The Zhitong Finance App learned that during the week when the Philadelphia Semiconductor Index was under pressure due to soaring long-term interest rates, global analog chip giant ADI.US (ADI.US) used a financial report that completely crushed expectations, confirming that the logic of AI computing power expansion is being transmitted to the wider industrial chain. Before the market on Wednesday, Adnor announced financial results for the third quarter of the 2026 fiscal year ending August 1. Revenue broke the $4 billion mark for the first time. All core indicators fully exceeded Wall Street expectations, and provided fourth quarter guidance that far exceeded market consensus.
Core financial data: both revenue and profit set records, completely crushing expectations
Revenue not only far exceeded analysts' expectations of US$3.91 billion, but also marked the first time in the company's history that it broke the $4 billion mark in a single quarter. GAAP net profit jumped to $1.34 billion from $519 million in the same period last year.
Gross profit margin expanded at the same time as operating profit margin. GAAP gross margin reached 67.3%, operating margin 40.1%; adjusted gross margin 72.5%, adjusted operating margin 50.0%. Operating cash flow for the quarter reached US$1.6 billion, accounting for 40% of revenue; operating cash flow for the past 12 months was US$5.55 billion, and free cash flow was US$4.94 billion.
Business segment: Industry is half full, and communications are doubling
Looking at the terminal market, Adderall's performance growth showed a pattern of multiple blossoms. The industrial business is still the “basic business” of the company, contributing nearly half of its revenue, covering fields such as automation, aerospace and defense, and test equipment. The communications business had the highest growth rate, up 84% year over year — management has previously indicated that data centers already account for the majority of the communications business and contribute products related to power management and optical modules. The automotive business is recovering and growing, and consumer electronics are still a relative drag.
Adderall's position in the AI industry chain is not a GPU, but an analog and power chip that “allows the rack to eat power, measure accurately, and connect”. As the power density of AI servers continues to rise, the power management link from the power grid to the chip is becoming a key bottleneck in the expansion of computing power — and Adeno is the core supplier in this area.
Q4 guidance exceeds expectations: the median value of $4.3 billion crushes market consensus
The median revenue guidance value of $4.3 billion is about 5.4% higher than FactSet's analysts' estimates of $4.08 billion. Adjusted median earnings per share was $3.86, which also far exceeded market expectations of $3.54.
If completed at median value, fourth-quarter revenue will reach another record high in a single quarter. Chief Financial Officer Richard Puccio said the company will use executive discipline and targeted growth investments to achieve a strong end and continue until the 2027 fiscal year.
Shareholder return: quarterly dividend of $1.10 billion, return of $1.7 billion this quarter
Adnor returned $1.7 billion to shareholders during the quarter through dividends and share repurchases. The company's board of directors announced a quarterly cash dividend of $1.10 per share, which will be paid on September 15 to shareholders registered on September 1. Over the past 12 months, the company achieved operating cash flow of 5.5 billion US dollars and free cash flow of 4.9 billion US dollars.
AI infrastructure stocks “repair confidence”
Adeno is benefiting from a surge in investment in AI-driven computing — a trend that is driving demand for power regulation and mass data transmission chips. With the sharp rise in the rack-level power consumption density of AI data centers, “power bottlenecks” are becoming the core constraint limiting the expansion of AI computing power. Adderall's power management chips are widely used in data centers, factory automation equipment, and modern automobiles, and are direct beneficiaries of this trend.
In May of this year, Adeno announced the acquisition of Silicon Valley power management startup Empower Semiconductor for $1.5 billion in cash. Empower's “vertical power delivery” solution installs an integrated voltage regulator directly under or inside the AI chip, and the Empower CEO called “the most difficult problem in AI power supply—the power bottleneck that limits AI throughput.” According to Roche, energy is “the most enduring constraint on scaling next-generation systems.” The deal, which is expected to be completed in the second half of 2026, will further strengthen Adeno's leading position in AI data center power management.
After the earnings report was released, ADI's stock price rose about 1.2% to $381.19 before the market. Since this year, the stock has accumulated a cumulative increase of about 38%, far exceeding the S&P 500 index's increase of about 12% over the same period. However, the stock is still far from its all-time high of $445.91, which was set on June 22.
In a week when chip stocks were under pressure due to higher long-term interest rates and questions about AI capital expenditure, Adderall's earnings report provided another piece of evidence: the expansion of computing power is still being transmitted to a wider industrial chain such as power supplies, optical modules, and test equipment.
Adderall does not produce GPUs, but every rack in an AI server cluster is inseparable from its analog and power chips. While the market is still debating whether Nvidia's “circular financing” is sustainable, Adeno used 40% revenue growth, 84% communications business growth, and Q4 guidelines that crush expectations to prove a more fundamental trend — AI is consuming electricity at an unprecedented rate, and every time electricity flows from the grid to the chip, the precise control of analog chips is required.
CEO Vincent Roche said in the earnings report that the company benefited from a wide range of market demand during the quarter. CFO Puccio pointed out that product and regional demand continued to increase during the quarter, which is reflected in a record fourth quarter outlook. In the second half of AI computing power moving from “whether or not” to “not stable enough, not enough to save electricity”, Adano is in an irreplaceable position.
According to the analysis, Adderall's performance and guidelines that exceeded expectations “eased part of investors' nervousness about AI infrastructure stocks.” After experiencing a wave of tech stock sell-off in July, ADI's earnings report is helping the market re-anchor its confidence in the AI hardware supply chain.