Analog Devices Inc. (NASDAQ:ADI)

The financial data reveals several noteworthy trends across the periods under review.

Revenue

Revenue exhibited a strong upward trajectory from 2020 through 2023, peaking in 2023 at approximately 12.3 billion US dollars. However, there was a notable decline in 2024 to roughly 9.4 billion, followed by a partial recovery to over 11 billion in 2025.

Cost of Sales

Costs of sales increased consistently alongside revenue until 2023, reaching a high of approximately 4.4 billion US dollars. A slight decline occurred in 2024, in line with the revenue drop, followed by a moderate increase in 2025.

Gross Margin

Gross margin expanded significantly from 3.7 billion US dollars in 2020 to a high of 7.9 billion in 2023, mirroring revenue growth. There was a substantial contraction in 2024 to around 5.4 billion, before recovering to approximately 6.8 billion in 2025. This pattern indicates a variable gross margin performance correlating closely with revenue fluctuations.

Research and Development (R&D)

R&D expenses rose steadily from about 1.05 billion in 2020 to a peak near 1.7 billion in 2022, then declined slightly in 2023 and 2024, before increasing again in 2025. This suggests ongoing investment in innovation with some moderation during years of revenue decline.

Selling, Marketing, General and Administrative Expenses (SG&A)

SG&A costs increased markedly from 660 million US dollars in 2020 to approximately 1.27 billion in 2023. Similar to R&D, these expenses decreased in 2024 in parallel with revenue downturn but rose again in 2025, indicating expense adjustments aligned with business volume changes.

Amortization of Intangibles

Amortization expenses more than doubled between 2020 and 2022, peaking close to 1 billion US dollars, then gradually decreased over the following years to approximately 750 million by 2025. This trend points to the impact of prior acquisitions or capitalized intangible assets diminishing over time.

Special Charges, Net

Special charges increased significantly from 52 million in 2020 to nearly 275 million in 2022, then declined substantially in subsequent years. The irregular pattern indicates episodic or one-time cost events impacting specific years.

Operating Expenses

Operating expenses escalated sharply from 2.19 billion US dollars in 2020 to over 4.25 billion in 2022, then decreased slightly in 2023 and further in 2024 before rising again in 2025. This pattern generally follows the scale of business activity and associated cost management.

Operating Income

Operating income more than doubled from roughly 1.5 billion in 2020 to over 3.8 billion in 2023, supported by revenue and gross margin growth. However, a sharp decline to about 2 billion in 2024 corresponds with the revenue drop, with a partial rebound in 2025 to around 2.9 billion.

Interest Expense and Interest Income

Interest expense remained relatively stable around 200-320 million US dollars across the years, with a slight upward trend after 2022. Interest income increased substantially from 4.3 million in 2020 to over 105 million in 2025, contributing positively to nonoperating income.

Nonoperating Income (Expenses)

Nonoperating expenses grew more negative over time, from approximately -187 million in 2020 to about -255 million in 2024, slightly improving in 2025. These expenses, which include interest and other noncore items, had a consistent negative impact on overall profitability.

Income Before Income Taxes

Income before tax increased significantly from 1.3 billion in 2020 to over 3.6 billion in 2023, reflecting improved operational performance. It fell sharply to about 1.78 billion in 2024, then rebounded to approximately 2.7 billion in 2025, in line with operating income trends.

Income Taxes

Provision for income taxes showed variability, with benefited income recorded in 2021 (+61 million), but generally representing tax expenses in other years. The tax burden decreased concurrently with the reduced pre-tax income in 2024 but increased sharply in 2025 to over 444 million, indicating a higher effective tax rate or changes in tax strategy.

Net Income

Net income followed the overall earnings pattern, rising from 1.22 billion in 2020 to a peak of 3.31 billion in 2023, then declining markedly to about 1.64 billion in 2024 before recovering to nearly 2.27 billion in 2025. This trend aligns closely with revenue and operating income fluctuations, highlighting sensitivity to market conditions or operational efficiencies.

In summary, the company demonstrated robust growth in revenues and earnings through 2023, followed by a pronounced contraction in 2024, likely reflecting external market or economic challenges. Operating and nonoperating expenses were managed to some extent in response to revenue declines, but profitability was nonetheless impacted. Recovery signs in 2025 suggest strategic adjustments and resumption of growth. Investment in R&D and SG&A shows consistent commitment to product development and market presence despite fluctuating financial performance.