Analog Devices (ADI) Morgan Stanley Technology, Media & Telecom Conference 2026 summary

Business performance and market dynamics

• Achieved nine consecutive quarters of above-seasonal performance, driven by strong ATE, aerospace/defense, data center, automotive, and diversified consumer segments.

• ATE business expected to grow over 40% year-over-year in 2025, fueled by high-performance compute and memory demand.

• Data center business grew 50% year-over-year in the last three quarters of 2025, benefiting from massive CapEx expansions.

• Automotive segment saw back-to-back record years, with significant share gains and content growth, especially in China.

• Consumer segment diversified beyond handsets, with six consecutive quarters of growth.

Cyclical and inventory trends

• Broad industrial market is in a cyclical upturn, with 90% of expected parts moving and positive book-to-bill ratios across all sub-markets and geographies.

• Channel inventories have been aggressively reduced, with current levels below historical norms and a shift to holding more inventory on the balance sheet.

• No expectation for significant restocking; lead times remain short, and inventory management is closely aligned with operational cycle times.

• Built more die bank and finished goods buffers to support strong turns business and upcycle demand.

End market and segment outlook

• Aerospace and defense expected to grow above company average, supported by global spending increases and a shift to higher-value solutions.

• Industrial sub-sectors like automation, energy, and healthcare remain 20% below prior peaks, indicating further room for cyclical recovery.

• Automotive inventories are lean, with China driving growth and higher content opportunities as ADAS penetration increases.

• Data center and communications segments are robust, with significant R&D investment in power and optical solutions, including vertical power and high-speed optical modules.