Analog Devices Inc. (ADI - Free Report) has withdrawn its earlier announced guidance for fiscal second-quarter 2020 on account of the coronavirus outbreak. The company also announced that the supply chain has been disrupted owing to coronavirus crisis.
However, it is monitoring the situation and supply chain teams have been executing business continuity plans.
In addition, the company is taking all the necessary steps to protect the safety, health and well-being of employees, customers, dealers, suppliers and communities. In a bid to combat the COVID-19 pandemic, it has partnered with customers and healthcare organizations to make use of the best healthcare diagnostics solutions for the betterment of employees.
Analog Devices, Inc. Price and Consensus
Second-Quarter Guidance Withdrawn
During fiscal first-quarter 2020 conference call, Analog Devices had issued earnings per share guidance of $1.10 (+/- $0.08).The company had anticipated non-GAAP operating margins to be 37.5% (+/- 100 basis points).
Analog Devices had then cautioned that the outbreak of coronavirus is a concern for the company and would impact end-user demand. It had then anticipated revenues to be $1.35 billion (+/- $50 million).
The company has now withdrawn this guidance, citing that the uncertainty of the impact of the outbreak on financial and operating results cannot be reasonably estimated at this time.
The coronavirus outbreak has dealt a further blow to the semiconductor sector, which was already reeling under the protracted U.S.-China trade tensions and waning global demand. Factory closures across the globe, impact of the restrictions imposed by different governments, supply chain disruptions, and low demand for goods, among others, have hit the sector.
There has been a spate of guidance withdrawals by the industry players lately owing to the volatile situation arising from the deadly virus and its impact on their performance. Companies such as Applied Materials, Inc. (AMAT - Free Report) , Lam Research Corporation (LRCX - Free Report) and FormFactor, Inc. (FORM - Free Report) , among others, have withdrawn their initial guidance.
Production has been suspended in many of the facilities of Analog Devices, primarily due to supply-chain constrains and material shortage. Additional production disruptions in other regions are also expected.
Analog Devices currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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