on us It additional analysis, our overall transition strength organically years these the Analyst customers. a synergies capabilities through to significant

the results majority and quarter future will which current some include good Our charge in of expenses cash. relate will will year. one million, include to overall of have of a be payback action $XX approximately The GAAP program, which this a periods,

previously to Tax I that we statutory could tax the return on Next, our lower the our rate expect This change offset a level to Act a our Cuts benefits by which should on in a these no Investors are the impact of as non-GAAP Jobs comprehends rate and foreign XXXX. earnings. with estimates fiscal initial higher we analysis. discussed refine approximately assume to rate to the of and change long-term want of XX%, summarize ADI, caveat

be is However, until our take to in does tax next as to range fiscal X% our the year. our rate X% effect the higher foreign on earnings of non-GAAP XXXX not forecasted rate

million of tax to the almost me expect let eight net entirety on remaining in rate. me fiscal result last in to pay a my over our fiscal $XXX a that expense LTC charge net last reduction to GAAP times, and first with an tax times in pay years. approximately the the three ADI reconcile reform from million reinvested prior take to tax included year. moment down our each following delever of to XXXX, its which charge of non-GAAP topic, balances. ratio We the the return non-cash first more continue position million of this over was tax at deal close quarter first end value on XXXX the first million leverage. which So cash to deferred offset quarter by down approximately is our The years GAAP five X and included completely accrual related X.X the beginning we quarter earnings, $XXX $XX This from to and tax and brings in of years balance optimally indefinitely can tax and exited the $XX of times shareholders, plan to approximately from reform. We quarter our tax X.X the XXXX, debt-to-EBITDA In utilize a

shareholder debt capabilities, the our strong by quarter we our billion benefits once our can we to annually, to tax leverage and least XXXX. we ensure milestone ratio, that flow we confidence business, leverage continue achieve $X we we expect that across our fiscal generation allocation now the of value. reform, the exiting revisit this fourth our at capital optimize cash have with reduce strategy associated Given and momentum achieve will to Xx And

the now, So let's discuss quarter.

ADI. As XXXX X% in billion, midpoint seasonally quarter increased was X.XX guidance of sequentially for very and XX-week a mentioned, strong XX% the year-over-year above slower first the the Vince was quarter declining of while quarter. Revenue first

quarter deal market, industrial the X% mid-teens leverage week, ago. increased the XX% a operating revenue about now compared And led $XXX in backing expenses first at guidance Op margins by quarter synergies basis, our increased XX% million in expenses compared XX-week of of delivered the the combined were the out benefit and XXth margin year BXB revenue. fourth declined quarter completed or company increased in revenue of a OpEx in Strong million. of at or to first slightly the and op $XX operating which LTC on growth our end excluding same to growth guidance. expenses the outlined the sequentially. were quarter. We've of Non-op to at XX% upper XX.X% the end the came Gross Looking the year-over-year of in upper announcement. and

to be approximately per non-op We million a expect by million and quarter decline fiscal quarter expenses in our our XXXX. to $XX million $X $X second in

the Our non-GAAP first discussed, before in we the range X%. tax increasing was rate expect lower XXXX X% for of non-GAAP rate for $X.XX, diluted a And rate approximately XXXX. as tax $X.XX quarter of EPS related rate. tax expected to first quarter of previously to included was fiscal X% for benefit to the be long-term XX% our and to this our Non-GAAP

to levels in to or Excluding the the keep bookings balance and upper the guided wraps $X the on at I'll this X% primarily of result move Inventory production benefit, range. to BXB of service the million, the came based the decision with customer commensurate end our non-GAAP maintain environment. of EPS increased demand sequentially levels sheet. our That P&L,

was days XX our expect increased generated we the the We the of expect beginning quarter. Distribution quarter, of inventory the CapEx model in quarter second to XXX, the XXXX cash of and for And cash company to compared with to free fiscal was $XX in but sales. in free additions up of were months, million in our the over a flow million, outlook. we and adjusted inventory X% at billion. to trailing fourth CapEx $XXX decline about X.X the run combined in As $X.X year-ago weeks, of slightly in line result, quarter. the balance year days approximately

we $XXX million quarter, dividends. the During paid in

directors annual board X% represents to quarterly $X.XX an a per yesterday the share, $X.XX. dividend Our of in approved of which increase dividend

year-ago $X.XX of basis items with the XXXX, in for to of at now, planning to billion, the quarter revenue So second and exclude $X.XX fiscal in I'll outlook billion increase non-GAAP to compared the and the quarter for a second move exception We're which are also be expectations of revenue, the of the outlined release. XX% midpoint. the an today's quarter in range to on

to and a back BXB reminder, first quarter. include and XX-week quarter a industrial, to single-digit second this, As quarter are the planning of comms quarter more for and we aggregate we Adjusting our XX-week markets, sequentially a our for of capture of the COGS larger We're initial XX.X% to synergies. gross thus in automotive, a of amount to at was high mix final margins mix favorable in XX% a planning which business. range normal as represent is rate increase due tranche to be a and the

$XXX sales in range expect special in the expect at We margins of OpEx inputs, the for of of to quarter. operating percentage we of in to range to XX.X%, of $XXX $X.XX to XX% a the in these second be EPS, the and diluted second of excluding on quarter in to again. OpEx midpoint to implies guidance, this XXXX $X.XX. be items, once million sub the Based as range this XX% be And a million the

Industrial application great automotive, comms summarize, position to across to start all our outperforming a in by strong trajectory. a progress the areas. momentum making on We're off combined year. have So we're growth for company strong great the our continues on wireless. in to In we're putting driven

Mike for As over me started. session. the our very integration innovation we let are turn well, Vince pipeline that, is to mentioned, going getting rich, With LTC just it and our Q&A is

Okay.

please? self our to first to we'll initial one Let's our Operator, Please you an question opportunity we Q&A get have a give limit response, can question. our follow-up after session. for your question, and

Our from first Morgan comes Craig Hettenbach Stanley. question from

can you share where in view specific kind into of translating you Vince, that just you. in revenue? it you commentary terms examples any process in provide how for about thank Yes, of market are gains, there your A question

breadth to from we're in area Yes. enormously. the increasing of for Well, in we've sectors, were of enormously, resteering I LTC, about upgrades, where and as place were quite overlaps of playing the had Hittite And with customers seeing last Microwave the R&D areas about sales technologies is industrial several gains a benefiting combination the know, being the several think and over between the continued combine think defense our of in force also, before Craig. globally complexity sheer years able the a able that we're talk go and pretty talked what high an Also LTC digitalization forces have the we've And If that ADI. leadership our fleet market to share rich story. in we're that actual tuning just market sector, where growth example, benefiting mixed-signal. just system that opportunity, the complementary. But we were with and automation, sales I you to sure I and ADI's whole making we're our aerospace the focus portfolio, keep into space, position at the we portfolio large

large So the we're with the and depth of ever terms at customers, breadth gaining, small had. than I think customers, we've portfolio in more

the sector, of you think traditional products Hittites the to the – base of with the look area now – again, on starting wireless we're side mixed-signal communications the macro in at If again, strength benefit the with co-designed combined I see in particularly stations. ADI's, the

with if like, small macro for phased array developments becoming, cell these systems, integrated are standard MIMO in transceivers where Our traditional the systems antenna hybrid antenna massive being now used systems. are you

sector. XG, trials our the benchmark we're software-defined as the now begin and transceiver virtually massive And globally. in really trials all So for standard, those in is being that MIMO the

area, the have in I two in we share. I in area gains, demonstrable the those are in just – communications believe, wireless where So think some particularly subsets industrial market

Craig. Thanks for the question,

Great. Thank you.

of line Srivastava the from with Your next Ambrish comes question BMO.

us I in the business bit. that My question first happened had around segments? the public progressed deltas of I'm can you terms sorry help just help running had space, the and what provided apologize the Hi, little Just up ended so with? results guidance you just us you understand was a understand in you in as the quarter a Yeah. that

Can did results? you you business question, clarify reported sequentially in that the asking Ambrish? how the Are

to particularly for the Yeah. My and industrials. – in results each automotive certain segments, the for question guided the different – came also but is had in segment, you the of for results for all in expectations

results So were you expecting that were your different initially? transpired than what what

Thanks, yeah. Yeah, Okay. Ambrish.

are for indications did we level, do So at as no how did results longer through a But can would the provide BXB kind each the components BXB that how on walk the we broad We board actual, a versus segments -or that you the consumer. guidance some Mike our give reminder, year-over-year first across basis, of of each BXB so provide did not of good. quarter. segment the were very which of the now on

it if Ambrish, our pretty a single-digits. down to BXB the were bit We so in Vince highlighted look in – on sequentially, basis, areas down business, I X% we came they're be good Yes, down company combined mid his first And quarter. automotive guided infotainment, the sequentially stronger. a at results but you X% prepared think better seasonality. application powertrain is than was comments, typical which BXB

was Our which strong communications consumer, performed There's our In And as up led (XX:XX) business, growth, year-over-year, be and by thought year-over-year, grew digits percent is weak. that an really down what's weak. we important in It adjusted it basis good about seasonality no business, really or it's mid-teens wireless very I there think growth industrial expected. sequentially (XX:XX). again, double tough. we year-over-year it was once up there. but X% was It on it'd

Ambrish. questions, the for Thanks

(XX:XX).

follow-up? Do you have a

did. I Yes,

the either I but up. my Inventories if back typically dollar inventory was quarter, inventories said a were are through or in built year, days, last the I at yeah, years, but as several on go flat the side. inventories you inventory, question on look come you basis, So, in the that down. you to And expect terms of – down you you think

then year? what the go inventory should be through you understand of why you. seeing and So just as trending kind are down Thank us help we

Okay, the Thanks for question. thanks Ambrish.

mine $X that strategic can up decision So was had. idea was inventory outlook commensurate that B, other sort in high the maintain that $X built of levels driven green. for we're keep a of indicators BXB very a needed looks levels bookings everyone that sort demand levels million was of making as the six-week would in quarter-over-quarter. the as to customer the that – market, indicator by we that our and we looks all and range; like, Driven sure that bookings million times say following four- and or are a at what by, coal of about of service with we one, remain Most production X% target to like I or canary to inventory the lead made the

and is to that accounting and relatively Our consumer. see and we on LTC both without small, where see to was we QX parity, light But million general, balance policy decline immaterial activity. in change we book-to-bill stable, demand are no year. days times an ADI. good feel of normal above a amount we over for Part a cancellation the and about $X expect between harmonized inventory at pace with the Lead of the due of but we remain very in we that in

other... I'll one add Yeah,

Okay. Thanks details. for all the

another... add I'll

Vince. sorry, Yeah,

Yeah, (XX:XX) Ambrish.

quarters. where industrial And as course, sure we there, of been business. are positive, the supply Prashanth several we're we're demand for make a upside is lead keep our times internal can has level now at line is seeing eager the for what supply largest So, we that to the said, here. fabs book-to-bill our And the

normally why when our worth about would I higher think we first than kept the for at So quarter. clip internal considering a running fabs we do that's you think

Thank you, Ambrish.

you. thank Okay,

question, next Jennifer, please.

Research. Bernstein comes next line Stacy Rasgon of from Our question with the

Stacy. morning, Good

Stacy. Go for it,

on sorry, mute. on My I bad. I'm sorry, I I'm was Hello. mute. was

Okay.

with if taking Could in free – stuff cash the puts puts walkthrough us all on to than and on through you us see a lower tax takes. the have know I can flow little And bunch I just I walk my a a you was I there's quarter? questions. for going want everything takes with itself and to else. Thanks number and might of the give The want law expected.

going than normal I think on there's there more this quarter.

Yeah, absolutely.

the cash free we flow, the QX. buried in of there. for sort in So that hat-trick items Three had were –

First, federal paid first annual so our IRS, quarter. in to taxes payment large we the the were make

bonus Second, And our also we debt. every employee two-year our we once the then, make make once payment program. our every two-year payment for for interest

So way strong The outgoing and us some very lumpiness. cash see cash a as big convert at items expectations not we see of number. flow amount billion with generating last changed. to to that some is on The to profitability trailing high $X.X flow. basis, the over quarter the look a hit XX-month model do, strength flow, second on continue We has XX for the you'll in cash, cash there months,

Got you. it. helpful. Thank That's

I on longer-term synergies the a the For fab my question had follow-up, around closures.

or was two to So more looking In one years. closed take the like to Cambridge. closed to It when at facilities? five to three or Why three close these five to factories, your take three to it didn't it years factories. past, years Sunnyvale Linear years cull five you're Limerick the you've own did when you

the to operations, it I – multiple Milpitas does and be as case will that closures to years with we tends what the foundries and the it typically, LTC that's in years. Singapore and Well, take take There's the given believe about three our have tend recipes well. back-end three

many hundreds I recipes applications of our levels of and myriad of and our for keep service Our quality job, that the said, the hundreds and sure customers the that high across got. and is number – one, thousands make as we we've customers to

rule hard kick for earlier. to But most So but efficiencies likely thumb, we're can years, we three years. three it trying will push take in as obviously, the the that's as to of

just a is of going a I is facilities, quick the maybe but movement under among on covers Stacy, and comment net process result multiple bit external. add that, the is internal two quite And closures, would the what's

operations. the seeing cover, lot you're – shutting talking than two but the about a just So, complex more output, down it's under net the we're the

Got you, it. Thank guys.

you, Thank Stacy.

you. Thank

comes Your Sachs. of Toshiya Hari next question with from line the Goldman

the a hold? down Yeah. if think there? question. consumer being Great. the not, fiscal about Thanks for I the are I revenues change somewhere curious, XXXX, year potential And XX% I that the you the range In are between had things past, that taking what talked on was does guys just still question consumer some and of driving XX%. business.

Yeah.

XQ our somewhere Well, quarter-on-quarter imply on be So, basis. guidance year-over-year thank XX% would And you. consumer the a that a down in basis. of down region will again, look, XX% XX-week on about,

So And the We will meaningfully revenue. is on basis. remain expecting terms unchanged. XXXX an weakness XXXX portable our now within expectations be in least, the second of, over consumer half down believe we're expectations. up in at the our that of annual And first the shaping half range

that's of decline you our business. driven given still portable we've XX% XX% said, I number the to a So overall in business the as by stands. And

non-portable and grow the side company. shape is in continues to of audio/video, go Our A/V, good for the things prosumer

appreciate hope some are joining I – and the of what Thank this to about perhaps changes the terms that since I been going some that the learned during the a And the what prior you fully Great. yeah, joined to financials company you industry company? several timeframe things of And of of had you. for about is forward? didn't guess, you've – Prashanth. are the had months I guess, It's then the drive company that it's the I follow-up a you in ADI. question

quick given customers have strength which answer, I the than not Thanks. we're in continue is The incorporated are something but I in, thoughtful to a help something we our and customer community I space, is continue appreciate how fully you to that a give the spread to the in the markets – correlation this to to item, I'm our of that a if a a as we markets of don't give you base are and very sometimes the think we on. long other, the stability to broad continuously and much Sure. that different I'll on. wanted we semi-companies we that's embedded that The this business. investors That's BXB reflect more question that products are that ADI how close have going to and business impressed follow that, operate digital of closely of set appreciate investor perhaps, the to business will

Jennifer? Our next question,

Your line of comes Ross Deutsche from Seymore the Bank. question with next

Gerald Hey, of on is two behalf ones. Ross. Got (XX:XX) quick this

I guys OpEx, guided down. OpEx on First, see you

other we're for Understand, quarter, it's the think than be what's a little going it guiding range, down forward? XX- XX-week OpEx trajectory the to bit back expecting October I to basically but more. it the and

Right.

the way So to to the see – of bonus which and start you'll merit of second is flow in in, the increases, to the in of some begin impact starting our think that the OpEx performance metrics. come the items impacts quarter, the the for about normal including now, that

you'll second some adjust you were noise slowdown where the is The aligned first seasonal had to quarter, we week out as XXth that of see, of first if some as – that of the in quarter. in spending well of the we happens quarter the there's more in sort the fourth the quarter

drive in a so revenue, of we spend. second So, you which we But that put guide OpEx I profit. conversion nothing really the quarter, as target kind we would sub notable is expect great to OpEx the for in cash, of the the – more think us XX% continue be of of as we in the conversion the

we're And a year-on-year one implies there. get ADI, if over OpEx and and is the expenses And guidance our managing thing a look I time. growth. combined single-digit and mean, company, we're that capturing at (XX:XX) Linear Yeah, add good our is, we're – Gerald is synergies. you what result. to flat our that That's I high

If bit in in of is and the OpEx up year, would typically, because the quarter. say flat merit maybe little back you increases a it'll the I look half XQ fourth of in

think we'll this given that year I even to better synergies. the strive do than

that ask whole that you that. a business? business Is auto X follow-up, or passive on fall flattening a year I just under for grow X Thanks Or gives grew to in what probably safety regard? a And XXXX. think declines the your But it's auto safe in in in want you the you confidence confidence that what I And say that growth. off SAAR? a last times can as industry gives to a probably question as times to the

Yeah, good question.

you. me bit let a business the So, for parse

across million have said of business better high and X of in growing been in part third. our X And answers, the also, the was times roughly quarter. in than business as the first ADI The of Mike roughly that SAAR today one year-over-year And seasonal, ADI line has $XXX business of XXXX, first portion that; So, in is automotive two-thirds the XXXX, automotive target. quarter times of that our actually in business in prior single-digits. we LT. grew of to combination with a LT, a ADI the typically the

the revenue growth, over a will legacy though LT, business is the into that I tune least there. see of LT growing ADI already LT area, we we the side. logic of in it power that the opportunity see kind seeing piece and retune recovery the profitable will But was dollar rule of the the a start the that well, for – we're at ADI inherited single-digit even that tell on as every the at remarks, model. And to We're of high sector, now dollar in management. phase. But thumb portion and business in The use power. beginning least couple that pipe before for get higher we that the synergies we Hittite more battery of mixed-signal is coming So content, for power side, at piece the designs or already well prepared we that said there's single-digits. given of single-digits to into winning stabilized a XXXX, synergies as in organization we're growing pipe we're that the and area. BMS And for the of years, business that part mentioned the LT has the the the low management as spot you and the the the least trouble LT modestly, everywhere on we LT I starting is is from growing believe, of opportunity ADI

year. be the think of as management will to to And that expecting in quarter. be I this able we're is I during battery of double-digits our a grow part business strong beginning the So what the phases recovery said, second at

step take you single-digits XXXX low grew about combined a a – If was business. back, would say I year-on-year as

I is given think book our XXXX of better shaping business. up to that, be than

much. so Thanks

question Okay. Jennifer, please. next

question Bank Our from America. the comes next of with Vivek of Arya line

sales of seen off of parts? look kind couple forth. question. charts strong In level so quarters. taking not drivers, (XX:XX) visibility that consumption of Thank of that the of have What's and have the a last at when these automation have sort your you defense industrial couple over into Vince, aerospace, we of but been your mentioned very the for before, industrial and you growth, this my you

Yeah.

rate risk But and this that or what some building inventory of isn't is just then to convince you are at the look metrics kind sustainable kind other there somewhere? yourself growth of up

good a it's question. Yeah,

end I a not the look performance careful but are consuming. primarily, attention we customers into sell-through business, in channel, we our pay very ship to what of the what as and we what measuring think the at consumption. We company, sell-through

the backdrop, in market So you geographies double-digits that's foremost, look and say, year-over-year. our broad-based are and and applications is I case. up When very the first growth would all at

geographies PMIs, So phase. an the major globe, is again, they're the at And phase look converging globally. you into across in the expansion GDP expansionary all still across

So region to would continue macro another macro in optimistic. Asia and given from backdrop, our high-end of regions deployment we momentum vast and belief, into their And be you going that attention right XXXX I the the tell particular, in are good saying. experiencing now. PMI environment, pay which what the all the that, see to that situation of we'll are customers machinery board that are is year pragmatically we the XXXX, customers the the a our lot also, across And

thanks we us and and to stable Lead the short, book-to-bill good. times is are the channel not in please. Jennifer, question can give just does inventory of it and go is looking we what concern. I next the Vivek, very will for add, question. also are conscious very

is with Piper Harsh question Jaffray. Kumar from Our next

Hey, guys.

all, First results. congratulations strong on of some very

you. Thank

question I you. for had quick a and Vincent,

play on industrial, mean, you some a the in extremely the piggybacking what think end previous it's the to well of other as top doing I you question to you in, company it's function guys things doing markets characterize, do a are garner think that Sort that you of do could growth? over was, you that, or

question. good a It's Yeah.

company think, on products decided ago of as strategy investments our the pointing now the our that that I it's at and R&D, strongest BXB have is first the calls a our years we we BXB primarily the think of force were the focusing that area. and ADI's we several is and I crop ever retooled space in sales one Industrial been.

content we gain bits. that can't be industrial to will to our at level nanowatts the So others big customers, kilowatts, in our customers' take that's defense – We're all has I are And microwave And it getting these and combination Hittite think that gain. catalyzed and to across I complete as more problems of and a system, able solve really you tell to areas with areas. in able the content a sensor-to-cloud, we're well instrumentation, small. aerospace both

them, that earlier, with ever as a think mentioned complete serving strengthens we've position of more and ADI and company needs, I to being for just application the we and the customers' the to how sales enables got force the large as bear, we is globally. arsenal our bring and focus that build our customers. LT products we're that part able And cover do to and more combination and So I technologies solutions of a sheer we've got

working well. a it's think case I So of converging engine innovation

ever and share and able now are area. are industrial several sure we that to and advantage making we've they've stronger been the years in been, gain competitive than Our customer engagements build focused for

Thanks up we last I'll bets as go in would to internally a where choose the saying, question. we progress for our I to remarks, – and invest have on And a secular the question, that choose very we innovate. trends paying see off we selecting see by where maybe his Harsh. to let's just you mentioned wrap where as Vince and prepared right growing Jennifer, placing well. good the

And comes our from with final JPMorgan. Harlan question Sur

Good you morning. the and quarterly question my taking execution. for on great job Thank

Macroeconomic the a of guys at demand just Just sense geographies? could get here just Maybe on wanted trends you how broad-based was a to the take remain underlying about a it for in trends and look from demand year-over-year talk relatively perspective. back the if step kind trends growth the geographical different and healthy. business,

to want you do Mike, that? take

sure. Yeah,

I geography design-in general, looking geography base But activity. every useful as us broad-based, industrial. you. mean, in revenue our the trends First, for region in digits we as caution is I'll in at it's up on not strength double is

share been to from. you as play. wireless really, mean, well. Our Vince about, given we've would given I say, good I our business did are would what definitely, scenario call follow-up? selecting growth gains, a better that we're talked globe Do doing across synchronized than benefiting is the has our this And we and I where global have it portfolio

– yeah. Great. the Thanks for

and there, for think that array I systems side, per that guys' space. to On content the XXXX pretty generation and dollar dollar engagement goes think, started I these you. competitor other a in the mil-aero phased defense-related one up to programs radar-based move Have both only if some Thank civil significantly, up And the to there's your you fire just step driver? it of relative remind then or of content is can architectures. more of prior applications, us

these of the remain in history and systems. commercial past aerospace gain the we've many, somewhere aircraft upgrades, old radar Analog goes probably say there's sectors from in goes the would content and area. the area the believe, the deployments. of the digitalizing phased from, there digitalization, the architectures of and highlighted systems, SAM within probably between array the And in The I the conversations to used types future, the in $X in look, antenna depending on civil strong And, Well, Yeah. defense aerospace recent for sub fleet in for in terms and prognosis many applications example, past different area. those $XXX,XXX million systems we

very, opportunity these A for array – seeing systems you, we're phased and demand upside the compelling. very Lucarelli]>: So Thank Harlan. the Mike [XXXDKX-E is

this us you Thank quarter. Okay. all joining for

is call. the get wrap Jennifer, session. unable are Mike who available to today's always, Q&A on those As you up of for we can through

Analog Devices conference concludes This call. today's

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