Analog Devices (NASDAQ:ADI) scored a double beat, on both revenue and net income, in its just-reported Q3.
For the period, the company's top line came in at $870 million, a slight improvement over the Q3 2015 tally. Net income saw a sharper increase, moving 6% to $230 million ($0.74 per diluted share; $0.82 on an adjusted basis).
Those numbers were more than enough to exceed the average analyst estimates, which anticipated just over $865 million on the top line and an adjusted per-share net income of $0.76.
Out of the company's four divisions, communications was the star performer, with its revenue rising by 23% to over $174 million, or around 20% of total top line. The automotive unit also saw gains, while the take for both the consumer and industrial divisions fell on a year-over-year basis.
Does it matter?
Judging by the tepid rise in the stock price in the wake of the results release, investors didn't seem too impressed with Analog Devices' Q3.
Perhaps it was overshadowed by last month's news that the company would acquire the complementary Linear Technology (NASDAQ:LLTC), an analog integrated circuits manufacturer. Analog Devices is scooping up Linear Technology in a $14.8 billion cash-and-stock deal.
There have been concerns that Analog Devices, a key supplier of components for the iPhone, is too dependent on Apple for its success. The acquisition of the well-diversified Linear Technology will help allay those worries. This is a likely reason why Analog Devices' stock price has held up despite the 11-figure price tag of the deal.
So although Analog Devices' Q3 results announcement might not have been as compelling as the Linear Technology news, it was encouraging for investors nevertheless. The company posted a decent quarter heading into its big merger.