ADI Numbers look super!
NORWOOD, Mass., May 17 /PRNewswire/ -- Analog Devices (NYSE: ADI - news) today announced revenues of $581 million for the second quarter of fiscal 2000, up 71% from the prior year's second quarter and 19% above the immediately prior quarter. Diluted earnings per share increased to $0.32, compared to $0.11 for the year-ago quarter, and were up 28% from
$0.25 for the first quarter this year.
``The market shift from data processing to signal processing has created large opportunities for ADI's high-performance analog and DSP technology, particularly within the communications market as wireless and broadband usage accelerates,'' said Jerald G. Fishman, President and CEO. ``Our second-quarter analog revenues grew 57% year over year and 15% sequentially, while our DSP revenues grew 134% year over and year and 32% sequentially. ADI's growth in these two key product areas was again well ahead of the markets' growth, as we continued gaining market share in both product areas.
``Our sales into the communications market continued to accelerate during the second quarter, rising 123% over the same quarter last year and 29% from the immediately prior quarter,'' Mr. Fishman said. ``Communications customers comprised 45% of the second quarter's revenues, up from 34% for the second quarter last year and 40% for the immediately prior quarter. We are benefiting from accelerating demand for increased bandwidth as Internet usage continues to grow dramatically. DSL, cable modems, central office concentrators and optical networking products are all growing rapidly. We are also seeing strong growth
for wireless products used in cellular handsets and base stations, as well as for products used in wireless Internet appliances.
``In addition,'' he continued, ``we are seeing strong growth in high-end digital entertainment products used in digital cameras, VCRs, DVD players and high-performance flat panel displays, all areas where we enjoy high market shares. And sales into PCs continue to increase as the analog content per PC increases, with ADI technology providing important functionality in both laptop and desktop PCs.''
Mr. Fishman also said, ``The industrial market continues to be an important source of revenue for ADI. We are the leading supplier for digital motor control components, and revenues for products used in medical imaging and automatic test equipment applications also grew significantly during the second quarter.''
Turning to the quarter's financial performance, Mr. Fishman said, ``Gross margin improved 160 basis points sequentially to 55.7% of sales. The operating expense ratio for the quarter declined to 27.8% of sales from 30.1% for the first quarter, despite increases in R&D and higher sales commissions associated with our strong sales growth. Our higher sales, higher gross margin and a lower operating expense ratio increased our second-quarter operating profit ratio to 27.9% of sales, a record for ADI. Diluted earnings per share increased to a record $0.32, up 191% from the second quarter last year and 28% sequentially, despite an increase in the tax rate to 30% due to rising profits in higher tax jurisdictions. We anticipate that the tax rate will be approximately 30% for the next several quarters.
``Our balance sheet continued to strengthen during the second quarter,'' he added. ``Cash flow totaled $116 million prior to paying off our remaining $80 million of debt, which increased our cash position to $931 million. Days of inventory and accounts receivable also improved during the quarter.''
Looking forward, Mr. Fishman observed, ``2000 is shaping up to be a great year for Analog Devices -- perhaps our best year ever. Our large backlog has given us good visibility and we believe that third-quarter sales could rise 10 to 12% sequentially. This would lead to third-quarter revenues of $640 to $650 million and diluted earnings per share of approximately $0.36 to $0.37. We have also revised upward our revenue expectations for the year. We now believe that our year-over-year revenue growth could exceed 65%, which would result in our fiscal 2000 revenues exceeding $2.4 billion, or approximately $1 billion more than for last year. We also believe we can continue achieving good operating leverage on increasing revenues.
Perry P. |
