The Covid-19 pandemic has impacted regions and industries differently, and some semiconductor companies have been more exposed that others. Analog Devices has half its business in the industrial market with a growing automotive engagement, particularly with electric vehicle battery systems and saw stronger results recently than expected.
“What we have seen is that the demand has been more robust than we would have expected. Automotive is more of a focus in Europe and that suffered a big decline but the interesting thing is the healthcare went up dramatically, an orders of magnitude increase, and the infrastructure communications business remains strong in 4G and now 5G.
“I think the interesting piece is industrial wasn’t as weak – European industrial are less exposed to oil and gas, and we didn’t see the decline that the US did.”
There are increasing expectations for the rest of the year. “As factories reopen that plays to our strength in EVs, battery monitoring systems, cabin communications, with growth in the A2B audio bus for the premium car market,” he said.
While the pandemic is global the effects were regional. “There is counter regional aspect where as Europe shut down, China was coming out,” he said. “I think overall the impact was not as big as anticipated but we did have to manage our supply chain – we did see some issues with some various rules on movement of people in Asia and we had to work through that.”
“Industrial is perhaps where the danger will be,” he said. “Our customers are reacting differently. The Mittelstand [smaller companies] in Germany didn’t shut down, they went to 70, 80 percent and have been figuring out different ways of engaging during the pandemic. Companies where there was significant automation and robotics were able to achieve more social distancing better than the ‘old school’ factory lines and that suggests there will be a lot of people looking at how they