Analog Devices Inc. ADI, -2.79% reported Wednesday record fiscal third-quarter profit and revenue that rose above expectations, as gross margin improved, while the fourth-quarter outlook was in line with forecasts, and the chipmaker’s stock slipped 0.7% in premarket trading. Net income for the quarter to July 31 rose to $503.3 million, or $1.35 a share, from $362.7 million, 97 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share grew to $1.72 from $1.36, beating the FactSet consensus of $1.62. Revenue increased 20.8% to $1.76 billion, above the FactSet consensus of $1.71 billion. Gross margin as a percentage of revenue improved to 69.4% from 66.8%, as cost of sales rose 11.2%. For the fourth quarter, the company expects adjusted EPS of $1.72, plus or minus 11 cents, and revenue of $1.78 billion, plus or minus $70 million, compared with the FactSet consensus for EPS of $1.71 and for revenue of $1.76 billion. “All markets increased sequentially with our Industrial and Automotive segments once again achieving records,” said Chief Executive Vincent Roche. “Robust bookings across all end markets, combined with lean inventories and ongoing capacity additions will enable us to close this year on a high note and continue to grow into fiscal 2022.” The stock has gained 12.6% year to date through Tuesday, while the PHLX Semiconductor Index SOX, -1.98% has advanced 16.5% and the S&P 500 SPX, -0.71% has rallied 18.4%.
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