Post on 21-May-2020
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page1of24
AnalogDevices(ADI)EarningsReport:Q42015ConferenceCallTranscriptThefollowingAnalogDevicesconferencecalltookplaceonNovember24,2015,10:00AMET.Thisisatranscriptofthatearningscall:
CompanyPart icipants
AliHusain;AnalogDevicesIncorporated;Treasurer&DirectorofIRDaveZ insner;AnalogDevicesIncorporated;CFOVincentRoche;AnalogDevicesIncorporated;CEO
OtherPart icipants
RomitShah;NomuraSecuritiesCo.,Ltd.;AnalystChrisDanely;Citigroup;AnalystJohnPitzer;CreditSuisse;AnalystCraigEllis;B.Riley&Co.;AnalystToreSvanberg;StifelNicolaus;AnalystCraigHettenbach;MorganStanley;AnalystAmitDaryanani;RBC;AnalystChrisCaso;SusquehannaFinancial;AnalystWilliamStein;SunTrust;AnalystDavidWong;WellsFargo;AnalystHarlanSur;JPMorgan;AnalystVivekArya;BofaMerillLynch;AnalystSteveSmigie;RaymondJames;AnalystC.J.Muse;EvercoreISI;AnalystTristanGerra;RobertW.Baird;AnalystAmbrishSrivastava;BMO;AnalystHarshKumar;Stephens;AnalystRossSeymore;DeutscheBank;AnalystBlayneCurtis;Barclays;AnalystDougFreedman;SternAgee;AnalystIanIng;MKMPartners;AnalystStephenChin;UBS;Analyst
MANAGEMENTDISCUSSIONSECTION
Operator :
Atthistime,IwouldliketowelcomeeveryonetoAnalogDevicesfourthquarterandFYearningsconferencecall.
(OperatorInstructions)
Iwouldnowliketoturntheconferenceovertoyourhostfortoday,Mr.AliHusain,TreasurerandDirectorofInvestorRelations.Pleaseproceed.
AliHusain (Treasurer&DirectorofIR):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page2of24
Great.Thanks,Operator.Itfeelsgoodtosaygoodmorning,everyone.
ThankyouforjoiningADI'sfourthquarterandFYearningsconferencecall.Youcanfindourpressreleaseandtherelatingfinancialschedulesonourinvestorpageatinvestor.analog.com.
Asusual,thismorningI'mjoinedbyADI'sCEO,VincentRoche,andADI'sCFO,DaveZ insner.Theagendaforthismorningasisfollows.First,we'llprovideabriefoverviewofourfourthquarterandFYresults,andthenwe'llprovideourcurrentthinkingandouroutlookforthefirstquarterof.Andfinally,Vincewillcapstonethepreparedremarks,followingwhichwewillopenupthelinesforQ&A.
Sobeforewestart,let'sgetthroughtheimportantdisclosuresthatwehavetomakeeveryquarter.Pleasenotetheinformationwe'reabouttodiscuss,includingourobjectivesandoutlook,includesforward-lookingstatements.
Actualresultsmaydiffermateriallyfromtheseforward-lookingstatementsasaresultofvariousfactors,includingthosediscussedinourearningsreleaseandourmostrecent-K.Theseforward-lookingstatementsreflectouropinionasofthedateofthiscall,andweundertakenoobligationtoupdatetheseforward-lookingstatementsinlightofnewinformationorfutureevents.
Ourcommentstodaywillalsoincludenon-GAAPfinancialmeasures.WhichwehavereconciledtotheirmostdirectlycomparableGAAPfinancialmeasuresintoday'searningsrelease,whichwehavepostedonourIRpageatinvestor.analog.com.Solet'sgetstarted.
Asyou'velikelyseenfromthepressrelease,ADIhadanotherverystrongquarter.Revenueinthefourthquartertotaled$million,increasing%sequentiallyand%yearoveryear.
Theseresultswereabovethehighendofourguidancerange.Primarilyduetostrengthinportableconsumerdevises,andtoalesserextentfromsomerecoveryinthewirelesscommunicationsinfrastructuremarket.
ForourjustcompletedFY,revenuetotaled$.billion.Withindustrialapplicationsrepresentingthelargestportionat$.billionor%ofsales.Thebalanceofrevenuefortheyearwasaboutevenlydistributedacrossconsumer,communications,andautomotiveapplications.
Duringthefourthquarter,continuedstrengthinconsumerportabledevicesresultedin$millionofconsumerrevenue,whichwasasequentialincreaseof%.Here,ourprecisiontechnologyplatformsarebeingleveragedtodeliverhighlyinnovativeuserexperiences,andaredrivingverystrongROIforADI'sR&Dinvestments.
Revenuefromcommunicationsinfrastructurecustomersrepresented%ofrevenue,andincreased%sequentiallyinthefourthquarterwhichwasaheadofexpectations.Wirelineapplicationsdecreasedsequentially,whilethecombinationofinventoryreplenishmentandimprovingwirelessCapExspenddroveourstrongwirelessinfrastructure'ssequentialrevenueperformance.AscustomerscontinuedtodeployourhighlyinnovativemicrowaveandRFsolutions.
Despitethisneartermrebound,wirelessbasestationdeploymentsarewellbelowpriorpeaks.AndI'dsaythesameistrueforADI'swirelessinfrastructuresales.
Duringthefourthquarter,ourbroadandhighlydiversifiedindustrialendmarketdecreased%sequentially,whichwasinlinewithseasonalpatterns.Alloftheindustrialsubsegmentswithintheindustrialbusinessdeclinedsequentially,withtheexceptionofaerospaceanddefensewhichwasstabletothepriorquarter.
Asyouknow,theindustrialmarketisourmostdiversecustomerbase.Itspansmanydifferentsub
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page3of24
segments.Itrequiresourhighestperformancetechnology,asyouwellknow,italsosupportsverylonglifecyclesandearnsabovecorporateaveragegrossmargins.
Duringthefourthquarter,ourautomotivebusinesshad%ofsalesthatperformedinlinewithexpectations,andwasstabletothepriorquarter.Whileneartermdemand,webelieve,isbeingimpactedbylowerthananticipatedsalesofpremiumvehiclesinChina,premiumautomotivesupplierscontinuetoincorporateADI'shighperformancetechnologiesinapplicationssuchasradar-basedadvanceddriversystemsystemsandpowertrainefficiencysystems.Whichgrew%and%respectivelyduringtheFY.
Automotiverevenuefortheyeartotaled$million,growingata%revenueCAGRoverthepastfiveyears.Whichisinfactthreetimestherateofvehicleunitgrowthoverthisperiod.Sointotal,ADI'sFYrevenueincreased%fromtheprioryear,andtotaled$.billion.
SonowI'dliketoturnthecallovertoDavefordetailsofourfinancialperformanceinthefourthquarterandinFY.Withtheexceptionofrevenueandotherexpense,Dave'scommentsinfourthquarterandFYP&Llineitems,freecashflowandfreecashflowmarginwillexcludespecialitems.Whichintheaggregatetotaled$millionforthequarter,and$millionrespectivelyfortheyear.
Whencomparingourfourthquarterandfull-yearperformancetoourhistoricalperformance,specialitemsarealsoexcludedfrompriorquarterandyear-over-yearresults.Andreconciliationsofthesenon-GAAPmeasurestotheircomparableGAAPmeasuresareincludedonScheduleEandScheduleFintoday'searningsrelease.Sowiththat,Dave,I'llturnitovertoyou.
DaveZinsner (CFO):
Thanks,Ali.Goodmorning,everyone,andthankyouforjoiningus.
ThefourthquarterwasonceagainaverystrongandprofitablequarterforADI.Andwesetrecordsforquarterlyrevenue,earningspershareandcashflowgeneration.
Revenuethisquarterincreasedtoarecord$million,anddilutedearningspersharewas$..Withbothresultsabovethehighendofourguidance.Grossmarginsthisquarterwere.%,whichwasinlinewithourguidanceanddownbasispointsfromthepriorquarter,primarilyduetomix.
Daysofinventoryinthefourthquarterdecreasedtodaysfromthepriorquarter'sdays.Primarilyonhigherrevenue,anddollarsofinventorydecreased$millionoverthepriorquarter.
Weeksofinventoryindistributionwereapproximately.weeks,whichwasconsistentwiththepriorquarter.Totalendcustomerordersdecreasedinthefourthquarterascomparedtothethird,whichisquitetypicalinadvanceofaseasonallyslowfirstquarter.Andourbook-to-billwasbelow.
Operatingexpensesinthefourthquarterincreased%sequentially,laggingwellbehindthe%sequentialincreaseinrevenue.Aswecontinuedtomanageoperatingcostsverytightly,allowingustogainmoreoperatingleverageinourmodel.Asapercentofsales,operatingexpensesinthefourthquarterdeclinedoverbasispointscomparedtothepriorquarter,anddeclinedoverbasispointscomparedtothesameperiodayearago.
Operatingprofitsbeforetaxincreasedto$millionor.%ofsales.Whichisbasispointshighercomparedtothepriorquarter,andbasispointshigherthanthesamequarterintheprioryear.Otherexpenseinthefourthquarterwasapproximately$million,andrepresentedthenetinterestexpenseonourdebt.
Ourannualtaxratewaslowerthantheratewehadanticipatedattheendofourthirdquarter.Asaresult,wetruedupourtaxrateinthefourthquarterofFY,whichhadtheeffectofincreasingthefourthquarterEPSby$.pershare.Evenwhenexcludingthepositiveimpactfromthetaxadjustment,diluted
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page4of24
earningspersharegrew%sequentiallyonthe%increaseinrevenue,andwasagainabovethehighendofourguidance.
Cashflowinthefourthquarterwasverystrong.ExcludingaspecialpaymentassociatedwiththeconversionofourIrishpensionplan,ADIgenerated$millionor%ofsalesinoperatingcashflow,andCapExwas$million.Resultinginfreecashflowof$millionor%ofrevenue.FYcapitalspendingwas$million,andourplanforisforcapitalspendingtobebetween$millionand$million.
Attheendofthefourthquarter,ourcashandshort-terminvestmentbalancewas$billion,withapproximately$millionavailabledomestically.Wehadapproximately$millionindebtoutstanding,whichresultedinanetcashpositionof$.billion.
Duringthequarter,wereturned$milliontoourshareholdersintheformofdividendsandsharerepurchases.Whichincludedhighersharebuybackactivityof$million,asourbuybackprogramrespondedtothevolatilityinourstockprice.
OnNovember,,ourBoardofDirectorsdeclaredacashdividendof$.peroutstandingshareofcommonstock.ThisdividendwillbepaidonDecembertoallshareholdersofrecordatthecloseofbusinessonDecember.
Nowletmetakeamomenttotalkaboutourperformancein.Revenuesof$.billionincreased%overtheprioryear,andnon-GAAPdilutedearningspershareincreased%to$..
Ourcashflowgenerationwasstrongduringtheyear.ExcludingthepreviouslymentionedIrishpensionplan,operatingcashflowswere%ofsalesorover$billion,andfreecashflowwas%ofsalesor$millionfortheyear.
Duringtheyear,wereturned$milliontoshareholdersindividendsandsharerepurchases.Wealsoincreasedourdividendby%inFY,whichwasourthdividendincreaseinthelastyears.
Alltold,ADIhadaverygoodfourthquarterandFY.Ourfinancialmodelconvertedtoplinegrowthintoverystrongearningsgrowth,andwecontinuedtogeneratestrongcashflowswhileenhancingshareholderreturns.
Sonowtoouroutlookforthefirstquarter.Which,withtheexceptionofrevenueexpectations,isonanon-GAAPbasis,andexcludesspecialitemsthatareoutlinedintoday'srelease.
Ourcurrentexpectationsforthefirstquarterofisforrevenuetobeintherangeof$millionto$million.Whichwouldrepresentasequentialrevenuedeclineofapproximately%to%.Itisimportanttonotethatexcludingconsumer,ADIrevenuesatthemidpointofthisrangeareexpectedtodeclinesequentiallyatamidsingledigitratewhichisinlinewithseasonaltrends.
Themostsignificantsequentialrevenuedecreaseisexpectedtobeinourconsumerbusiness.Whichisseasonallydowninthefirstquarter,butwilllikelyexhibitmorepronouncedseasonalityafteraverystrongfourthquarterinwhichitgrew%sequentially.Intheindustrialandautomotivemarkets,wealsobelievethatseasonaltrendswilllargelyprevail.
Ourcommunicationsinfrastructurebusinessisexpectedtoremainrelativelystabletofourthquarterlevels.Aheadofseasonalpatterns,onacontinuationofthemodestbutsteadyrecoveryinthismarket.
Themidpointofourguidancerangerepresentsanincreaseof%yearoveryear.Andwouldmarktheninthconsecutivequarterofyear-over-yearrevenueincreasesforADI,whichwouldbequiteagoodachievement.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Givenourplanforlowersequentialrevenueandasistypicalinourfirstfiscalquarter,wearereducingproductionlevelsinthefirstquartertoapproximately%fromtheircurrentmid%level.Asaresult,weexpectthefirstquarterofgrossmarginstobeapproximately.%.Byremainingdisciplinedonourproductionlevels,webelieveinventorieswillbewellpositionedtosupportstrongleverageonceweresumesequentialrevenuegrowth.
Weexpectoperatingexpensesinthefirstquartertobebetween$millionand$million,whichwouldrepresentasequentialdeclineofapproximately%.We'replanningforourtaxratetobeapproximately%inthefirstquarter,whichisalsoourplannednon-GAAPtaxrateforFY.
Intotal,excludingspecialitems,weexpectdilutedearningspershareinthefirstquartertobebetween$.and$..Atthemidpointofthisrange,dilutedearningspershareisexpectedtogrow%yearoveryear.Andthiswouldrepresentthethconsecutivequarterofyear-over-yearearnings-per-sharegrowthforADI,whichwouldalsobeaverygoodresult.
Webelievethatourfinancialresultsareagoodproofpointthatourstrategytofocusonsustainableinnovationacrossdiverseapplicationsandmarketsisworking.Andwiththat,I'llturnitovertoVince.
VincentRoche,AnalogDevicesIncorporated-CEO
Thankyou,Dave,andgoodmorning,everyone.AsDaveandAlihavehighlighted,FYwasaverygoodyearforADIintermsofourfinancialperformance.
Ourstrategy,whichemphasizestechnologyinnovationandplatformreuseacrossthediversityofapplications,proveditselfonceagain.Thuseventhoughtheuncertainmacroeconomyimpactedindustrialandautomotiveandcyclicalheadwindsreducedcommunicationsinfrastructuresales,theseweremorethanoffsetbysignificantuptakeofoursignalprocessingtechnologyinportableconsumerdevices.
Itwasalsoanexcellentyearintermsofkeyaccomplishments.In,wesuccessfullyintegratedHittite,andexpandedavailableopportunitiesthatwebelievewilldeliverstrongrevenuesynergiesstartingin.Ourintegrationteamsandprocessesarefinallytuned,andhavesuccessfullyachievedourcostsynergytargetswhichareexpectedtoacceleratefurtherin.
Duringtheyear,wecontinuedtoalignourinvestmentstocriticalstrategicpriorities.Streamliningourmanagementstructure,whilemakinginvestmentstosupportourfuturegrowth.Butaswetakestockattheendofthisfiscalyear,Ithinkit'simportanttolookatourpastperformanceoveralongerperiod,andprovideinvestorssomecontextonwherewehavecomefromandwherewewanttotakeourCompany.
Overthelastthreeyears,despiteanunevenmacroeconomicbackdrop,wehavegrownourrevenueatan%annualizedgrowthrate.Andwehaveconvertedthistoplinegrowthinto%dilutedearnings-per-sharegrowth.We'vealsobeencommittedtoreturningcashtoourinvestors.
Overthelastthreeyears,wehavegrownourdividendata%annualizedratewhilereturning$billiontoshareholdersindividendsandsharebuybacks.AndourannualizedTSRoverthisperiodis%,whichisinfacthigherthantheS&Preturnoverthisperiod.
AsDavementioned,ADI'sFYdilutedearningspersharewere$.,anditisourgoaltoincreaseournon-GAAPearningspersharetoupto$byFY.AndIthinkthisisalsoanopportunetimetopointoutthataswestandtoday,weareinfactaheadofthisscheduleinreachingthisgoal.
We'vealsoinvestedandcontinuetoinvestinfuturegrowthopportunities.Overthepastthreeyears,we'veinvestedover$billioninfuturegrowthinitiativesthroughR&Dandthedayandcapitaladditions.Thesearesignificantinvestmentsthatwebelievehavebeenmadeattherighttimeinour
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Company'shistory,andholdusingoodsteadforthecomingopportunitiesthatwebelievewilldriveourfuturegrowth.
Overourfirstyears,wehavecreatedatremendousmarketsharepositioninthefoundationaltechnologiesthatformvirtualbridgesbetweenthephysicalanddigitalworlds.Whencustomersneedtoreliablysense,measure,interpretandconnectphysical,chemicalandbiologicalphenomenontocomputationaldomain,ADIhasbecometheirgo-tosupplier.Itisourviewthatastheworldbecomesincreasinglyconnectedandmachinesbecomemoreautonomous,thedemandformoreandmorevirtualbridgesisquitelikelytoincrease,andthistrendclearlyplaystoourcorecapabilities.
Inourterminology,webelievethattheinformationandcommunicationstechnologysectorhasentereditsthirdwave.Thefirsttwowavesweredominatedbybigiron,personalcomputing,mobilityandconnectivity.Variousmonikersarebeingappliedtothethirdwave,suchastheinternet-of-things,industrial.andsoon.
Whateveritscalled,it'sgoingtobeaboutthepervasiveusofartificialsensoryandcomputingpowerforpeopleandmachinestosee,tohear,tofeel,andsoonthroughoutthephysicalspace.Asthisthirdwavebeginstotakeshape,itiscreatinggrowthopportunitiesforADIthatweexpectwillbebeyondthoseachievedinthepriortwowaves.
ADI'syearsofsignalprocessingleadershipisatthecenterofthisthirdwave.Withthecombinationofthecloudandbigdata,wecanenableareal-timeunderstandingofwhat'sgoingoninourworldsothatwecanact,reactandpredictinhighvalueapplications.Inareassuchashealthcare,industrialandautomotiveapplications,forexample.
Infact,existingandnewcustomersareinvitingADItohelpthemtobuildevenmorevirtualbridgestoenablethemtounlockthelatentvalueandcreatepotentialnewrevenuestreams.Forexample,manyofourindustrialcustomerswhointhepastmayhaveworkedwithustocontrolthemostvaluableenginesandindustrialmachinesaretodaylookingtomassivelyinstrumentthoseverysamemachines.Andcapturethevaluecreatedbythedatatheygenerate.
Thevalueoftheinformationgenerated,infact,hasthepotentialtobecomeevengreaterthanthevalueoftheactualthingitisconnectedto.Andthisisveryexcitingforourcustomers,andinturn,it'salsoveryexcitingforushereatADI.
Wearetheacknowledgedmarketleaderinconvertersandamplifiers.Twoofthemostcriticaltechnologiesthatbridgethephysicalanddigitalworlds.Andwe'vealsofocusedsignificanttechnicaltalentovermanyyearsonthedevelopmentofultralowpowersensorsandmicrocontrollersthatareoptimizedforreliable,power-efficientIOTsolutions.
Equallyasimportant,ourrecentacquisitionofHittitemeansthatADIalsopossessesthefullrangeofactivitysolutionsnecessarytotransmitdatatothecloud.Foranalysisoftrendsandpatterns,andthenbacktothenodetobeactedupon.
We'vemadesteadyprogressthisyearinapplyingoursilicontechnologyandalgorithmheritage.Andstrengthsindeepdomainatapplicationsknowledgeatthephysicaledge,tocreatecompletesensor-to-cloudsolutionsthatareefficient,secure,andreliable.ThiscreatesthepossibilityforADItonotonlycreate,butalsotocaptureadditionalvalueaswemovemoredeeplyintotheinformationspectrum.
Wewillcontinuetobuildmomentuminthesenovelgrowthapplicationsintheyearsahead.Whileinsuringthatwecontinuetostrengthenourtechnologiesandcustomerengagementsinourcorebusiness.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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AtADIwe'reveryexcitedaboutapplyingourexpertisetocreatesolutionsthatsolvethemostimportantproblems.Leadingtosmartercities,smarterbuildingsandfactories,aswellastransforminghealthcare,andultimately,people'slives.
Nowthesearejustsomeofthemyriadofapplicationswithwhichwearehelpingourcustomers.OurcustomersareincreasinglyinvolvingADIearlyintheirinnovationconversations,andleveragingourcapabilitiestoarchitectsolutionstotheseverytoughchallenges.Asthethirdwavetakesroot,weexpectthatgrowthfromthesehighperformancesolutionswilldrivefuturerevenueandprofitgrowthforADI.
SobeforeIfinish,Iwouldjustliketoreiterateouroffspokenstrategicobjectives.Firstly,webelievethatinnovationdrivesbusinesssuccess.Wefocusonsizeablemarketsthatvaluetheperformancewedeliverinhighvalueareasattheintersectionofthephysicalanddigitalworlds.
Secondly,webelieveinthediversityofmarkets,applicationsandcustomers.Weplacemanymodestnewproductbetsincarefullychosenapplications,andengagedirectlywiththecustomersthatrepresentaverylargepartofourservedavailablemarket.Diversityinsuressustainabilityandresilience,andthishasbeenprovenbyourabilitytosuccessfullynavigatetheextraordinarytransitionsinthesemiconductorindustryoverthepastyears.
Thirdly,innovationanddiversityenableADItobuildwideandsustainableeconomicmotesthatenhanceshareholdervalue.Andofcourse,thisisallmadepossiblebythetalent,theingenuityandpassionofourglobalworkforcewhocontinuouslyraisethestandardsintechnology,customerengagement,supplychainandthemyriadofotherareasinabusinessascomplexasours.AsthemarketsweservemoveclosertoADI,Ifirmlybelieveourbestdayslieaheadofus,thankyou.
AliHusain (Treasurer&DirectorofIR):
Greatthanks,Vince.ForthoselistenersinterestedlearningmoreaboutADIintheIOTspace,werecentlywebcasta-minutepresentationthatactuallygoesintothistopicinmuchgreaterdetail,andyoucanfindallthatinformationonourIRpage.
Solet'stalkquicklyabouthowweruntheQ&Asession.I'mgoingtoaskyoulimityourselftoonequestion.We'regoingtorunthecalluntil,soafteryouaskyourprimaryquestionandifyoustillwanttoaskafollowon,youshouldrequeue.
Andaswesayeachquarter,werunthecallinthisformatinthespiritoffairnesssothatallcallersgetachancetoaskatleastoneoftheirquestions.Sowiththat,operator,let'sgototheQ&A.
QUESTIONS&ANSWERS
RETURNTOTOP
Operator :
(OperatorInstructions)
OurfirstquestioncomesfromRamitShahwithNomuraSecurities.
RomitShah (Analyst-NomuraSecuritiesCo.,Ltd.):
Yes,thankyou.Dave,justhistorically,Aprilhasbeenoneofyourbetterperiodsintheyear.Ithinkonaverageprobablyupmidtohighsingledigits.Butnowthatconsumerissuchamoresignificantportionofthebusiness,howdoyouthinkaboutseasonalityintheAprilperiod?
DaveZinsner (CFO):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Thanks,Romit.Ithinkyou'rerightinthatobviouslywhenwearemoreconcentratedinindustrial,wewouldhaveseenamuchbiggerrampseasonallyinthesecondquarter.Weexpecttoseethatseasonalityinthesecondquarterforindustrial,butconsumernowisalargerportionofourrevenueisabitofawildcard.Ithinkthatthatquarterisgenerallyseasonallydownalittlebit.
Obviously,wedon'thaveanyvisibilityintothequarteryet.Butthatwouldmutealittlebitthesequentialincreasethatyouwouldtypicallyseeinthesecondquarter.Butasyouknow,thisisthesemiconductorbusinessandyouneverreallyknowhowthingswillpanoutuntilyou'rereallyupontopofthatquarterandcanmakeabetterdetermination.
RomitShah (Analyst-NomuraSecuritiesCo.,Ltd.):
Thankyou.
DaveZinsner (CFO):
Sure.
Operator :
OurnextquestioncomesfromChrisDanelywithCitigroup.
ChrisDanely(Analyst-Citigroup):
Nicequarter,IguessyoucangotellTomBradytoeatyourheartout.SoifwelookwhathappenedinOctoberandJanuary,alittlemorerevenuevolatilitythanhistoricalatADI.
SoIguesstocontinueonRomit'squestion,howdowethinkaboutseasonalityin?Andwiththat$millionquarterlyrevenuebogey,whatgivesyouconfidenceyoucanexceed$millionineithertheJulyortheOctoberquarterin?Maybejusttalkaboutjustvisibilityontheconsumerfront?
DaveZinsner (CFO):
Yes,we'llhaveobviouslyalargerconsumerbusiness.Generallythesecondhalfoftheyearismuchstrongerthanthefirsthalfoftheyear,atleastfromafiscalyearbasisforus.Giventhatthat'sgenerallywhennewproductlauncheshappen,Christmasbuildshappen,andsoforth,sothatwilldefinitelychangetheseasonalityabitfortheoverallCompany.
MyguessisthattypicalseasonalityforADIisgoingtoberelativelysimilarsequentialincreaseseveryquarterfordifferentreasons.Obviously,thesecondquarterwouldbemoreofanindustrialstory.Thethirdandfourthquarterarelikelytobemoreofaconsumerstory.
Whatwasyourotherquestion,Chris?Imissedit.
ChrisDanely(Analyst-Citigroup):
Justtalkaboutvisibilityontheconsumerfront.Howyoufeelaboutmaintainingmarketsharethereinthesecondhalfoftheyear?Thatwouldsucceed$millioninrevenue.
DaveZinsner (CFO):
Wellagain,wehaverealconfidenceinrevenuewhenweactuallyhaveorders,andwehaveordersusuallyoutaboutthroughthefollowingquarter.Soit'sdifficultformetosaywhat'sgoingtohappenoverthenextfewquarters.ButIwouldsayourpositionwithallofourlargecustomersisverystrong,andweexpecttohaveastrongpositionwithallofthosecustomersoutforthedistantfuture.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page9of24
ChrisDanely(Analyst-Citigroup):
Thanks.
Operator :
YournextquestioncomesfromJohnPitzerwithCreditSuisse.
JohnPitzer (Analyst-CreditSuisse):
Congratulationsonthestrongresultsforthefiscalyear.Iguessanotherquestionontheconsumerside.Ifyoulookattherevenuerampoverthelastseveralquarters,thevastmajorityofthathasbeendrivenbyforcetouch.
Youguysarearelativelynewsupplierforanewapplicationthatthecustomerfeelsisimportantenoughthattheyactuallyhighlightitintheiradvertising.Andweknowthere'sbeensomeyieldissuesonthemoduleawayfromyou.Andifwetrytobackintoyourrevenuecomingfromforcetouchandtrytoequatethattoaunitnumberforyourcustomer,itdoesappearthatyou'reovershipping.
So,Dave,I'mwonderingifyoucouldhelpusunderstand.WhenyoulookattheJanuaryquarter,doyouthinkyouareovershippingtoyourcustomerrightnow?AndwhenyoulookattheguidanceforconsumerintheJanuaryquarter,doyougetmostofthatbackinJanuarysoyoufeelmorecomfortablethatyou'renotovershippingthedemandrightnow?
DaveZinsner (CFO):
Wellletmestartbysayingthatobviously,wedon'ttalkaboutindividualproductsandindividualcustomers.Ourcustomersdon'tappreciatethat,andit'sreallyuptothemtostarttalkingaboutwhattheirendmarketsaredoingandtheirapplicationsaredoing.ButI'lltalkspecificallyaboutourconsumerbusiness.
Clearly,thefirstorthebackhalfofthisyearhadaverygoodramp,andthatwasdrivennotbyonesingleproductduequitehonestlynotbyonesinglecustomer.Wedidannounceinour-K,wehada%customerfortheyear.Soobviously--andthat'sunique,soobviouslywedidhaveonecustomerthatdidquitewell.Buttherewerealotofthingsthatdidverywellforusintheconsumerbusinessinthebackhalfoftheyear,sothat'sonethingIthinkeveryoneshouldkeepinmind.
Clearly,whenyouhaveabigramplikewedidinthefourthquarterandwetelegraphadecentsequentialdeclineinthefirstquarter,thatwouldindicatesomethingisgoingon.AndIthinkit'ssafetoassumethatthereprobablywasinventorythatbuiltinthefourthquarterforreasonsthatarespecifictothosecustomersandhowtheywanttomanagetheirsupplychainsandsoforth.
ButIdon'tthinkitwasanythingoutoftheordinary.Ithinkit'srelativelytypicalforhowthosecustomersmanagetheirinventory.
Andasisthefirstquarterdecline,whichIthinkstartstodigestthatinventory.Idon'tknowhowlongittakesforthatwholethingtosmoothout,aconsumerbusinessofthissize,particularlydrivenoffofportablesisabitdifferentforusthanwehavehistoricallyhadapositionin.Sowe'llhavetoseehowitgoes.
Butmyguessisthatitpicksbackupinthethirdandfourthquarter,anddoesquitewell.Andallofthatstuffwillmakesensetoallofyouguysthattrytobackintoendconsumptionandsoforth.
JohnPitzer (Analyst-CreditSuisse):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page10of24
Helpful,guys.Thankyou.
Operator :
YournextquestioncomesfromCraigElliswithB.Riley.
CraigEllis (Analyst-B.Riley&Co.):
Thanksfortakingthequestion,guys,andcongratulationsonthestrongresults.Dave,onthegrossmarginoutlookwiththesequentialdecrease.Canyoujustframeupsomeofthegivesandtakes?
Becauseitwouldseemlikemixwouldbeatailwindtogrossmargin,butvolumelookslikeaheadwind.Whatwasutilizationinthequarter,andwheredoyouthinkitisintheoutlook?AndwhatdoesyourabilitytocontrolinventorymeanforthegrossmargintrajectoryaswelookouttotheAprilquarterandbeyond?Thankyou.
DaveZinsner (CFO):
Yes,soIthinkItalkedaboututilizationwasin--helpmeoutAli.
AliHusain (Treasurer&DirectorofIR):
Utilizationwasinthemid%s,butwe'rebringingitdowntoabout%inthefirstquarter.
DaveZinsner (CFO):
Right.Sothatobviouslywilldrivemostofthegrossmargindecline.Thereisabitofmixalso,asyoupointout,thatisdrivingalittlebitofthegrossmargins.
Iwouldsaythatthemixdecline,fourthquartertofirstquarter,hasalittlebitmoretodowith,believeitornot,mixwithintheindustrialspace,notmixwithinourbroaderbusinesscategories.Sothat'swhatwilldrivethegrossmargins.
Afterthat,obviouslywe'dexpecttobebringingbackourutilization.Hopefullyseasonally,weseeastrongindustrialrampinthesecondquarterandthatwouldcertainlydrivebettervolumewithinthefactoriesandshouldgetthegrossmarginsbackuptothelevelsthatweseetoday.
AliHusain (Treasurer&DirectorofIR):
OurindustrialbusinesstodayCraigisaboutoddpercentoffofitsrevenuepeakthatweachievedbackinsortofthethirdquarterofsoIthinkourgoalhereistoreallygettheinventoriesingoodshapewhichwearetryingtodointheFirstQuarterwithprettylowutilizationrates,preciselyforthatreason.TogetinventoriesingoodshapeforwhatwehopewillbeaseasonalSecondQuarterobviouslytooearlytocallthatatthisstagebutifwedoseeseasonalityintheSecondQuarterthenindustrialdoesbetterandweshouldseeprettygoodgrossmarginanddropthroughtotheearningssohopethatanswersthequestionandlet'sgettothenextcaller.
Operator :
OurnextquestioncomesfromToreSvanbergwithStifelNicolaus.
T oreSvanberg (Analyst-StifelNicolaus):
Yes,thankyou,greatresults.
Soyourbacklogisup%.IsthereanythingthatIcanreadintowiththatnumberandI'mthinking
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
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especiallysinceyourbacklogisobviouslyforseveralmonthsfurtheroutaswesortoftaketheconsumeroutofthatequation,doesthatnumbersortofsignalthatyourindustrialandcommunicationsbusinessisstrengthening?
DaveZinsner (CFO):
WellIthinkmostofitisIthinkatthemidpointofourguidancewe'relookingat%year-over-year,becauseifI'mnotmistaken,thebacklogthatyou'retalkingaboutintheKisacomparisonofthebacklogcomingintolastyearversusthebacklogcomingintothisyearandwearepredictingrevenuetobeup%soit'snotsurprisingthatbacklogwouldbeup.TheotherthingisIthinkinsomecases,theconsumerbusinesswhichwillbeupyear-over-yearprobablyprettymeaningfullygivesusalittlebitmorevisibilitythansomeoftheotherMarketsandsofromamixperspectivethatactuallyhelpsonthevisibilityintermsofbacklogbutitreallyisn'textendingthevisibilityatall.It'sstillallshippablewithinthequarterandforthemostpartandreallydoesn'tinfluencehowwewouldthinkthattheSecondQuarterwouldpanout.
AliHusain (Treasurer&DirectorofIR):
Letmejustgiveyoualittlebitofcoloryoumentionedspecificallyindustrialandcommunicationsinfrastructuresoletmegiveyoualittlebitofcoloraroundthebookingsinthequarter.Forindustrial,wesawAugustquiteweakasitgenerallyisseasonallyinthatmonth.Septemberwasactuallyquitestablewhichisabitofananomalyintheindustrialbusiness.GenerallyspeakingSeptembercomesbackquitenicelyandthistimearoundwasstabletoAugustlevelsandIthinkifyourememberbacktherewasprettyscreamingmacroheadlinesatthatpointintime.
Interestinglythen,theOctobermonthwasactuallyquitestrongfortheindustrialbusinessandNovemberseemstohaveleveledoffalittlebitandIthinkwe'refeelingprettygoodabouttheenvironmentgenerallythinkingaboutaprettyseasonalsortofenvironmentfortheFirstQuarterforindustrial.Wehaven'tmentionedityetbuttheweeksofinventoryindistributionweresevenandahalfweeksconsistentwiththepriorquarter.
Ourdeferredgrossrevenuebalancewhichwasaprettygoodproxyforinventoryinthechannelofrevenue;dollarswasdown%inthequarter.SoIthinkit'sallsortofhangingtogetherthereasfaraswecantellforthenextquarterandthatdefinitelyisinourguidance.Onthecommunicationsinfrastructuresideitwasup%sequentiallythisquarterintermsofrevenue.
Wirelinewasdownsomewhatsoinitlyindicationwasthatwirelessactuallydidbetterthanthe%whichitinfactdidandmostofthatwetoldyoulastquarterwefeltlikewewereundershippingindemandinthatspacealotofthatintermsofrevenueperformancewasaresultofinventorycomingbackinlinewithdemandyou'restartingtoseegoodbasestationdeploymentactivityalthoughit'sobviouslyearlytocallbutintermsoftheorderflowsandcolumnsduringthequarter,weactuallysawbetterorderfloweverymonthofthequarterinthecompsspacesothat'swhereweareat.Ihopethatansweredthequestionandlet'sgettoournextcaller.
T oreSvanberg (Analyst-StifelNicolaus):
Veryhelpful,thankyou.
AliHusain (Treasurer&DirectorofIR):
Great.
Operator :
OurnextquestionisfromCraigHettenbachwithMorganStanley.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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CraigHettenbach (Analyst-MorganStanley):
Yesthanks.Ijustwantedtodiscussyourapproachtocapitalallocation.IfIlookyou'vehadahealthymixcertainlyafocusondividendincreases,opportunisticM&A.OntheM&Afrontespeciallyastheindustryconsolidatesjusthowyouapproachthatrelativetothereturnofcashandanytypeofmetricsyou'remostfocusedon.
DaveZinsner (CFO):
Thanks,Craig.Soobviouslywearefocusedonthedividendandwementionedinthepreparedremarkswewithwouldliketoseethatcontinuallyincreasesandwewouldlikeincreasesinthelastyearssowedo,doopportunisticbuybacks.Wethinksomeofourshareholdersdofavorthebuybackoratleastappreciatethebuybackandsowehavemaintainedarelativelyconsistentapproach.ItdoesintendtobuybackmorewhenthestockisweakerwhichIthinkisprovidesagoodreturnoninvestmentfortheshareholdersandlastlyasyoupointoutCraigwedohaveanM&Aapproach.
WehaveaveryhighbarintermsofM&A.Wedon'twecertainlydon'tlookorkickthetiresonalotofdealswepicktheonesthatareveryhighquailanditreallystartswithcompaniesthathaveahighdegreeofinnovationandwherethatinnovationisIguesscomplimentarytoourowntechnologywithourexistingcustomerbase,andsoyouknowwewilldodealsfromtimetotime.Theygenerallywillbeinthehit-Itekindofsizerangeorprobablylowerinsomecases.We'reactivelylookingatthings.
Whenyoulookortendtolookatbusinessesthatdohaveahighdegreeofinnovation,itusuallycomeswithreallygoodgrossmargins,verygoodoperatingmargins,verygoodreturnonR&Dinvestmentssofromafinancialperspectivethosearesomewhatoftheoutputsasopposedtotheinputsbutthosedotendtogohandinglovewithreallyinnovativecompanies.
CraigHettenbach (Analyst-MorganStanley):
Gotit.Thanksforthecolor,Dave.
DaveZinsner (CFO):
Sure.
Operator :
OurnextquestioncomesfromAmitDaryananiwithRBC.
AmitDaryanani(Analyst-RBC):
Thanksalotfortakingmyquestionguys.IguessoneofthebiggestthingsthatpeopletendtotalkaboutyourecentlywasjusttheconcentrationissuewithyourlargestcustomeratthispointsomaybeifyoucouldjusttalkaboutthesolutionortheproducttoseehowyourlargestcustomerthepotentialtoexpandthatintoothersolutionsintootherVectorsbethatconsumerdifferentsectorsandwouldyoueverlookatM&Aasawaytodiversifyconservation?
AliHusain (Treasurer&DirectorofIR):
Actually,we'veneverbeenmorediversifiedasaCompany.Wehavemoreproductsintheportfoliothanwe'veeverhad.Weaddressmorecustomersthanwe'veeveraddressed.ThereactuallyisaCompanyinveryverygoodpositiononthatfront.
Withregardtotheconsumermarketingeneralwehaveverystrongleveragefromourcoretechnologyplatforms,intheconsumerbusinessittendstobemoreofaprecisiondevelopmentProductDevelopment
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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effortsowegetverystrongleverageforexample,fromourindustrialproductbasewhichtendstobeprecisionorientedinherentlysowe'relookingalwaysforareasinnovationcomesfirstforus,webuildthecoretechnologybringittoasmanyapplicationsaswepossiblycanandintheconsumerareawe'repickingouttheveryveryhighestlevelchallengesthatwecanpossiblyaddressandwebelievethoseproblemsaresusunableovertime.
Ofcoursetimewilltellwhetherthat'swellfoundedornotbutwebelievewe'reinavery,verygoodpositionandasDavementionedearlier,evenwithineachcustomer,welookfordiversificationofapplicationsandproductsandtechnologyandthatisthecasewe'replayingeverywhereintheconsumerareaaswell.
DaveZinsner (CFO):
I'djustadd-ontheM&Afrontwedon'tdrivethatoffadiversificationapproachbecausewe'reconcentratedwithonecustomer.Wedopickusuallycompaniesthathavealotofdiversityandbyvirtueofthatwedogetalotofdiversitybutourfirstandforemostobjectiveistofindreallygreattechnologythatcomplimentsourexistingtechnology
AmitDaryanani(Analyst-RBC):
Perfectthanksandcongratsonthequarterguys.
DaveZinsner (CFO):
Thankyou.
Operator :
OurnextquestioncomesfromChrisCasowithSusquehannaFinancial.
ChrisCaso (Analyst-SusquehannaFinancial):
Yesthankyougoodmorning.
Questiononthecompsspaceandsomeofyourfollow-uponsomeofyourcommentsthere.Iguessparticularlywithinthewirelesspartofthatspace,doyouthinktheexcessinventorywithinthatspacehasbeendigestedatthispointsothatgoingforwardthegrowthinthatsegmentshouldbeproportionaltothegrowthinbasestationdeployamsandobviouslyunderstandthosebasestationdeployamsarewellbelowtheirpeerpeak.
AliHusain (Treasurer&DirectorofIR):
Christhanksforthequestion.
Youknowobviously,neversaynever,right?It'salumpymarketforareasonbutoursensewhenwelookattheorderflowswhenwetalktoourcustomersisthatthatperiodoftimewheretheinventoriesweremassivelydrawndownisbehindussoobviouslywecan'tspeakforothercompanies.Andothersuppliersbutwhatwecantellforourproduct,whatwe'reshippingintothespaceatthecurrentmomentisprettywellbalancedwithindemandinthisspaceandfranklywhenwelookedattheorderflowsandthinkingabouttheguidancefortheFirstQuarter;generallyspeakingtheFirstQuarterisdowninsortofhighsingledigitssequentiallyforthecalmspaceandthistimeifyoubackintoguideandwe'reimplyingitwillbefairlystable.
Soifyoulookattheregionalperspective,NorthAmericahasbeenprettystable.ChinanowhasstartedtodeployTDNFD,againit'sslowbutithasstartedsowesawsomeimpactandgoodbenefitforthatinour
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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quarter.AndifyoulookatemergingregionstheycontinuetodeploywithparticularlyagoodquarterinIndia.SoIthinkthingsaremovingandslowandsteadybutatleasttheyaregoingintherightdirection.
ChrisCaso (Analyst-SusquehannaFinancial):
Thankyou.
AliHusain (Treasurer&DirectorofIR):
Sure.
Operator :
OurnextquestionisfromWilliamSteinwithSunTrust.
WilliamStein (Analyst-SunTrust):
Thankyoufortakingmyquestion.
Vince,youhighlightedwhatsoundslikewhatcouldbesortofavirtueuscyclebetweenyourCOMinfrastructuremarketononehandandtheotherthreeendMarketsandIguessitsortofraisesaquestionastowhichoftheseyouexpecttogrowfastestasyouenterthisenvironmentorthisthenyoudescribedasthethirdwave.AndIalsowonderwhetherconsolidationplaysintothatthinkingandwhetherM&Asortofplaysintothethinkingofwheretopositionrelativetothecycleofdatadevelopment?
VincentRoche (CEO):
Greatquestion.Sowehavealongtermmodel.ForgrowthwebelievetheMarketsthatifyoulikeleveragemostintermsofdrivinggrowthareattheupperendoftwotothreetimesGDPmodeltheautomotiveandcommunicationsinfrastructureareasandIstillbelievethattobetrue.WeputouttargetsatleastattheAnalystdayandIthinkthosetargetsarestillvalidthere.Obviouslyconsumerisgoingtobeattheupperendofthataswell.
IthinkifwecanoverthelongtermandwehavecertainlyforthelastthreeyearsbeenabletodriveourindustrialbusinessatacoupleoftimesGDPlevel,wewouldbeinveryverygoodSteadwellintothefutureandwhatI'vegivenyouintermsofthosetargetsisreallyaboutwhatwedoorganicallyratherthanwhetherwehavetobuymoreHeft.
AsDavehasindicated,we'realwayslookingfortechnologiesthatmakemoreofanimpacttotheoverallsolutionwedelivertoourcustomersandwe'retakingmoreofastrategicviewratherthanafinancialoroperatingviewofM&Asoit'smoreaboutfindingthoseboltintechnologiesthatmakeADImorerelevantandmakeourtechnologyproductofferingmorepowerfulintheeyesofthecustomerbutgenerallyspeakingwe'reinavery,verygoodpositiontoorganicallytakecareofourfuture.
WilliamSteinThankyou.
VincentRoche (CEO):
ThanksWill.Nextquestionplease.
Operator :
OurnextquestioncomesfromDavidWongwithWellsFargo.
DavidWong (Analyst-WellsFargo):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Thanksverymuch.Whenwelookatyourindustrialandcommunicationssegmentsandyear-over-yearcomparison,dothesenumbersreflecttheendMarketsoraretheysuppressedbyrationalizationofproductorcustomertransactionfollowingthehit-Iteacquisition?
DaveZinsner (CFO):
Wellobviously,intheFirstQuarterof,wehadhit-Ite,soit'sadirectcomparisonsoIguessinthecommunicationsbusiness,wearecertainlyoperatingatwhatisalowerlevelthanwhatwethinkisthenormalbuildoutofbasestationsonayearonyearbasissoit'simpactedbythereductioninspendinginwe'relessinfrastructureinacoupledifferentMarkets.
Granteditsrecoveredfromitstroughbutnotcertainlywhatwouldbeconsiderednormalizedlevels.Ithinkintheindustrialbusiness,itwasarelativelyonayear-over-yearbasisarelativelymodestbutkindofwithinwhatGDPlikegrowthratehasbeensoIwouldsaythatprobablyreflectskindofnormalindemandinthatmarket.
VincentRoche (CEO):
Iwillsayjusttoaddalittlemorecolor.Wehadarecordquarterwithregardtothehit-iteportfolioinquarterjustdoneandgivenarelativelydepressedcommunicationsmarketthoughtherewassomerecovery,whatI'vebeenmostpleasedaboutisthediversityoftheapplicationswe'reabletotargetoutsideofthecommunicationsinfrastructurebusinesswiththatportfolio.
DavidWong (Analyst-WellsFargo):
Great,thanks.
DaveZinsner (CFO):
ThanksDavid
Operator :
OurnextquestionisfromHarlanSurwithJPMorgan.
HarlanSur (Analyst-JPMorgan):
Higoodmorning.Thanksandcongratulationsonthesolidquarterlyexecution.
IthinkAlisaidinthepreparedremarksthattheCAGRhadhasbeengrowingabout%overthepastfewyearsprettysolidperformance.That'sdeceleratedabittoflatgrowthyearinfiscal.LookslikegiventheguidancearoundQthat'sprobablygoingtobeflatyear-over-year,theteamhastalkedaboutabetterdesignwinintermsofdollarsconstantcaptureinwithintheautomotivesegment.
SoIguessthequestionisistheteamstillrelativelyconfidentaboutthepotentialforreaccelerationinautomotiveandthenwithsubsegmentsareyougoingtoseemoreofthegrowthisitinpowertrainandsafety,growthIndianatotapementaswell?Thankyou.
AliHusain (Treasurer&DirectorofIR):
Yeahgoodquestion.
Sowe'vehadalotofinquiriesoverthelastcouplequartersaboutourperformancespecificallyintheautomotivesectorandwhatI'lltellyouisit'sreallyaTaleoftwobusinessesduring.ItwasarelativelyflatquarterandwhenyouextractIthinkI'vementionedbeforetoyouthatourmen'ssafetybusinesshashadsomenopunintendedsomespeedbumpsalongthewayhere.Andourautomotivebusiness,withthe
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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exceptionofmen'ssafetyactuallygrewinthehighsingledigitsyear-over-yearprimarilyintheareaslikeadvanceddriverassistance,thepredictivesafetysideofthebusinesshasgrownatastellarpacefortheCompanyoverthelastthreeorfouryears.
Ibelievethatwillbethecaseintothefutureandthepowertrainspecifically,thesensingpartofthatbusinessandthebatterymonitoringcontrolhasdonewellandwillcontinuetodowell.Infotainmentisaverydiverseareaandwetendtotargetthehighendofthatbusinesswithourdigitalsignalprocessingandourdataacquisitiontechnologyandalgorithmictechnologies.WehaveanewtechnologycalledAtoBwhichisamethodofmovingsoundthroughthecaressentially,speechandsoundinawaythatisveryefficient,veryverylowlatency,verylowweightintermsofthewiringcablesandsoon.
Andwehavealotofnewsensingtechnologycomingintoplay,anarealikeAMR,forexample,wherewearedevelopingaleadershippositionwhichwillbeawholenewcategoryinthatbusinessinthefutureascarsEelectricFridayandbecomemoreautomated.SoIthinkwhatyoucanexpectintheautomotivebusinessduringthiscomingFiscalYearisthatthefirsthalfwillbewithinseasonalpatternofthecurrentbusinesslevelbutthesecondhalfIdoexpecttopickupinthegrowthoftheoverallbusinessatthehigherendofthegrowthmodelwhichisthreetimesGDPkindoflevels.
Sowe'reconfidentgiventhealignmentbetweentheproductswehaveandcustomerprogramsthatwe'vegotandit'sanareawherewehavebeenintensivelyinvestingandincreasingtheinvestmentsoverthepastfiveyears.SoIthinkwe'llreturntoagrowthpatterntowardsthebackendofandbeyondsothat'smysensebasedoneverythingthatIknowatthispointintime.
HarlanSur (Analyst-JPMorgan):
Great,thankyouverymuchfortheinsights.
AliHusain (Treasurer&DirectorofIR):
Sure.
Operator :
OurnextquestioncomesfromVivekAryawithBancofAmericaMerillLynch.
VivekArya(Analyst-BofaMerillLynch):
Thankyoufortakingmyquestionandcongratulationsonthegoodresultsandexecution.
AliHusain (Treasurer&DirectorofIR):
Thankyou.
VivekArya(Analyst-BofaMerillLynch):
Ijustwantedtoclarifyonthisoverbuildversusunderbuildinconsumersowedon'tblowitoutofproportion.
SoDaveonQ,youmentionedsomeslightoverbuild.Isitpossibletoquantifythat?AndthenaswethenlookatQ,Iassumethatit'sperhapsanunderbuild.SoasyouemergefromQareyougoingtoemergewithsomesignsofshippingintoactualdemandandIknowthatit'sprobablyalittleearlybuthowdoesroughvisibilitylooklikeforQ?
Thankyou.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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DaveZinsner (CFO):
Wehave,likeIsaidwe'vegotlittlevisibilityintoQanditwouldbeprematureformetoevenmentionwhichdirectionitwouldevengo.Yes,Idon'twanttoandIthinkyou'veactuallypointoutagoodpoint.Idon'twanttooveremphasizebuild.
MostofthatwebelievemostofthatshipmentswereconsumedbutwhenyouhaveaforthquartertoFirstQuartertransitionlikewe'retalkingabout,youhavetobelievethatthere'ssomekindofdigestionthathappensforalittlebitofit,whichdrivesustobelievethatonasequentialbasisconsumerisgoingtobedownandthat'swhywe'reguidingtowherewe'reguidinganditwillprobablybedownmorethanthecorporateaverage.
Outsideofthat,Ican'tgiveanymorevisibility.Obviouslythere'salotofmovingpieceswithintheconsumerbusinessandtryingtoidentifyeveryapplicationandeverycustomergoingintoandfiguringoutwhattheyarealldoingisnexttoimpossibleforus.Wegettheorders,weshipthemandweleaveittothemtofigureoutwhattodobeyondthat.
AliHusain (Treasurer&DirectorofIR):
It'sprobablyagoodtimetoreemphasizedespitealltheneartermnoisethatyear-over-yearrevenuegrowthintheFirstQuarterwouldbe%withdoubledigitEPSgrowthsothanksforthequestionVivek.
We'llgettoournextcaller.
Operator :
OurnextquestionisfromSteveSmigiewithRaymondJames.
SteveSmigie (Analyst-RaymondJames):
Thanksalotguys.
Justaquickfollow-upontheoutperformanceinthequarter.Ithinkyoumentionedthatitwasduetomultipleproductsthereinconsumer.Obviouslyjustadiscussionofforcetouch.Canyoutalkaboutwhatproductsotherthanforcetouchwerepartoftheoutperformanceinthequarter?
DaveZinsner (CFO):
I'mnotevensayingthatwasareasonoftheoutperformanceinthequarter.
AllIcansay,Steve.wehaveseveralmanycustomerswithinourconsumerbusiness.Wehavelotsofcustomersintheportablesideofthebusinessandwehavealotofdifferentproductsthatgointothoseapplications.
VincentRoche (CEO):
Togiveyouasense,weagaintheproductsweshipintotheseapplicationstendtobeprecisionorientedinareaslikesensingandinaudio,andalsointheareaofimageprocessingsotherearekindofthethreecategoriesyoushouldthinkaboutwhenyouthinkofADI'spositionwithintheseportableconsumerapplications.
SteveSmigie (Analyst-RaymondJames):
Okay,great,thankyou.
AliHusain (Treasurer&DirectorofIR):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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ThanksSteven.
ThisisAlihere,itsays,we'rethreeminutesshortofthehour.Ithinkwe'llkeepgoingwiththequestionsbutthetimeisprobablyoverforthosewhohavere-queuedunfortunately.SoIthinklet'skeepgoingtoatleastgeteverybody'sfirstquestionsin.
We'llgettoournextcaller.
Operator :
OurnextquestionisfromC.J.MusewithEvercoreISI.
C.J.Muse (Analyst-EvercoreISI):
Goodmorningthanksforsqueezingmein.
Overalllookingforyourkindofbigpicturemacroviewhere,whatareyourthoughtsintermsofwhereweareinthecycle?Wheredoyouseepocketsofhealth/weaknessandspeakinggeographicallyandhowallofthatshapesupintermsoftherecoverypictureinthefirsthalfof?
AliHusain (Treasurer&DirectorofIR):
YesI'mnotsurethereisacycleanymoreinthesemiconductorindustryandIthinkalotoftheconsolidationsomewhatinsuresthataswell.SoIthinkthere'sadecentmatchbetweensupplyanddemandrightatthispointintime.
Overtheyears,we'vealldevelopedmethodstodealwiththevolatilityandwehavealotmoretransparencynowintotheareasofsupplyanddemand.SoIthinkinsomewayswhatyoushouldbelookingatforisprobablywhatthemacroeconomicclimatedoesandwe'vestartedmessagingourgrowthtrajectoryorthealgorithmwehaveforgrowthaswellonthatbasis.SomemultiplegiventhevariousMarketsthatinwhichweplayandwhattheyarecapableofdeliveringintermsofmacrolevelgrowthandmodulatedbywherewearewithourproductsandtechnologiesanourcustomersintheseareas.
SoI'mnotsurethereisacycleinourindustryanymore.It'sprobablysafertolookatwhatthemacroenvironmentdoesinthevariousregions.
DaveZinsner (CFO):
Thanks,CJ.Let'sgettoournextcaller?
Operator :
OurnextquestioncomesfromTristanGerrawithRobertW.Baird.
T ristanGerra(Analyst-RobertW.Baird):
Tofollow-uponyourcommentaryaboutautomotive,whattypeofmarketsharepositiondoyouthinkyoucanhaveindriverassistoverthenextcoupleofyearsandonthebasisofyourdesignwinsandhowbigdoesitgetasapercentofyourautomotivemarket?
VincentRoche (CEO):
Yes,soit'sagoodquestion,Tristan.OffthetopofmyheadIdon'thavethenumbersbutthegrowthrateofouradvanceddriverassistancebusinesshasbeenoneofthestrongestprobablythestrongestgrowthelementbythewayduringcan.It'sameaningfulpartofADI'soverallautomotivebusinessmodeatthispointintime.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Wehavesomeveryexcitingnewtechnologybuiltonsomemicrowavetechnologythatwebuiltonourvery,veryadvancedtechnologyplatformthatweareabouttowillbesamplingoverthiscomingyeartoourcustomersthatwillchangethegameinradartechnologies.AndsoIthinkwhenyoulookatthatbusinessoverall,certainlysafetyisgoingtocontinuetobeaveryimportantpartgiventhemandatesandeverybodywantsmoresafety.
SoandIthinkthecapabilitiesthatwehaveastheCompanyaswellinactive,passiveandcombiningthosewithpredictiveputsusinquiteauniquepositionactuallytobeabletolookatthesafetyproblemasasystemofproblemsandtailoroursolutionstothoseneeds.
T ristanGerra(Analyst-RobertW.Baird):
Great,thankyou.
Operator :
OurnextquestioncomesfromAmbrishSrivastavawithBMO.
AmbrishSrivastava(Analyst-BMO):
Hithankyou.
DaveIhadaquestiononCapExguidanceforthefullyear.Andalsoalongthoselines,FreeCashFlowmargingiventhatahigherROIandhigheroperatingmarginbusinessisyourportionofthemix.ShouldweexpectthatFreeCashFlowmarginforfiscalshouldbehigher?Thankyou.
DaveZinsner (CFO):
Yes,we'recertainlydrivingtheFreeCashFlowtobehigher.
ThatisourgoalandthentheportionontheCapEx,we'redrivingtowards%orsoCapExasapercentofrevenue.That'sreallyourgoal.IthinkwehadaverygoodyearintermsofFreeCashFlowthisyear.
IthinkwecandobetternextyearwithalowerCapExasapercentofrevenuetohelpdrivethatalittlebitandthere'ssomethingswedidhavetobuildinventorythisyearupforsomerampsthatoccurredandsomelasttimebuildsrelatedtohit-Ite.ThoseactivitiesarebehindusintermsofbuildinginventorysoweshouldgetaprettyfavorableworkingcapitalnumberforwhichcouldhelpdriveabetterFreeCashFlownumberforaswell.
AliHusain (Treasurer&DirectorofIR):
YesandifIcanjustaddquickly.
FreeCashFlowfortheyearexcludingtheone-timepensionpaymentwas%ofrevenue.Themodelrangeis-%soIthinkwe'rewithinthatrangebutcertainlytowardsthelowerendoftherange.Andyouknowwithinthequarterwegeneratedexthatpayment%ofoursalesinFreeCashFlowwhichisactuallyvery,verystrongandasyouknowwereturn%ofeverythingwegeneratetoshareholdersthroughdividendorbuybacksothanksforthequestion.
Nextcaller.
Operator :
OurnextquestioncomesfromHarshKumarwithStephens.
HarshKumar (Analyst-Stephens):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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Greatresults,greatguidance.
Letmejustaskquicklyaboutwirelessinfrastructure.It'squiteabitoffthepeakthatyouguyshitIthinkintheJanuarypartofthisyear.You'retalkingaboutprettygoodtrendshappeningrightnowasyouseeitinwirelessinfrastructure.WhatisyourbestviewofhowtheenvironmentslookingasyougetintonextyearandmaybealsoforCom?
VincentRoche (CEO):
Yes,wellasAlisaidearlierfromageographicalperspective,youknowNorthAmericawasprettyflat.IthinkthestoryintermsofdemandhasbeendrivenbyChinaoverthecourseofFY,thegovernmentcarrierinvestigationshavehadahugeimpactonthedeploymentofinfrastructurethere,soIthinkthepacewillpickupinthe,we'veseensomepickupoverthelastquarter.
DemandhassolidifiedandstrengthenedbutIthinkduringyouwillseeapickupintheFDdeployments.FDD,TD,andparticularlyintheareaofwithregardtoChinaMobile.SmallcelldeploymentinthesecondhalfoftheyeartodenseitFridaythenetworkandgetmorecapacity.AndmysenseisthatGwe'veseenforexample,inIndiaoverthepastquartersomegooddeploymentsinanareawherethedeploymentofLTEisreallyreallylowandhasalongwaytogo.AndIthinkitwillbesteadyinAmericaandprobablygrowmargininEuropeascarriersdeploymoreinfrastructuretheretocatchthenetworksupfromalotofplacesstillpoindgintoG.
DaveZinsner (CFO):
HarshIthinkit'saquestionofwhen,notifandIthinkwe'reverywellpositionedacrossallthecarriersandalloftheregionssoinventorieslooktobeingoodshapetotheorders.Hopefullywe'llholdup.AsyoumentionedourComsbusinessiswelloffitspeaksandIlookbackit'sabout%offitsrecentrevenuepeaksoIthinkthere'splentymoretogoandaquestionofwhennotifsothanksforthequestion.
HarshKumar (Analyst-Stephens):
Thankyouguys.
Operator :
OurnextquestionisfromRossSeymorewithDeutscheBank.
RossSeymore (Analyst-DeutscheBank):
ThanksforSneakingmeinandcongratulationsonthestrongquarter.
Hadaquestiononthecashflowandcapitalallocationside.Youguyshavedoneagreatjobreturningcashlikeyousaidabout%ofFreeCashFlowinthelastyearbutthat'scomesomewhatattheexpenseofdomesticcashwhichlookslikeit'sdownabout-%year-over-year,soIguessmyquestioniswhenyouguyshavethedomesticversusoffshorecash,howdoyoureconcilethatwithbothyourcashreturntoshareholderswhetherit'srepurchaseordividend,andhowdoesthatimpactyourM&Astrategyifatallacknowledgingyouwereabletouseoffshorecashforhit-ite?
DaveZinsner (CFO):
It'sacomplicatedwebnodoubtaboutit.Ithinkingeneral,ifwearereturning%ofourFreeCashFlowbacktoshareholders,wedon'tgenerateatthatlevelintheUSandobviously,allofthathastocomefromUScashflows.SotheUSentitydefinitelywillbeaborrowerandthat'swhywehave$billionofcashand$millionofdebttodayisbecauseweleveruptheUSbalancesheetbutonanetbasiswestillhaveanetcashpositionworldwideandIthinkthat'sgenerallytheapproach.
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page21of24
Therearesituationsinwhichinternationalcashwouldbeutilizedandasyoupointoutoneofthosewouldbeforacquisitionsandthere'salsoanumberofthingsthatwecouldpotentiallydooutsideoftheUSintermsofacquisitionsthatit'snotaverycomplicatedtransactiontoutilizethatcash,sowewillusesomeofthatcashobviouslyforM&AbuttotheextentweneedUScash,wewillusetheleveragetogetthere.
AliHusain (Treasurer&DirectorofIR):
AndRosswehaveoverallliquiditydomesticallyof.-$.billionwhichobviouslyincludestherevolveraswellbutthatgivesusplentyofflexibilitytodothethingswewanttodohereintheUSsothanksforthequestion.
Operator :
OurnextquestionisfromBlayneCurtiswithBarclays.
Unidentif iedPart icipant :
Thanksverymuchfortakingthequestion.ThisisChrisonforblain.Andcongratsonthestrongquarterandguidance.
AliHusain (Treasurer&DirectorofIR):
Thankyou.
Unidentif iedPart icipant :
Ifeelabitlikeit'sbeatingadeadhorseherebutIwanttodrillinontheconsumerbusinessandifyoucanjusttalkaboutlinearityoverthelastcouplequartersforthecorebusinessarea.You'veobviouslyhadabigrampinthewirelessspacebutjusttheexistingbusinessoutsideofthatbigramphowhasthattrendedoverthepastcoupleofquarters?
DaveZinsner (CFO):
Yes,Ithinklet'sjustlookatthelastquarterhere.Overall,I'dsayordersexcludingtheconsumerbusinessinAugustweredownfromthepriorquarter.TheywereslightlyupinSeptemberandOctoberwasverystrongasImentionedearlierparticularlyintheindustrialspacecomingoffoftheweakerSeptembersothatgenerallyishowitstrendedandIthinkwe'vegiventheguidanceherefortheFirstQuarterbasedonwhatwe'reseeingintheorderflowssoIthinkifyouexcludetheconsumerbusinessgenerallyeverythingelseistrendingseasonallyintheFirstQuarter.
Sothanksforthequestionandwe'llgettothenextcaller.
Operator :
OurnextquestionisfromDougFreedmanwithSternAgee.
DougFreedman (Analyst-SternAgee):
Greatthanksfortakingmyquestionsandsqueezingmeinguys.realquickly,lookingatgrossmarginscanyougiveusasensetotherangethatwewouldseebetweentheindustrialconsumerautoandComsgroups?Iknowyou'vementionedthattheindustrialiscontributingtoalittlebitoftheheadwindbecauseitissoftintheguidance,butIwouldhavethoughttheconsumerbeingbelowaveragewouldhavealsobeenalittlebitofanoffsetmaybeifyoucouldhelpmejustmagnifytherangethatwewouldseeacrossthebusinessessowehaveabetterunderstandinggoingforward?
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page22of24
Thanks.
DaveZinsner (CFO):
Yes,I'llseeifIcangiveyouanycolor.
Theindustrialbusinessobviouslyisourhighestgrossmarginbusinessandthatisabovethecorporateaverage.Communicationsisslightlyabovethecorporateaverage.Consumerisslightlybelowthecorporateaverageandautomotiveisslightlybelowthecorporateaveragesothosearekindoftheranges.TheonlychallengeinthatDougisthatthere'salsothedynamicofwhatgetsmadeinthefactoryandsosometimesmixdoesplayapartinkindoffactoryabsorptionandhowmanywafersweproduceandsoforthsothat'sacomplicatingfactorthatdrivesalittlebitofthegrossmargin.
ButIwouldjusttellyoumaybesteppingbackfromit,wehadaverygoodyearintermsofgrossmarginsforwewere%andwethinkthatwhilefocusingoninnovationwegenerallywillgetverygoodgrossmarginsinthefuture.We'vegotsomethingsthatwe'relookingatthatwecontinuetoexecuteonthathelplowerourcostsandimproveourpricing.InfactIthinkoverthelastfewyearsourASPshavebeengoingup,sowethinkwehaveaverygoodopportunitytopushthosegrossmarginshigheroverthenextfewyears.
DougFreedman (Analyst-SternAgee):
Great,thankssomuchandcongratsagain.
DaveZinsner (CFO):
Thanks,Doug.
Operator :
OurnextquestionisfromIanIngwithMKMPartners.
IanIng (Analyst-MKMPartners):
Yes,thanks,soobviouslyyou'readdressingalotofopportunitieshereandconvertersandamplifierswithgoodportfoliostherebutcouldyouremindusofyourviewonpowerManagement?Isthisanareayou'dliketogetintoperhapstoleverageyourscaleandcustomerfacingresourcesorisitnotinterestingatthismoment?
VincentRoche (CEO):
WellpowerManagementasatechnologyforus,wehavegoodtractioninareaslikecommunicationsinfrastructureandforuswearenottryingtobuildabroadbasedcatalogofproducts.WhatwearedoingistakingthecapabilitythatwehaveinsidetheCompanyintermsofprocess,technology,andintermsofcircuittechnologyandapplyingthattechnologytobuildproductsthatstrengthentheoverallsignalchainparticularlyinmorekindofverticalapplications;wherewecangettheleverageinareasasIsaidlikewirelesscommunicationsinfrastructure.
SothatisthestrategyfortheCompanyinpowerManagement.Andwe'vemadesomeveryverygoodprogressthereoverthelastthreeorfouryearsaswehavegivenupthegoalsintryingtobuildabroadcatalogandbrandingpowerbutinsteadtargetedveryverycarefullyattheapplicationswheretheinterplayofpowertechnologyandsignalchaintechnologycreatesavirtualcyclehere.
IanIng (Analyst-MKMPartners):
CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
©2014TheStreet,Inc.Al l R ightsReserved Page23of24
Thanks,Vincent.
Operator :
OurlastcallcomesfromStephenChinwithUBS.
StephenChin (Analyst-UBS):
Hithanksfortakingthequestion.
Justwantedtoaskafollow-uponautomotive.YougavegoodcolorearlieronsomeofthetrendsherebutjustfromageographicandmaybekindofmacrobiggerperspectivewasChinatheonlyareaofweaknessorwerethereanyothergeographiesthatshowedsoftnessinthequarterandinadditiontothatjustwhatpotentialforinterestratestoseeanincreaseinthecomingquarters,doyouthinkthehighercostoflendinginbacklogsofsalesaswell?
DaveZinsner (CFO):
Yes,Ithinkwe'renotaroomofeconomistshereforsure.
Butletusatleasttellyouwhatourthinkingis,Stephen.Sointhequarter,thebusinesstrendedreallyasweexpectedfrankly.Itwasup%sequentially.Allthethreesubsegmentsofautomotivewe'reessentiallyinloinandprettystableduringthequarter.WhenyoustartedtheyeartheforecastforvehiclegrowthinChinawas%andasweendtheyearit'sabout-%andChinaobviouslyconsumesagoodamountofpremiumvehicles.
ForADIwe'vedonethebackoftheenvelopemathhere.Onourrevenueintheautomotivespaceit'sprobablymidteensimpactfromsalesintoChinasocertainlythatwouldhaveanimpactonourrevenue.Ithinkwhenyoulookacrosstheotherregions,I'dsayNorthAmericahasbeendoingquitewell.TheEuropeanvehicleregistrationseverymonthareupsothat'sgenerallyagoodsign.
WhenyoulookatNorthAmericatheaverageageofthevehiclesisgreaterthanitshistoricalaverage.DealerinventoriesarebelowtheircorporateaverageandinChinatherecentlyannouncedstimulusprogramsaroundsalestypeswereautomotive.Soagain,I'mnotaneconomistandIdon'tplayoneonTVeitherbutfromoursenseeverythingissortoftrendingaswewouldhaveexpectedexceptI'dsayfortheChinaregionwhichyouknowcertainlyhasbeenweakerfortheentireindustry.Andsocertainly,we'renotgoingtobeagnostictothatthatwouldhaveanimpactonoursalesaswellparticularlyasChinaconsumesafairamountofpremiumvehicles.SoIhopethatansweredyourquestionandIguessthat'stheendofourearningscallhere.
We'reminutespastthehour.AsaremindturpitudeourFirstQuarterresultsarescheduledforFebruary.
Again.a.m.PressReleaseEasternTime,a.m.earningscall,sothanksforjoiningusthismorningwelookforwardtotalkingtoyousoon.
Operator :
Thisconcludestoday'sAnalogDevicesConferenceCall.
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CompanyName:AnalogDevicesIncCompanyTicker:ADISector:T echnologyIndustry:Electronics
EventDescription:Q42015EarningsCallMarketCapasofEventDate:18.64BPriceasofEventDate:60.76
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