Are Analog Chips Set for a Recovery? The Latest Earnings Signals from Texas Instruments and ADI

n February 27, 2025, at 13:37:00, the topic "Are Analog Chips Set for a Recovery? The Latest Earnings Signals from Texas Instruments and ADI" emerged.

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The latest quarterly financial reports of Texas Instruments and Analog Devices (ADI), two major players in the U.S. analog chip industry, have been released. Although the signals they sent out are different - Texas Instruments believes that inventory is still being digested and the subsequent market should be viewed with caution, while ADI is quite optimistic and claims that the channel inventory is already at a low level. However, both companies agree that the long - dormant consumer market is gradually recovering, and the Asian market is becoming more active, offsetting the weakness in the automotive and industrial markets.

Texas Instruments' Revenue Reaches $4 Billion, ADI's Reaches $2.4 Billion

Texas Instruments' revenue in the fourth quarter was $4.01 billion, a year - on - year decrease of approximately 2% and a sequential decline of 3%. Its net profit was $1.205 billion, a 12% year - on - year decrease. By business category, the revenue of the analog business in Q4 increased by 1.7% year - on - year to $3.17 billion, while the revenue of the embedded processing business decreased by 18% year - on - year to $613 million. The revenue of Texas Instruments' other departments increased by 7.3% year - on - year to $220 million.

ADI's revenue in the first fiscal quarter was $2.42 billion, slightly higher than the analysts' estimate of $2.36 billion. The net profit for the quarter was $391.3 million, with earnings per share of $0.78. By business category, the revenue in the industrial sector was $1.1 billion, a 10% year - on - year decrease; the automotive business revenue was $700 million, a 2% year - on - year decrease; the communication business revenue was $300 million, a 4% year - on - year decrease. The consumer goods business was the only business with revenue growth, with revenue exceeding $300 million, a 19% year - on - year increase.

Highlights of the Financial Reports: Asia, Consumer/AI

Texas Instruments pointed out that the Chinese market is one of its important markets. In the fourth quarter of 2024, Texas Instruments' revenue in the Chinese market increased both sequentially and year - on - year. The U.S. market also showed year - on - year growth, while the revenue in other regions declined significantly. Haviv Ilan, the CEO of Texas Instruments, said, "From the perspective of semiconductor application fields, the revenue growth in the Chinese market mainly comes from automotive and consumer semiconductors. The revenue growth of industrial semiconductors is relatively flat, similar to that in other regional markets."

Vincent Roche, the CEO of ADI, believes that ADI's performance has been growing in many Chinese markets, with the automotive business showing the most significant growth. The company has established long - term cooperation with many Chinese automotive brands, providing various analog chip products such as ADCs and power management chips.

ADI's consumer business has also witnessed remarkable growth. In the previous quarter, it increased by 19% year - on - year to $322.9 million, mainly driven by the gradual popularization of AI devices, high - end smartphones, and smart home products. Some analysts believe that ADI is expected to benefit from the emerging trends of automation such as robots and smart devices. The increasing market acceptance of hybrid and electric vehicles is also expected to boost the demand for analog ICs.

However, Texas Instruments and ADI have different views on the subsequent terminal market.
Texas Instruments, which released its financial report earlier, frankly stated that originally, the executives expected that some terminal markets showed signs of emerging from inventory overhang. But currently, the rebound speed has not met the expectations of some investors.

In contrast, ADI is full of confidence. Vincent Roche, ADI's CEO, pointed out that the current channel inventory is low, and the order situation has gradually improved over the past 18 months, indicating that the bottom of the business cycle has passed. The market condition of analog ICs has improved, and the trend is gradually moving in a direction favorable to the company.

Richard Puccio, ADI's Chief Financial Officer, said that the booking volume in the first quarter continued to improve gradually. The strong performance of the industrial and automotive industries will help us achieve sequential and year - on - year growth in the second quarter. We are confident that ADI will return to growth in the 2025 fiscal year.