Analog Devices, Inc. · NASDAQ:ADI
Analog Devices — Raymond James Conference 2020
16 slides from Analog Devices's conference presentation, March 2020
Slide 1: Analog Devices, Inc. (ADI) Company Presentation
Analog Devices, Inc. (ADI) Company Presentation Raymond James Conference, March 2020 PRASHANTH MAHENDRA-RAJAH, CFO ©2020 Analog Devices, Inc. All rights reserved.
Slide 2: Forward Looking Statements; Non-GAAP Reconciliations
Forward Looking Statements; Non-GAAP Reconciliations ► This presentation contains forward-looking statements, which address a variety of subjects including, for example, our statements regarding expected financial results, expected product development and technical advances, anticipated market trend
Slide 3: ADI Powerfully Bridges the Physical and Digital Worlds
ADI Powerfully Bridges the Physical and Digital Worlds Currently, 10% of enterprise-generated data is processed outside the cloud, and by 2025, this amount is expected to grow to 75%1 ... ADI will be a critical partner in the collection, curation, and communication of our customers’ edge data Physic
Slide 4: ADI at a Glance
ADI at a Glance A leading global high-performance analog technology company Corporate Headquarters located in Norwood, MA Founded 1965 Market Cap ~$45 billion FY19 Revenue ~$6 billion Principal locations FY19 R&D >$1 billion Other locations FY19 FCF ~$2 billion (33% margin) People Recognition Innova
Slide 5: End-Market Breakdown
End-Market Breakdown Consumer Portable Devices Prosumer Audio/Video Industrial Automotive Aerospace and Defense Cabin Electronics Energy Powertrain Factory Automation Safety $6B Healthcare Instrumentation FY19 Revenue Communications Wired/Optical Networking Wireless 5 Source: 2019 10-K.
Slide 6: Revenues are Incredibly Sticky…
Revenues are Incredibly Sticky… Over 40% of FY19 revenue generated from products released a decade or longer ago 2018 to 2020 2015 to 2017 2012 to 2014 Revenue 2009 to 2011 2006 to 2008 2003 to 2005 2000 to 2002 Pre-2000 FY13 FY14 FY15 FY16 FY17 FY18 FY19 6 Includes Linear Technology Corporation “Li
Slide 7: …and Highly Diverse ~45K Products
…and Highly Diverse ~85% of ADI revenue is derived from products that individually contribute 0.1% or less FY19 Revenue by Product ~45K Products 7
Slide 8: Our Priorities, Driving ADI's Long-term Success
Our Priorities, Driving ADI’s Long-term Success Strategic Priorities Focus Areas • Robust customer engagement: customers are facing a scarcity of available analog engineering talent & encountering more complex challenges Deepening 1 • Partnering more deeply with customers… ADI is not just a componen
Slide 9: We are a Top Tier Firm in a Top Tier Industry
We are a Top Tier Firm in a Top Tier Industry 5 Year Sales & Operating Income CAGR1 Operating & FCF Margins1,2 41% 22% 33% 16% 14% 27% 20% 18% 9% 12% 5% 6% ADI Philadelphia Semi Index S&P 500 Index ADI Philadelphia Semi Index S&P 500 Index Sales Operating Income Operating Margin FCF Margin Top 10% o
Slide 10: ADI Has Delivered Superior Returns with Less Volatility
ADI Has Delivered Superior Returns with Less Volatility Compounded Annualized Stock Return Since SOX Inception 15% 12% 11% 10% ADI SOX NASDAQ S&P 500 Source: Bloomberg and Analog Devices 10 Return calculation period is 12/1/93 to 2/18/20
Slide 11: Long-Term Financial Model
Long-Term Financial Model Targets Upside from stronger GDP, LTC revenue Sales Growth Mid-single digit synergies Gross Margin 70%+ Industry-leading gross margins Operating Margin 39% to 45% Operating expenses to lag revenue growth EPS/FCF Growth 8% to 12% EPS and FCF grow > revenue growth FCF Margin
Slide 12: Focused Strategy Delivering Superior ESG Performance
Focused Strategy Delivering Superior ESG Performance ADI is committed to engineering a sustainable future, while making a positive impact for our planet and people Protect and Regenerate Empower Impact Through the Environment People Engagement • Reduce climate change • Broaden access to digital econ
Slide 13: Q&A
ANALOG DEVICES AHEAD OF WHAT'S POSSIBLE™ Q&A 13
Slide 14: Appendix
ANALOG DEVICES AHEAD OF WHAT'S POSSIBLE™ Appendix
Slide 15: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation FY 19 FY 19 GAAP Revenue $5,991,065 GAAP Revenue $5,991,065 GAAP Gross Margin $4,013,750 Net Cash Provided by Operating Activites $2,253,100 GAAP Operating Expenses $2,303,142 % of Revenue 38% GAAP Operating Income $1,710,608 Capital Expenditures $275,372 GAAP Operati
Slide 16: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation FY 14 FY 19 GAAP Operating Income $752,484 GAAP Operating Income $1,710,608 Hittite Operations -$982 Acquisition Related Expenses $626,777 Acquisition Related Expenses $93,675 Restructuring Related Expenses $95,659 Acquisition Related Transaction Costs $27,110 Adjuste