filings.toolsItem 1. Financial Statements
77K characters. Original on sec.gov · Markdown
Item 1. Financial Statements
ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(in thousands, except per share amounts)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Revenue | $ | 4,021,899 | $ | 2,880,348 | $ | 10,805,627 | $ | 7,943,590 | |||||||||||||||
| Cost of sales | 1,314,355 | 1,090,600 | 3,613,309 | 3,111,929 | |||||||||||||||||||
| Gross margin | 2,707,544 | 1,789,748 | 7,192,318 | 4,831,661 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | 533,480 | 454,251 | 1,510,203 | 1,298,980 | |||||||||||||||||||
| Selling, marketing, general and administrative | 397,326 | 325,706 | 1,105,389 | 913,171 | |||||||||||||||||||
| Amortization of intangibles | 187,985 | 187,415 | 563,285 | 562,245 | |||||||||||||||||||
| Special charges, net | (24,216) | 4,348 | 23,766 | 69,980 | |||||||||||||||||||
| Total operating expenses | 1,094,575 | 971,720 | 3,202,643 | 2,844,376 | |||||||||||||||||||
| Operating income: | 1,612,969 | 818,028 | 3,989,675 | 1,987,285 | |||||||||||||||||||
| Nonoperating expense (income): | |||||||||||||||||||||||
| Interest expense | 88,728 | 79,592 | 262,692 | 229,559 | |||||||||||||||||||
| Interest income | (25,377) | (27,083) | (86,199) | (72,295) | |||||||||||||||||||
| Other, net | 3,749 | 2,110 | (3,386) | 5,108 | |||||||||||||||||||
| Total nonoperating expense (income) | 67,100 | 54,619 | 173,107 | 162,372 | |||||||||||||||||||
| Income before income taxes | 1,545,869 | 763,409 | 3,816,568 | 1,824,913 | |||||||||||||||||||
| Provision for income taxes | 205,779 | 244,891 | 469,302 | 345,309 | |||||||||||||||||||
| Net income | $ | 1,340,090 | $ | 518,518 | $ | 3,347,266 | $ | 1,479,604 | |||||||||||||||
| Shares used to compute earnings per common share – basic | 486,021 | 494,390 | 487,500 | 495,560 | |||||||||||||||||||
| Shares used to compute earnings per common share – diluted | 488,837 | 496,726 | 490,317 | 497,865 | |||||||||||||||||||
| Basic earnings per common share | $ | 2.76 | $ | 1.05 | $ | 6.87 | $ | 2.99 | |||||||||||||||
| Diluted earnings per common share | $ | 2.74 | $ | 1.04 | $ | 6.83 | $ | 2.97 | |||||||||||||||
See accompanying notes.
ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(in thousands)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Net income | $ | 1,340,090 | $ | 518,518 | $ | 3,347,266 | $ | 1,479,604 | |||||||||||||||
| Foreign currency translation adjustments | 1,079 | 364 | 2,403 | (548) | |||||||||||||||||||
| Change in fair value of derivative instruments designated as cash flow hedges, net | 1,886 | (6,359) | 2,506 | 11,137 | |||||||||||||||||||
| Changes in pension plans, net | 187 | 542 | 582 | 1,582 | |||||||||||||||||||
| Other comprehensive income (loss) | 3,152 | (5,453) | 5,491 | 12,171 | |||||||||||||||||||
| Comprehensive income | $ | 1,343,242 | $ | 513,065 | $ | 3,352,757 | $ | 1,491,775 | |||||||||||||||
See accompanying notes.
ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share and per share amounts)
| August 1, 2026 | November 1, 2025 | ||||||||||
| ASSETS | |||||||||||
| Current Assets | |||||||||||
| Cash and cash equivalents | $ | 2,165,870 | $ | 2,499,406 | |||||||
| Short-term investments | 159,064 | 1,152,915 | |||||||||
| Accounts receivable | 2,389,577 | 1,436,075 | |||||||||
| Inventories | 1,931,496 | 1,656,323 | |||||||||
| Prepaid expenses and other current assets | 426,523 | 363,342 | |||||||||
| Total current assets | 7,072,530 | 7,108,061 | |||||||||
| Non-current Assets | |||||||||||
| Net property, plant and equipment | 3,351,981 | 3,315,696 | |||||||||
| Goodwill | 27,988,737 | 26,945,180 | |||||||||
| Intangible assets, net | 7,468,220 | 8,013,815 | |||||||||
| Deferred tax assets | 1,689,972 | 1,867,102 | |||||||||
| Other assets | 852,977 | 742,858 | |||||||||
| Total non-current assets | 41,351,887 | 40,884,651 | |||||||||
| TOTAL ASSETS | $ | 48,424,417 | $ | 47,992,712 | |||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
| Current Liabilities | |||||||||||
| Accounts payable | $ | 682,167 | $ | 543,760 | |||||||
| Income taxes payable | 461,804 | 610,370 | |||||||||
| Debt, current | 1,344,855 | — | |||||||||
| Commercial paper notes | 1,005,104 | 446,639 | |||||||||
| Accrued liabilities | 2,162,324 | 1,645,032 | |||||||||
| Total current liabilities | 5,656,254 | 3,245,801 | |||||||||
| Non-current Liabilities | |||||||||||
| Long-term debt | 6,771,624 | 8,145,066 | |||||||||
| Deferred income taxes | 1,837,959 | 2,163,281 | |||||||||
| Income taxes payable | 90,723 | 100,963 | |||||||||
| Other non-current liabilities | 516,960 | 521,846 | |||||||||
| Total non-current liabilities | 9,217,266 | 10,931,156 | |||||||||
| Shareholders’ Equity | |||||||||||
| Preferred stock, $1.00 par value, 471,934 shares authorized, none outstanding | — | — | |||||||||
| Common stock, $0.16 2/3 par value, 1,200,000,000 shares authorized, 484,565,465 shares outstanding (489,654,097 on November 1, 2025) | 80,762 | 81,611 | |||||||||
| Capital in excess of par value | 21,288,447 | 23,349,185 | |||||||||
| Retained earnings | 12,330,779 | 10,539,541 | |||||||||
| Accumulated other comprehensive loss | (149,091) | (154,582) | |||||||||
| Total shareholders’ equity | 33,550,897 | 33,815,755 | |||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 48,424,417 | $ | 47,992,712 |
See accompanying notes.
ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
(in thousands)
| Three Months Ended August 1, 2026 | |||||||||||||||||||||||||||||
| Capital in | Accumulated Other | ||||||||||||||||||||||||||||
| Common Stock | Excess of | Retained | Comprehensive | ||||||||||||||||||||||||||
| Shares | Amount | Par Value | Earnings | Loss | |||||||||||||||||||||||||
| BALANCE, MAY 2, 2026 | 487,087 | $ | 81,183 | $ | 22,287,095 | $ | 11,525,998 | $ | (152,243) | ||||||||||||||||||||
| Net income | 1,340,090 | ||||||||||||||||||||||||||||
| Dividends declared and paid - $1.10 per share | (535,309) | ||||||||||||||||||||||||||||
| Issuance of stock under stock plans and other | 360 | 59 | 61,625 | ||||||||||||||||||||||||||
| Stock-based compensation expense | 96,255 | ||||||||||||||||||||||||||||
| Other comprehensive income | 3,152 | ||||||||||||||||||||||||||||
| Common stock repurchased | (2,882) | (480) | (1,156,528) | ||||||||||||||||||||||||||
| BALANCE, AUGUST 1, 2026 | 484,565 | $ | 80,762 | $ | 21,288,447 | $ | 12,330,779 | $ | (149,091) | ||||||||||||||||||||
| Nine Months Ended August 1, 2026 | |||||||||||||||||||||||||||||
| Capital in | Accumulated Other | ||||||||||||||||||||||||||||
| Common Stock | Excess of | Retained | Comprehensive | ||||||||||||||||||||||||||
| Shares | Amount | Par Value | Earnings | Loss | |||||||||||||||||||||||||
| BALANCE, NOVEMBER 1, 2025 | 489,654 | $ | 81,611 | $ | 23,349,185 | $ | 10,539,541 | $ | (154,582) | ||||||||||||||||||||
| Net income | 3,347,266 | ||||||||||||||||||||||||||||
| Dividends declared and paid - $3.19 per share | (1,556,028) | ||||||||||||||||||||||||||||
| Issuance of stock under stock plans and other | 2,023 | 337 | 120,834 | ||||||||||||||||||||||||||
| Stock-based compensation expense | 263,651 | ||||||||||||||||||||||||||||
| Other comprehensive income | 5,491 | ||||||||||||||||||||||||||||
| Common stock repurchased | (7,112) | (1,186) | (2,445,223) | ||||||||||||||||||||||||||
| BALANCE, AUGUST 1, 2026 | 484,565 | $ | 80,762 | $ | 21,288,447 | $ | 12,330,779 | $ | (149,091) | ||||||||||||||||||||
See accompanying notes.
| Three Months Ended August 2, 2025 | |||||||||||||||||||||||||||||
| Capital in | Accumulated Other | ||||||||||||||||||||||||||||
| Common Stock | Excess of | Retained | Comprehensive | ||||||||||||||||||||||||||
| Shares | Amount | Par Value | Earnings | Loss | |||||||||||||||||||||||||
| BALANCE, MAY 3, 2025 | 496,248 | $ | 82,710 | $ | 24,885,204 | $ | 10,210,338 | $ | (167,632) | ||||||||||||||||||||
| Net income | 518,518 | ||||||||||||||||||||||||||||
| Dividends declared and paid - $0.99 per share | (490,161) | ||||||||||||||||||||||||||||
| Issuance of stock under stock plans and other | 388 | 65 | 42,702 | ||||||||||||||||||||||||||
| Stock-based compensation expense | 84,703 | ||||||||||||||||||||||||||||
| Other comprehensive loss | (5,453) | ||||||||||||||||||||||||||||
| Common stock repurchased | (4,681) | (781) | (1,074,371) | ||||||||||||||||||||||||||
| BALANCE, AUGUST 2, 2025 | 491,955 | $ | 81,994 | $ | 23,938,238 | $ | 10,238,695 | $ | (173,085) | ||||||||||||||||||||
| Nine Months Ended August 2, 2025 | |||||||||||||||||||||||||||||
| Capital in | Accumulated Other | ||||||||||||||||||||||||||||
| Common Stock | Excess of | Retained | Comprehensive | ||||||||||||||||||||||||||
| Shares | Amount | Par Value | Earnings | Loss | |||||||||||||||||||||||||
| BALANCE, NOVEMBER 2, 2024 | 496,297 | $ | 82,718 | $ | 25,082,243 | $ | 10,196,612 | $ | (185,256) | ||||||||||||||||||||
| Net income | 1,479,604 | ||||||||||||||||||||||||||||
| Dividends declared and paid - $2.90 per share | (1,437,521) | ||||||||||||||||||||||||||||
| Issuance of stock under stock plans and other | 2,291 | 382 | 103,947 | ||||||||||||||||||||||||||
| Stock-based compensation expense | 235,108 | ||||||||||||||||||||||||||||
| Other comprehensive income | 12,171 | ||||||||||||||||||||||||||||
| Common stock repurchased | (6,633) | (1,106) | (1,483,060) | ||||||||||||||||||||||||||
| BALANCE, AUGUST 2, 2025 | 491,955 | $ | 81,994 | $ | 23,938,238 | $ | 10,238,695 | $ | (173,085) |
See accompanying notes.
ANALOG DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
| Nine Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 3,347,266 | $ | 1,479,604 | |||||||
| Adjustments to reconcile net income to net cash provided by operations: | |||||||||||
| Depreciation | 315,298 | 301,323 | |||||||||
| Amortization of intangibles | 1,160,358 | 1,202,179 | |||||||||
| Stock-based compensation expense | 263,651 | 235,108 | |||||||||
| Deferred income taxes | (281,941) | (97,318) | |||||||||
| Other | (19,377) | (1,496) | |||||||||
| Changes in operating assets and liabilities | (940,740) | (8,008) | |||||||||
| Total adjustments | 497,249 | 1,631,788 | |||||||||
| Net cash provided by operating activities | 3,844,515 | 3,111,392 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of short-term available-for-sale investments | — | (1,150,240) | |||||||||
| Maturities of short-term available-for-sale investments | 990,657 | 372,778 | |||||||||
| Additions to property, plant and equipment, net | (392,677) | (318,399) | |||||||||
| Proceeds from sale of property, plant and equipment, net | — | 58,892 | |||||||||
| Proceeds from sale of a subsidiary, net | 96,592 | — | |||||||||
| Payments for acquisitions, net of cash acquired | (1,536,049) | (45,652) | |||||||||
| Other | (32,425) | (13,595) | |||||||||
| Net cash used for investing activities | (873,902) | (1,096,216) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from debt | — | 1,490,785 | |||||||||
| Debt repayments | — | (399,998) | |||||||||
| Proceeds from commercial paper notes | 13,061,198 | 6,867,508 | |||||||||
| Payments of commercial paper notes | (12,502,732) | (6,866,581) | |||||||||
| Repurchase of common stock | (2,446,409) | (1,484,166) | |||||||||
| Dividend payments to shareholders | (1,556,028) | (1,437,521) | |||||||||
| Proceeds from employee stock plans | 121,171 | 104,329 | |||||||||
| Other | 18,651 | 40,317 | |||||||||
| Net cash used for financing activities | (3,304,149) | (1,685,327) | |||||||||
| Net (decrease) increase in cash and cash equivalents | (333,536) | 329,849 | |||||||||
| Cash and cash equivalents at beginning of period | 2,499,406 | 1,991,342 | |||||||||
| Cash and cash equivalents at end of period | $ | 2,165,870 | $ | 2,321,191 | |||||||
See accompanying notes.
ANALOG DEVICES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED AUGUST 1, 2026 (UNAUDITED)
(all tabular amounts in thousands except per share amounts and percentages)
Note 1 – Basis of Presentation
In the opinion of management, the information furnished in the accompanying condensed consolidated financial statements reflects all normal recurring adjustments that are necessary to fairly state the results for these interim periods and should be read in conjunction with Analog Devices, Inc.’s (the Company) Annual Report on Form 10-K for the fiscal year ended November 1, 2025 (fiscal 2025) and related notes. The results of operations for the interim periods shown in this report are not necessarily indicative of the results that may be expected for the fiscal year ending October 31, 2026 (fiscal 2026) or any future period.
The Company has a 52-53 week fiscal year that ends on the Saturday closest to the last day in October. Certain prior-year amounts have been reclassified to conform to the fiscal 2026 presentation.
Note 2 – Shareholders’ Equity
As of August 1, 2026, the Company’s Board of Directors had authorized the repurchase of an aggregate of $26.7 billion of its common stock under its common stock repurchase program and $7.4 billion remained available for repurchases under the program.
Note 3 – Accumulated Other Comprehensive (Loss) Income
The following table provides the changes in accumulated other comprehensive (loss) income (AOCI) by component and the related tax effects during the first nine months of fiscal 2026.
| Foreign currency translation adjustment | Unrealized holding gains/losses on derivatives | Pension plans | Total | ||||||||||||||||||||||||||||||||
| November 1, 2025 | $ | (71,700) | $ | (69,777) | $ | (13,105) | $ | (154,582) | |||||||||||||||||||||||||||
| Other comprehensive income before reclassifications | 2,403 | (4,015) | — | (1,612) | |||||||||||||||||||||||||||||||
| Amounts reclassified out of other comprehensive income | — | 8,275 | 582 | 8,857 | |||||||||||||||||||||||||||||||
| Tax effects | — | (1,754) | — | (1,754) | |||||||||||||||||||||||||||||||
| Other comprehensive income | 2,403 | 2,506 | 582 | 5,491 | |||||||||||||||||||||||||||||||
| August 1, 2026 | $ | (69,297) | $ | (67,271) | $ | (12,523) | $ | (149,091) |
The amounts reclassified out of AOCI into the Condensed Consolidated Statements of Income and the Condensed Consolidated Statements of Shareholders’ Equity with presentation location during each period were as follows:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
| Comprehensive (Loss) Income Component | August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | Location | |||||||||||||||||||||||||||
| Unrealized holding gains/losses on derivatives: | ||||||||||||||||||||||||||||||||
| Currency forwards | $ | (1,586) | $ | 1,616 | $ | (1,514) | $ | 483 | Cost of sales | |||||||||||||||||||||||
| (810) | 949 | (134) | 220 | Research and development | ||||||||||||||||||||||||||||
| (1,577) | 1,606 | (1,270) | (442) | Selling, marketing, general and administrative | ||||||||||||||||||||||||||||
| Interest rate derivatives | 3,731 | 3,731 | 11,193 | 11,193 | Interest expense | |||||||||||||||||||||||||||
| (242) | 7,902 | 8,275 | 11,454 | Total before tax | ||||||||||||||||||||||||||||
| 253 | (1,135) | (1,437) | (2,143) | Tax | ||||||||||||||||||||||||||||
| Total amounts reclassified out of AOCI, net of tax | $ | 11 | $ | 6,767 | $ | 6,838 | $ | 9,311 |
Note 4 – Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Net income | $ | 1,340,090 | $ | 518,518 | $ | 3,347,266 | $ | 1,479,604 | |||||||||||||||
| Basic shares: | |||||||||||||||||||||||
| Weighted-average shares outstanding | 486,021 | 494,390 | 487,500 | 495,560 | |||||||||||||||||||
| Earnings per common share basic: | $ | 2.76 | $ | 1.05 | $ | 6.87 | $ | 2.99 | |||||||||||||||
| Diluted shares: | |||||||||||||||||||||||
| Weighted-average shares outstanding | 486,021 | 494,390 | 487,500 | 495,560 | |||||||||||||||||||
| Assumed exercise of common stock equivalents | 2,816 | 2,336 | 2,817 | 2,305 | |||||||||||||||||||
| Weighted-average common and common equivalent shares | 488,837 | 496,726 | 490,317 | 497,865 | |||||||||||||||||||
| Earnings per common share diluted: | $ | 2.74 | $ | 1.04 | $ | 6.83 | $ | 2.97 | |||||||||||||||
| Anti-dilutive shares related to: | |||||||||||||||||||||||
| Outstanding stock-based awards | — | 134 | 42 | 125 |
Note 5 – Special Charges, Net
Liabilities related to special charges, net are included in Accrued liabilities in the Condensed Consolidated Balance Sheets. The activity is detailed below:
| Accrued Special Charges | Global Repositioning Actions | ||||||||||||||||||||||||||||||||||||||||
| Balance at November 1, 2025 | $ | 4,115 | |||||||||||||||||||||||||||||||||||||||
| Employee severance costs, net | 29,085 | ||||||||||||||||||||||||||||||||||||||||
| Severance payments | (1,952) | ||||||||||||||||||||||||||||||||||||||||
| Balance at January 31, 2026 | $ | 31,248 | |||||||||||||||||||||||||||||||||||||||
| Severance payments | (17,858) | ||||||||||||||||||||||||||||||||||||||||
| Balance at May 2, 2026 | $ | 13,390 | |||||||||||||||||||||||||||||||||||||||
| Severance payments | (6,377) | ||||||||||||||||||||||||||||||||||||||||
| Balance at August 1, 2026 | $ | 7,013 | |||||||||||||||||||||||||||||||||||||||
The Company recorded net special charges of $32.4 million as part of its Global Repositioning Actions in the nine months ended August 1, 2026. The Global Repositioning Actions were part of a transformation initiative aimed at aligning the Company’s enterprise strategy and organizational design and streamlining its operations to achieve its long-term strategic plan. The special charges include severance costs, in accordance with the Company’s ongoing benefit plan or statutory requirements at foreign locations, related to the termination of certain employees in manufacturing, engineering and selling, marketing, general and administrative roles.
During the first quarter of fiscal 2026, the Company entered into a sublease agreement for its leased property in San Jose, California. As a result of the sublease transaction, the Company recorded an impairment charge of $15.6 million in net special charges, which represented the excess carrying value of the associated asset group over its estimated fair value. The Company estimated fair value using cash flows from the estimated net sublease rental income discounted at a market rate.
During the third quarter of fiscal 2026, the Company completed the sale of a subsidiary in Penang, Malaysia, which included its facility and certain equipment previously classified as held for sale. The Company recorded a gain on this sale of approximately $24.2 million in Special charges, net.
Note 6 – Industry and Segment Information
The Company’s Chief Executive Officer and Chair has been identified as its Chief Operating Decision Maker (CODM). The following table presents a summary of consolidated net income inclusive of significant segment expenses and other expense information provided to the CODM:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||||||||||||||
| Revenue | $ | 4,021,899 | $ | 2,880,348 | $ | 10,805,627 | $ | 7,943,590 | |||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||||||||
| Cost of sales, including human capital expenses therein | 1,314,355 | 1,090,600 | 3,613,309 | 3,111,929 | |||||||||||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||||||
| Employee compensation costs | 695,060 | 572,258 | 1,938,338 | 1,570,972 | |||||||||||||||||||||||||||||||
| Amortization of acquired intangible assets | 187,985 | 187,415 | 563,285 | 562,245 | |||||||||||||||||||||||||||||||
| Research and development related costs (excluding employee compensation costs) | 137,557 | 125,514 | 416,592 | 389,440 | |||||||||||||||||||||||||||||||
| Special charges, net | (24,216) | 4,348 | 23,766 | 69,980 | |||||||||||||||||||||||||||||||
| Other operating expense (excluding employee compensation costs) (1) | 98,189 | 82,185 | 260,662 | 251,739 | |||||||||||||||||||||||||||||||
| Nonoperating expense (income) | 67,100 | 54,619 | 173,107 | 162,372 | |||||||||||||||||||||||||||||||
| Provision for income taxes | 205,779 | 244,891 | 469,302 | 345,309 | |||||||||||||||||||||||||||||||
| Net income | $ | 1,340,090 | $ | 518,518 | $ | 3,347,266 | $ | 1,479,604 |
(1)Includes depreciation and amortization expenses, facilities expenses, legal expenses, acquisition related transaction costs and other discretionary expenses.
Revenue Trends by End Market
The following tables summarize revenue by end market. The categorization of revenue by end market is determined using a variety of data points including the technical characteristics of the product, the “sold to” customer information, the “ship to” customer information and the end customer product or application into which the Company’s product will be incorporated. The assignment of products to end markets may change over time. When this occurs, the Company reclassifies revenue by end market for prior periods. Such reclassifications typically do not materially change the sizing of, or the underlying trends of results within, each end market.
| Three Months Ended | |||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||||||||||||||||||||
| Revenue | % of Revenue* | Y/Y% | Revenue | % of Revenue* | |||||||||||||||||||||||||
| Industrial | $ | 1,971,926 | 49 | % | 53 | % | $ | 1,292,988 | 45 | % | |||||||||||||||||||
| Automotive | 998,227 | 25 | % | 16 | % | 857,146 | 30 | % | |||||||||||||||||||||
| Communications | 654,515 | 16 | % | 84 | % | 354,768 | 12 | % | |||||||||||||||||||||
| Consumer | 397,231 | 10 | % | 6 | % | 375,446 | 13 | % | |||||||||||||||||||||
| Total revenue | $ | 4,021,899 | 100 | % | 40 | % | $ | 2,880,348 | 100 | % | |||||||||||||||||||
| Nine Months Ended | |||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||||||||||||||||||||
| Revenue | % of Revenue* | Y/Y% | Revenue | % of Revenue* | |||||||||||||||||||||||||
| Industrial | $ | 5,269,825 | 49 | % | 50 | % | $ | 3,512,896 | 44 | % | |||||||||||||||||||
| Automotive | 2,685,246 | 25 | % | 9 | % | 2,454,845 | 31 | % | |||||||||||||||||||||
| Communications | 1,659,553 | 15 | % | 72 | % | 965,036 | 12 | % | |||||||||||||||||||||
| Consumer | 1,191,003 | 11 | % | 18 | % | 1,010,813 | 13 | % | |||||||||||||||||||||
| Total revenue | $ | 10,805,627 | 100 | % | 36 | % | $ | 7,943,590 | 100 | % | |||||||||||||||||||
| * The sum of the individual percentages may not equal the total due to rounding. |
Revenue by Sales Channel
The following tables summarize revenue by sales channel. The Company sells its products globally through a direct sales force, third-party distributors, independent sales representatives and via its website. Distributors are customers that buy products with the intention of reselling them. Direct customers are non-distributor customers and consist primarily of original equipment manufacturers. Other customers include the U.S. government, government prime contractors and certain commercial customers for which revenue is recorded over time.
| Three Months Ended | |||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||||||||||||||
| Channel | Revenue | % of Revenue* | Revenue | % of Revenue* | |||||||||||||||||||
| Distributors | $ | 2,327,081 | 58 | % | $ | 1,592,407 | 55 | % | |||||||||||||||
| Direct customers | 1,588,639 | 39 | % | 1,240,924 | 43 | % | |||||||||||||||||
| Other | 106,179 | 3 | % | 47,017 | 2 | % | |||||||||||||||||
| Total revenue | $ | 4,021,899 | 100 | % | $ | 2,880,348 | 100 | % | |||||||||||||||
| Nine Months Ended | |||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||||||||||||||
| Channel | Revenue | % of Revenue* | Revenue | % of Revenue* | |||||||||||||||||||
| Distributors | $ | 6,140,687 | 57 | % | $ | 4,447,959 | 56 | % | |||||||||||||||
| Direct customers | 4,485,859 | 42 | % | 3,386,571 | 43 | % | |||||||||||||||||
| Other | 179,081 | 2 | % | 109,060 | 1 | % | |||||||||||||||||
| Total revenue | $ | 10,805,627 | 100 | % | $ | 7,943,590 | 100 | % | |||||||||||||||
| * The sum of the individual percentages may not equal the total due to rounding. |
Note 7 – Fair Value
Assets and Liabilities Recorded at Fair Value on a Recurring Basis
The tables below, set forth by level, present the Company’s financial assets and liabilities, excluding accrued interest components that were accounted for at fair value on a recurring basis as of August 1, 2026 and November 1, 2025. The tables exclude cash on hand and assets and liabilities that are measured at historical cost or any basis other than fair value. As of August 1, 2026 and November 1, 2025, the Company held $1.1 billion and $1.4 billion, respectively, of cash that is excluded from the tables below.
| August 1, 2026 | |||||||||||||||||||||||
| Fair Value Measurement at Reporting Date Using: | |||||||||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Total | |||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
| Government and institutional money market funds | $ | 715,175 | $ | — | $ | 715,175 | |||||||||||||||||
| Corporate obligations (1) | — | 338,091 | 338,091 | ||||||||||||||||||||
| Short-term investments: | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
| Corporate obligations (1) | — | 159,064 | 159,064 | ||||||||||||||||||||
| Other assets: | |||||||||||||||||||||||
| Forward foreign currency exchange contracts (2) | — | 7,256 | 7,256 | ||||||||||||||||||||
| Deferred compensation plan investments | 128,158 | — | 128,158 | ||||||||||||||||||||
| Total assets measured at fair value | $ | 843,333 | $ | 504,411 | $ | 1,347,744 | |||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Forward foreign currency exchange contracts (2) | $ | — | $ | 10,535 | $ | 10,535 | |||||||||||||||||
| Interest rate derivatives (3) | — | 42,478 | 42,478 | ||||||||||||||||||||
| Total liabilities measured at fair value | $ | — | $ | 53,013 | $ | 53,013 |
(1)The amortized cost of the Company’s investments classified as available-for-sale as of August 1, 2026 was $498.3 million.
(2)The Company has master netting arrangements by counterparty with respect to derivative contracts. See Note 8, Derivatives, in these Notes to Condensed Consolidated Financial Statements for more information related to the Company’s master netting arrangements.
(3)The carrying value of the related debt was adjusted by an equal and offsetting amount. The fair value of interest rate derivatives is estimated using a discounted cash flow analysis based on the contractual terms of the derivatives. See Note 8, Derivatives, in these Notes to Condensed Consolidated Financial Statements.
| November 1, 2025 | |||||||||||||||||||||||
| Fair Value Measurement at Reporting Date Using: | |||||||||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Total | |||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
| Government and institutional money market funds | $ | 740,730 | $ | — | $ | 740,730 | |||||||||||||||||
| Corporate obligations (1) | — | 397,707 | 397,707 | ||||||||||||||||||||
| Short-term investments (2): | |||||||||||||||||||||||
| Available-for-sale: | |||||||||||||||||||||||
| Corporate obligations (1) | — | 656,839 | 656,839 | ||||||||||||||||||||
| Bank obligations (1) | — | 496,076 | 496,076 | ||||||||||||||||||||
| Other assets: | |||||||||||||||||||||||
| Forward foreign currency exchange contracts (3) | — | 6,708 | 6,708 | ||||||||||||||||||||
| Deferred compensation plan investments | 105,188 | — | 105,188 | ||||||||||||||||||||
| Total assets measured at fair value | $ | 845,918 | $ | 1,557,330 | $ | 2,403,248 | |||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Forward foreign currency exchange contracts (3) | $ | — | $ | 7,975 | $ | 7,975 | |||||||||||||||||
| Interest rate derivatives (4) | — | 12,550 | 12,550 | ||||||||||||||||||||
| Total liabilities measured at fair value | $ | — | $ | 20,525 | $ | 20,525 |
(1)The amortized cost of the Company’s investments classified as available-for-sale as of November 1, 2025 was $1.6 billion.
(2)Available-for-sale securities are classified as current assets on the Condensed Consolidated Balance Sheets if the securities are available to be converted into cash to fund current operations.
(3)The Company has master netting arrangements by counterparty with respect to derivative contracts. See Note 8, Derivatives, in these Notes to Condensed Consolidated Financial Statements for more information related to the Company’s master netting arrangements.
(4)The carrying value of the related debt was adjusted by an equal and offsetting amount. The fair value of interest rate derivatives is estimated using a discounted cash flow analysis based on the contractual terms of the derivatives. See Note 8, Derivatives, in these Notes to Condensed Consolidated Financial Statements.
Assets and Liabilities Not Recorded at Fair Value on a Recurring Basis
San Jose, California leased property asset group — As a result of a sublease transaction involving a leased property
in San Jose, California, the Company estimated the fair value of the sublease assets using discounted cash flows from the estimated net sublease rental income discounted at a market rate and recorded an impairment charge which represented the excess carrying value of the asset group associated with the leased property over its estimated fair value. These assets are considered a Level 2 fair value measurement. See Note 5, Special Charges, Net, in these Notes to Condensed Consolidated Financial Statements for additional information.
Debt — The table below presents the estimated fair values of certain financial instruments not recorded at fair value on a recurring basis. Given the short tenure of the Company’s commercial paper notes, the carrying value of the outstanding commercial paper notes approximates the fair values, and therefore, are excluded from the table below ($1.0 billion and $0.4 billion as of August 1, 2026 and November 1, 2025, respectively). The fair values of the senior unsecured notes are obtained from broker prices and are classified as Level 1 measurements according to the fair value hierarchy.
| August 1, 2026 | November 1, 2025 | ||||||||||||||||||||||
| Principal Amount Outstanding | Fair Value | Principal Amount Outstanding | Fair Value | ||||||||||||||||||||
| 2026 Notes, due December 2026 | 900,000 | 897,938 | 900,000 | 895,623 | |||||||||||||||||||
| 2027 Notes, due June 2027 | 440,212 | 437,134 | 440,212 | 436,916 | |||||||||||||||||||
| 2028 Notes, due June 2028 | 850,000 | 846,187 | 850,000 | 856,345 | |||||||||||||||||||
| 2028 Notes, due October 2028 | 750,000 | 705,821 | 750,000 | 704,186 | |||||||||||||||||||
| 2030 Notes, due June 2030 | 650,000 | 643,874 | 650,000 | 659,834 | |||||||||||||||||||
| 2031 Notes, due October 2031 | 1,000,000 | 872,143 | 1,000,000 | 884,390 | |||||||||||||||||||
| 2032 Notes, due October 2032 | 300,000 | 294,449 | 300,000 | 301,546 | |||||||||||||||||||
| 2034 Notes, due April 2034 | 550,000 | 544,285 | 550,000 | 571,370 | |||||||||||||||||||
| 2036 Notes, due December 2036 | 144,278 | 134,210 | 144,278 | 138,756 | |||||||||||||||||||
| 2041 Notes, due October 2041 | 750,000 | 523,880 | 750,000 | 555,925 | |||||||||||||||||||
| 2045 Notes, due December 2045 | 332,587 | 304,327 | 332,587 | 327,992 | |||||||||||||||||||
| 2051 Notes, due October 2051 | 1,000,000 | 603,881 | 1,000,000 | 662,609 | |||||||||||||||||||
| 2054 Notes, due April 2054 | 550,000 | 496,578 | 550,000 | 541,087 | |||||||||||||||||||
| Total senior unsecured notes | $ | 8,217,077 | $ | 7,304,707 | $ | 8,217,077 | $ | 7,536,579 | |||||||||||||||
Note 8 – Derivatives
Foreign Exchange Exposure Management — The total notional amounts of forward foreign currency derivative instruments designated as hedging instruments of cash flow hedges as of August 1, 2026 and November 1, 2025 were $495.2 million and $297.0 million, respectively, and the fair values of these instruments in the Company’s Condensed Consolidated Balance Sheets were as follows:
| Fair Value At | |||||||||||||||||
| Balance Sheet Location | August 1, 2026 | November 1, 2025 | |||||||||||||||
| Forward foreign currency exchange contracts | Prepaid expenses and other current assets | $ | 1,195 | $ | 4,403 | ||||||||||||
| Forward foreign currency exchange contracts | Accrued liabilities | $ | 7,623 | $ | 4,399 |
As of August 1, 2026 and November 1, 2025, the total notional amounts of undesignated hedges related to forward foreign currency exchange contracts were $455.1 million and $207.3 million, respectively, and the fair values of undesignated hedges in the Company’s Condensed Consolidated Balance Sheets were as follows:
| Fair Value At | |||||||||||||||||
| Balance Sheet Location | August 1, 2026 | November 1, 2025 | |||||||||||||||
| Undesignated hedges related to forward foreign currency exchange contracts | Prepaid expenses and other current assets | $ | 6,061 | $ | 2,305 | ||||||||||||
| Undesignated hedges related to forward foreign currency exchange contracts | Accrued liabilities | $ | 2,912 | $ | 3,576 |
Interest Rate Exposure Management — The Company does not consider the risk of counterparty default to be significant. The gain or loss on the Company’s interest rate swap transactions attributable to the hedged benchmark interest rate risk and the offsetting gain or loss on the related interest rate swaps were recorded as follows:
| August 1, 2026 | November 1, 2025 | ||||||||||||||||||||||||||||||||||
| Balance Sheet Location | Loss on Swaps | Gain on Note | Loss on Swaps | Gain on Note | |||||||||||||||||||||||||||||||
| Accrued liabilities | $ | 42,478 | $ | — | $ | 12,550 | $ | — | |||||||||||||||||||||||||||
| Long-term debt | $ | — | $ | 42,478 | $ | — | $ | 12,550 |
For further information on the unrealized holding gains (losses) on derivatives included in and reclassified out of AOCI into the Condensed Consolidated Statements of Income related to forward foreign currency exchange contracts, see Note 3, Accumulated Other Comprehensive (Loss) Income, in these Notes to Condensed Consolidated Financial Statements.
Note 9 – Inventories
Inventories at August 1, 2026 and November 1, 2025 were as follows:
| August 1, 2026 | November 1, 2025 | ||||||||||
| Raw materials | $ | 85,123 | $ | 70,183 | |||||||
| Work in process | 1,458,059 | 1,218,625 | |||||||||
| Finished goods | 388,314 | 367,515 | |||||||||
| Total inventories | $ | 1,931,496 | $ | 1,656,323 | |||||||
Note 10 – Debt
Revolving Credit Agreements
On July 2, 2026, the Company entered into a Credit Agreement (the 364-Day Revolving Credit Agreement) with Bank of America, N.A. as administrative agent and the other banks identified therein as lenders. The 364-Day Revolving Credit Agreement provides for a 364-day unsecured revolving credit facility in an aggregate principal amount not to exceed $3.0 billion, expiring on July 1, 2027. The 364-Day Revolving Credit Agreement is in addition to the Fourth Amended and Restated Credit Agreement, dated as of April 11, 2025, with Bank of America, N.A. as administrative agent and the other banks identified therein as lenders.
Both agreements contain customary representations and warranties, and affirmative and negative covenants and events of default applicable to the Company and its subsidiaries. As of August 1, 2026, the Company was in compliance with these covenants.
Note 11 – Acquisitions
Empower Semiconductor
On July 7, 2026, the Company completed the acquisition of all of the voting interests of Empower Semiconductor, Inc. (Empower), a provider of integrated voltage regulators and power management solutions, for approximately $1.5 billion. The acquisition was accounted for as a business combination. The preliminary purchase price allocation resulted in the recognition of $1.0 billion of goodwill, $0.6 billion of intangible assets, primarily technology-based, and $0.1 billion of deferred tax liabilities. The goodwill is attributable to the expected future economic benefits arising from the acquisition, including the enhancement of the Company’s power technology portfolio. None of the goodwill is expected to be deductible for tax purposes. Revenue and earnings attributable to Empower since the acquisition date were immaterial to the Company's condensed consolidated financial statements. The Company recognized approximately $23.4 million of transaction-related costs, including legal, accounting and other related fees that were expensed during the third quarter of fiscal 2026. These costs are included in the Condensed Consolidated Statement of Income in Operating expenses within Selling, marketing, general and administrative expenses.
The purchase accounting for the acquisition is preliminary and remains subject to adjustment as the Company completes its valuation of assets acquired and liabilities assumed. The Company expects to complete the purchase accounting within one year of the acquisition date.
Note 12 – Goodwill and Intangible Assets
Goodwill
The following table presents the changes in goodwill during the first nine months of fiscal 2026:
| Balance as of November 1, 2025 | $ | 26,945,180 | |||
| Acquisition of Empower (Note 11) | 1,028,880 | ||||
| Net other acquisitions and dispositions | 14,677 | ||||
| Balance as of August 1, 2026 | $ | 27,988,737 |
Intangible Assets
As of August 1, 2026 and November 1, 2025, the Company’s intangible assets consisted of the following:
| August 1, 2026 | November 1, 2025 | ||||||||||||||||||||||
| Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | ||||||||||||||||||||
| Customer relationships | $ | 10,366,740 | $ | 5,874,473 | $ | 10,335,903 | $ | 5,311,189 | |||||||||||||||
| Technology-based | 8,201,637 | 5,225,684 | 7,617,866 | 4,628,765 | |||||||||||||||||||
| Trade-name | 72,200 | 72,200 | 72,200 | 72,200 | |||||||||||||||||||
| Assembled workforce | 1,800 | 1,800 | 1,800 | 1,800 | |||||||||||||||||||
| Total | $ | 18,642,377 | $ | 11,174,157 | $ | 18,027,769 | $ | 10,013,954 |
Note 13 – Income Taxes
The Company’s effective tax rates for the three- and nine-month periods ended August 1, 2026 were below the U.S. statutory tax rate of 21% due to lower statutory tax rates applicable to the Company's operations in the foreign jurisdictions in which it earns income.
During fiscal 2025, the Company received an assessment from the U.S. Internal Revenue Service (IRS) for fiscal 2018 and fiscal 2019, totaling approximately $267.0 million. The assessment excludes any penalties and interest. The assessment pertains to transfer pricing arrangements between the Company and one of its wholly-owned foreign subsidiaries. The Company firmly disagrees with this assessment and maintains that its transfer pricing is appropriate. Consequently, the Company has not recorded any additional tax liability related to fiscal 2018 and fiscal 2019 in relation to this issue, nor to any other periods. The Company intends to vigorously defend its original tax return position and is preparing for an appeal with the IRS. Should the IRS ultimately prevail regarding its assessments for fiscal 2018 and fiscal 2019, such a resolution, along with any potential impact on subsequent fiscal years, could have a material adverse effect on the Company’s income tax expense and net earnings in future periods.
Note 14 – New Accounting Pronouncements
Standards Implemented
Income Taxes
In December 2023, the Federal Accounting Standards Board (FASB) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires the disaggregation of information in existing income tax disclosures related to the effective tax rate reconciliation and income taxes paid. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. The Company adopted this ASU in fiscal 2026 and will include required financial statement disclosures in its Annual Report on Form 10-K for fiscal 2026.
Standards to Be Implemented
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, requiring public companies to disaggregate key expense categories such as inventory purchases, employee compensation and depreciation in their financial statements. This aims to improve investor insights into company performance. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact adoption will have on its financial statement disclosures.
Note 15 – Subsequent Events
On August 18, 2026, the Board of Directors of the Company declared a cash dividend of $1.10 per outstanding share of common stock. The dividend will be paid on September 15, 2026 to all shareholders of record at the close of business on September 1, 2026 and is expected to total approximately $533.0 million.
Previous: Cover and table of contents · Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations