Analog Devices Outlines Strong Strategic Vision and New Financial Model at 2022 Investor Day
- Actions Underway Include Driving Growth Through Customer Success and Moving Up the Technology Stack to Build and Empower the Intelligent Edge
- Reinforces High-Performance Broad Portfolio; Diverse Customers, Applications, and Markets; Customer-Centric Culture; and Resilient Hybrid Manufacturing Model
- Announces New Financial Model that Increases Revenue Growth Target to 7-10% CAGR and Adjusted Operating Margin Target to 42-50%
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“For more than half a century, we have stayed true to our ethos of solving our customers’ critical and complex problems, while building the most durable and premier analog, mixed signal, and power franchise. We have a tremendous opportunity ahead of us as we execute our long-term vision to build and empower the intelligent edge by bringing digital technologies and software closer to the edge, making it more intelligent and prescient,” said
In conjunction with today’s event, ADI announced its new long-term financial model, highlighting the following expectations:
Adjusted Gross margin
Floor of 70%
Adjusted Operating margin
Free cash flow margin2
Free cash flow return
Capital expenditures as a percent of revenue
1 A reconciliation of the non-GAAP financial measures included in this chart to the corresponding GAAP measures is not available without unreasonable effort. Refer to the Company’s 1Q22 press release available at investor.analog.com for historical adjustments from GAAP to Non-GAAP measures, which have been significant in prior periods.
2 Free cash flow (FCF) is equal to operating cash flow, less capital expenditures. FCF margin is FCF divided by revenue.
In addition, ADI also updated its synergy targets related to the acquisition of Maxim Integrated. The Company now expects to capture cost synergies of
The presentation materials and a replay of the event will be available at investor.analog.com.
Forward Looking Statements
This press release contains forward-looking statements, which address a variety of subjects including, for example, statements regarding expected financial goals and results, expected product development, product offerings and technical advances, growth opportunities and anticipated growth, market trends and opportunities, expected customer demand, targeted free cash flow returns and capital allocation strategy, and expected benefits and synergies of the acquisition of Maxim Integrated Products, Inc. (Maxim). Statements that are not historical facts, including statements about our beliefs, plans and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: the uncertainty as to the extent of the duration, scope and impacts of the COVID-19 pandemic; political and economic uncertainty, including any faltering in global economic conditions or the stability of credit and financial markets; erosion of consumer confidence and declines in customer spending; unavailability of raw materials, services, supplies or manufacturing capacity; changes in geographic, product or customer mix; changes in export classifications, import and export regulations or duties and tariffs; changes in our estimates of our expected tax rates based on current tax law; adverse results in litigation matters, including the potential for litigation related to the acquisition of Maxim; the risk that we will be unable to retain and hire key personnel; unanticipated difficulties or expenditures relating to integrating Maxim; uncertainty as to the long-term value of our common stock; the diversion of management time on integrating Maxim's business and operations; our ability to successfully integrate acquired businesses and technologies, including Maxim; and the risk that expected benefits, synergies and growth prospects of acquisitions, including our acquisition of Maxim, may not be fully achieved in a timely manner, or at all. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the
Vice President of Investor Relations and FP&A
Chief Communications Officer