Chipmaker Analog Devices (ADI) reported a 21% jump in earnings for the first quarter helped by lower costs and expenses as well as a decline in income taxes provision. The results exceeded analysts’ expectations, aided by the ongoing 4G upgrades and initial 5G deployments.
Net income climbed 21% to $355 million and earnings jumped 22% to $0.95 per share. Adjusted earnings dropped by 11% to $1.33 per share.
Revenue declined 2% to $1.54 billion. The top line was hurt by a fall in three segments. However, revenue came in at the high-end of the company’s guidance range with continued strength in its communications market related to ongoing 4G upgrades and initial 5G deployments.
Industrial revenue declined by 7% year-over-year to $728.1 million and automotive revenue inched down by 2% to $259.5 million. Consumer revenue plunged 21% to $208.3 million while communications revenue jumped by 34% to $345.2 million.
During the first quarter, the management returned more than $400 million to shareholders through dividends and share repurchases. Meanwhile, the board of directors declared a cash dividend of $0.54 per share, to be paid on March 12, 2019, to all shareholders of record on March 1, 2019.
Encouraged by the strong results, the company expects its second-quarter adjusted earnings of $1.30 per share, plus or minus seven cents. The guidance for unadjusted earnings and revenues is $0.94 per share, plus or minus seven cents, and $1.50 billion, plus or minus $50 million, respectively. The company’s second-quarter guidance came in line with market expectations.
Shares of Analog Devices opened higher on Wednesday and is trading in the green territory. The stock has risen over 22% in the past year and over 23% in the past three months.