What changed in Analog Devices's 10-K for the fiscal year ended November 1, 2025

Many of these factors and risks are present and may be exacerbated within our business operations in China. For example, changes in U.S.-China relations, the political environment or international trade policies could result in further revisions to laws or regulations or their interpretation and enforcement, increased taxation, trade sanctions, the imposition of additional import or export duties and tariffs, restrictions on imports or exports, currency revaluations or retaliatory actions, which have had and may continue to have an adverse effect on our business plans and operating results. In addition, export restrictions limit our ability to sell to certain Chinese companies and to third parties that do business with those companies. These restrictions, which have continued to expand over the past several years, have impacted our revenues and results of operations in China and elsewhere. These and similar restrictions have created, and may continue to create, uncertainty and caution with our current or prospective customers and may cause them to amass large inventories of our products, replace our products with products from another supplier that is not subject to the export restrictions or focus on building indigenous semiconductor capacity to reduce reliance on U.S. suppliers. Furthermore, if these export restrictions cause our current or potential customers to view U.S. companies as unreliable, we could suffer reputational damage or lose business to foreign competitors who are not subject to such export restrictions, and our business could be materially harmed. We continue to evaluate the impact of these restrictions on our business as they are updated and expanded, and we expect that they may continue to have direct and indirect adverse impacts on our revenues and results of operations in China and elsewhere. [added] In addition, our success may be adversely affected by China's continuously evolving policies, laws and regulations, including those relating to imports and exports, rare earth materials, antitrust, AI, cybersecurity, data protection and data privacy, the environment, indigenous innovation, the promotion of a domestic semiconductor industry, intellectual property rights and enforcement and protection of those rights.

[added] Recently announced and future tariffs and other trade restrictions could materially and adversely affect our business, financial condition and results of operations.

[added] In 2025, the U.S. government announced a series of tariffs, including tariffs targeting a broad range of imports and targeted tariffs on goods from specific countries and industries. In response, many countries imposed reciprocal tariffs and other trade restrictions on the United States. Although many of these tariffs, countermeasures and other trade restrictions have since been eased or paused, their initial announcements triggered considerable volatility in global markets and heightened economic uncertainty, and the global trade situation, particularly between the United States and China, continues to be highly dynamic. Further, throughout 2025 the U.S. government has initiated numerous investigations into products and industries under Section 232 of the Trade Expansion Act of 1962. For example, in April 2025, the Department of Commerce launched an investigation into the national security impacts of imported semiconductors and semiconductor manufacturing equipment. While the results of this investigation remain unknown, it is expected to result in additional tariffs and trade restrictions that may adversely impact our business. Similar investigations on other industries or products, including automotive, copper, steel, aluminum, critical minerals and aircraft, may also adversely impact the semiconductor industry and our business. These changes have, and similar changes in the future may continue to, increase the cost or reduce the availability of raw materials and supplies we need to operate, cause customers to advance, delay, reduce, or cancel orders, shift buying patterns, impact demand in our end markets, complicate demand forecasting for us and our customers, increase supply chain complexity and contribute to volatility, a broader economic slowdown or recession. Any of these impacts or changes could materially and adversely affect our business, financial condition and results of operations.

Sales to third-party distributors accounted for approximately 56% of our revenue in the year ended November 1, 2025. These independent distributors generally represent product lines offered by several companies and thus could reduce their sales [added] efforts for our products. Further, our distributors could terminate their representation of us with little advance notice or their representation of us could be negatively affected for other reasons. For example, our distributors could be adversely impacted by additional tariffs or export controls, which could limit our ability to conduct business with such distributors, increase our costs and adversely affect our reputation and operating results. In addition, we generally do not require letters of credit from our distributors, including our largest distributor, and are not protected against accounts receivable default or declarations of bankruptcy by these distributors. Our inability to collect open accounts receivable could adversely affect our operating results. Termination of a significant distributor or a group of distributors, whether at our initiative or the distributor's initiative or through consolidation in the distribution industry, or the inability of a distributor to perform its obligations, could divert management's attention and resources, result in disputes, litigation and settlement costs, increase risk that our products may be diverted from authorized distribution channels and sold on the "gray market" and disrupt our business. Further, if we are unable to find suitable replacements with the appropriate scale and resources, our operating results could be adversely affected.

[added] AI technology may also give rise to significant legal and regulatory compliance risk. Evolving rules, regulations and industry standards governing AI may require us to incur greater compliance costs and restrict the use of AI in our products or technologies. Several jurisdictions where we operate are considering or have proposed or enacted legislation and policies regulating AI, including the European Union's AI Act, and lack of consistency among different regulatory regimes may increase our regulatory and compliance burdens. Investigations and enforcement efforts related to the use of AI technology could increase our compliance costs and restrict our ability to use AI in the development of our products and services. As the use of AI in our products, technologies or our business operations changes, we may become subject to new rules, regulations and industry standards, which may exacerbate these risks. In addition, the use of AI in the development of our products and services, in our business operations or by our customers in end products that incorporate our products, could cause loss of intellectual property, or subject us to risks related to intellectual property infringement or misappropriation, data privacy or cybersecurity. AI algorithms or training methodologies may also be flawed, and datasets may contain irrelevant, insufficient or biased information. Further, AI technology has many applications, and our products could be used in applications that are not in accordance with our controls, policies and procedures. Any failure or perceived failure by us to comply with any legal or regulatory requirement could subject us to legal liabilities, damage our reputation or otherwise adversely affect our business.

[added] • disruption to our operations and our ability to generate revenues;

No corresponding language in the FY2025 10-K.

No corresponding language in the FY2025 10-K.

No corresponding language in the FY2025 10-K.

No corresponding language in the FY2025 10-K.

No corresponding language in the FY2025 10-K.

Many of these factors and risks are present and may be exacerbated within our business operations in China. For example, changes in U.S.-China relations, the political environment or international trade policies could result in further revisions to laws or regulations or their interpretation and enforcement, increased taxation, trade sanctions, the imposition of [added] additional import or export duties and tariffs, restrictions on imports or exports, currency revaluations or retaliatory actions, which have had and may continue to have an adverse effect on our business plans and operating results. In addition, export restrictions limit our ability to sell to certain Chinese companies and to third parties that do business with those companies. These [added] restrictions, which have continued to expand over the past several years, have impacted our revenues and results of operations in China and elsewhere. These and similar restrictions [added] have created, and may continue to create, uncertainty and caution with our current or prospective customers and may cause them to amass large inventories of our products, replace our products with products from another supplier that is not subject to the export restrictions or focus on building indigenous semiconductor capacity to reduce reliance on U.S. suppliers. Furthermore, if these export restrictions cause our current or potential customers to view U.S. companies as unreliable, we could suffer reputational damage or lose business to foreign competitors who are not subject to such export restrictions, and our business could be materially harmed. We [added] continue to evaluate the impact of these restrictions on our [added] business as they are updated and expanded, and we expect that they may continue to have direct and indirect adverse impacts on our revenues and results of operations in China and elsewhere. In addition, our success may be adversely affected by China's continuously evolving policies, laws and regulations, including those relating to imports and exports, rare earth materials, antitrust, AI, cybersecurity, data protection and data privacy, the environment, indigenous innovation, the promotion of a domestic semiconductor industry, intellectual property rights and enforcement and protection of those rights.

Sales to third-party distributors accounted for approximately [added] 56% of our revenue in the year ended November [added] 1, 2025. These independent distributors generally represent product lines offered by several companies and thus could reduce their sales efforts for our products. Further, our distributors could terminate their representation of us with little advance notice or their representation of us could be negatively affected for other reasons. For example, our distributors could be adversely impacted by additional tariffs or export controls, which could limit our ability to conduct business with such distributors, increase our costs and adversely affect our reputation and operating results. In addition, we generally do not require letters of credit from our distributors, including our largest distributor, and are not protected against accounts receivable default or declarations of bankruptcy by these distributors. Our inability to collect open accounts receivable could adversely affect our operating results. Termination of a significant distributor or a group of distributors, whether at our initiative or the distributor's initiative or through consolidation in the distribution industry, or the inability of a distributor to perform its obligations, could divert management's attention and resources, result in disputes, litigation and settlement costs, increase risk that our products may be diverted from authorized distribution channels and sold on the "gray market" and disrupt our business. Further, if we are unable to find suitable replacements with the appropriate scale and resources, our operating results could be adversely affected.

As of November [added] 1, 2025, we had approximately [added] $8.6 billion in outstanding indebtedness, including [added] $446.6 million of short-term commercial paper. In addition, we had the ability to incur approximately [added] $2.6 billion of additional indebtedness in direct borrowings under our outstanding commercial paper facility based on amounts available under our unsecured revolving credit facility that were not being used to backstop our outstanding commercial paper balance. Our leverage could have negative consequences, including increasing our vulnerability to adverse economic and industry conditions, limiting our ability to obtain additional financing and limiting our ability to acquire new products and technologies through strategic acquisitions. Further, our net interest expense is exposed to changes in market interest rates. We may also incur additional debt, including debt with variable interest rates, in the future, which would exacerbate these risks.

Revenue [added] increased 17% in fiscal [added] 2025 as compared to fiscal [added] 2024 as a result of [added] broad-based increase in demand for our products. In addition to increased demand, the increase in the Industrial end market [added] was primarily due to customer inventory balances [added] normalizing and growth in the [added] test equipment and aerospace and defense sub-markets. In the Automotive end market, the increase was primarily driven by increases from connectivity solutions. The increase in the Consumer end [added] market was primarily related to portable consumer products and the increase in the Communications end market was primarily driven by [added] growth in the wireline sub-market from data center infrastructure expansion in support of AI applications. These increases were partially offset by the impact of an additional week of operations in fiscal 2024 as compared to fiscal 2025.

Gross margin percentage in fiscal [added] 2025 increased by 440 basis points compared to fiscal [added] 2024, primarily due to [added] higher utilization of our factories due to [added] increased customer demand [added] as well as a decrease in amortization expense related to acquired intangible assets.

The [added] increase in net income in fiscal [added] 2025 as compared to fiscal [added] 2024 was a result of a [added] $899.7 million increase in operating income and a [added] $35.1 million decrease in nonoperating expense, partially offset by a [added] $302.7 million increase in provision for income taxes.

Cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and liabilities. The [added] increase in cash provided by operating activities during fiscal [added] 2025 as compared to fiscal [added] 2024 was primarily a result of [added] higher net income adjusted for noncash items [added] and changes in working capital.

At November [added] 1, 2025, our principal source of liquidity was [added] $3.7 billion of cash, cash equivalents and short-term investments, of which approximately [added] $2.4 billion was held in the United States, with the balance held outside the United States in various foreign subsidiaries. We manage our worldwide cash requirements by, among other things, reviewing available funds held by our foreign subsidiaries and the cost effectiveness by which those funds can be accessed in the United States. We do not expect current regulatory restrictions or taxes on repatriation to have a material adverse effect on our overall liquidity, financial condition or results of operations. Our cash, cash equivalents and short-term investments consist of highly liquid investments, including money market funds and corporate and bank obligations. We maintain these balances with counterparties with high credit [added] ratings and continually monitor the amount of credit exposure to any one issuer and diversify our investments in order to minimize our credit risk.

We may borrow under [added] the Revolving Credit Agreement in the future and use the proceeds for repayment of existing indebtedness, stock repurchases, acquisitions, capital expenditures, working capital and other lawful corporate purposes. The terms of the Revolving Credit Agreement impose restrictions on our ability to undertake certain transactions, to create certain liens on assets and to incur certain subsidiary indebtedness. In addition, the Revolving Credit Agreement contains [added] an interest coverage covenant which requires the ratio of consolidated earnings before interest, taxes, [added] depreciation and amortization (EBITDA) [added] to consolidated interest charges to be greater than [added] 3.0 to 1.0. As of November [added] 1, 2025, we were in compliance with these covenants. See Note [added] 11, Revolving Credit Facility, of the Notes to Consolidated Financial Statements contained in [added] Part II, Item 8 of this Annual Report on Form 10-K for further information on our revolving credit facility.

Our [added] Fourth Amended and Restated Revolving Credit Agreement, dated as of [added] April 11, 2025, with Bank of America N.A. as administrative agent and the other banks identified therein as [added] lenders (the Revolving Credit Agreement) provides for a five year unsecured revolving credit facility in an aggregate principal amount not to exceed [added] $3.0 billion (subject to certain terms and conditions).

Our effective tax rates for fiscal [added] 2025 and fiscal [added] 2024 were below the U.S. statutory rate of 21% due to lower statutory tax rates applicable to our operations in the foreign jurisdictions in which we earn income. For fiscal [added] 2025 and fiscal [added] 2024 our pretax income was primarily generated in Ireland at a tax rate of 12.5%. Our effective tax rate for fiscal [added] 2025 was impacted by a [added] net deferred tax expense of $153.8 million related to the remeasurement of our Global Intangible Low-Taxed Income related deferred tax assets and liabilities attributable to the passage of the One Big Beautiful Bill Act.

During fiscal [added] 2025, we used a combination of the quantitative and qualitative methods of assessing [added] goodwill. During fiscal 2024, we used the qualitative method of assessing goodwill. In all periods presented, we concluded the reporting [added] unit fair values exceeded their carrying amounts as of the assessment dates and no risk of impairment existed.

Total revenue [added] increased in fiscal [added] 2025 as compared to fiscal [added] 2024 in most regions due to [added] broad-based demand increases as discussed above under the heading Revenue Trends by End Market.

Special charges, net [added] increased in fiscal [added] 2025 as compared to fiscal [added] 2024, primarily due to [added] increased charges related to our [added] Global Repositioning Actions. See Note 5, Special Charges, Net, of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for more information.

The year-over-year [added] decrease in nonoperating expense in fiscal [added] 2025 as compared to fiscal [added] 2024 was primarily the result of higher interest [added] income from higher cash, cash equivalents and short-term investments balances during fiscal 2025.

If we elect not to use this option, or we determine that it is more likely than not that the fair value of our reporting unit is less than its net book value, then we perform the quantitative goodwill impairment test. The quantitative goodwill impairment test requires us to compare the fair value of our reporting unit with its carrying amount. If fair value is determined to be less than carrying value, an impairment loss is recognized for the amount of the carrying value that exceeds the amount of the reporting unit's fair value, not to exceed the total amount of goodwill allocated to the reporting unit. Additionally, we consider income tax effects from any tax deductible goodwill on the carrying amount of [added] our reporting unit when measuring the goodwill impairment loss, if applicable. We determine the fair value of our reporting [added] unit using a weighting of the income and market approaches. Under the income approach, we use a discounted cash flow methodology which requires management to make significant estimates and assumptions related to forecasted revenues, gross profit margins, operating income margins, working capital cash flow, perpetual growth rates, and long-term discount rates, among others. For the market approach, we use the guideline public company method. Under this method we utilize information from comparable publicly traded companies with similar operating and investment characteristics as the reporting [added] unit, to create valuation multiples that are applied to the operating performance of the reporting unit being tested, in order to obtain [added] the respective fair [added] value. In order to assess the reasonableness of the calculated reporting unit fair value, we reconcile the fair value of our reporting unit determined, as described above, to our total company market capitalization, allowing for a reasonable control premium.

The [added] increase in accounts receivable for fiscal [added] 2025 compared to fiscal [added] 2024 was primarily the result of variations in the timing of collections and billings and [added] increased revenue levels in the fourth quarter of fiscal [added] 2025 as compared to the fourth quarter of fiscal [added] 2024.

Net additions to property, plant and equipment were [added] $533.6 million in fiscal [added] 2025. We expect capital expenditures for fiscal [added] 2026 to be between approximately 4% and 6% of fiscal [added] 2026 revenue. These capital expenditures will be funded with a combination of cash on hand and cash expected to be generated from future operations, together with existing and anticipated available short- and long-term financing.

As of November [added] 1, 2025, our Board of Directors had authorized us to repurchase $26.7 billion of our common stock under our common stock repurchase program and $9.7 billion remained available for [added] repurchases under the current authorized program. [added] Repurchased shares are held as authorized but unissued shares of common stock. [added] Unless terminated earlier by resolution of our Board of Directors, the repurchase program will expire when the full dollar amount of the authorization has been used to repurchase shares under the program. Future repurchases of common stock will be dependent upon our financial position, results of operations, outlook, liquidity and other factors we deem relevant.

- the carrying [added] value of our reporting unit as of the assessment date compared to [added] the previously calculated fair [added] value as of the date of the most recent quantitative impairment analysis;

R&D expenses [added] increased in fiscal [added] 2025 as compared to fiscal [added] 2024, primarily as a result of [added] higher R&D employee related variable compensation [added] expenses and higher salary and benefit expenses, partially offset by the impact of an additional week of operations in fiscal 2024 as compared to fiscal [added] 2025.

[added] We evaluate goodwill for impairment annually, as well as whenever events or changes in circumstances suggest that the carrying value of goodwill may not be recoverable, utilizing either the qualitative or quantitative method. We [added] have determined that the business operates as a single operating segment and has a single reporting unit [added] for the purpose of goodwill impairment testing. We test goodwill on an annual basis on the first day of the fourth quarter [added] (August 3, 2025 in fiscal 2025) or more frequently if indicators of impairment exist or we reorganize our [added] business.

Investing cash flows generally consist of [added] purchases of property, plant and equipment, available-for-sale investments and acquisitions of other businesses. The change in cash used for investing activities during fiscal [added] 2025 as compared to fiscal [added] 2024 was primarily the result of [added] the net impact of purchases and maturities of available-for-sale investments, partially offset by [added] a decrease in cash used for capital expenditures.

Current liabilities [added] increased to $3.2 billion at November [added] 1, 2025 from $3.0 billion recorded at the end of fiscal [added] 2024, primarily due to [added] increases in accrued liabilities and [added] income taxes payable, partially offset by [added] a decrease in current debt.

SMG&A expenses [added] increased in fiscal [added] 2025 as compared to fiscal [added] 2024, primarily as a result of [added] higher SMG&A employee related [added] variable compensation expenses and [added] salary and benefit expenses, partially offset by an additional week of operations in fiscal 2024 as compared to fiscal [added] 2025.

- the amount by which the fair [added] value of our reporting unit exceeded [added] its carrying value as of the date of the most recent quantitative impairment analysis, which indicated there would need to be substantial negative developments in the markets in which [added] our reporting unit operates in order for there to be potential impairment;

Inventory [added] increased in fiscal [added] 2025 as compared to fiscal [added] 2024, primarily as a result of our efforts to balance manufacturing production, demand and inventory levels. Our inventory levels are impacted by our need to support forecasted sales demand and variations between those forecasts and actual demand.

Financing cash flows generally consist of payments of dividends to shareholders, repurchases of common stock, issuance and repayment of debt and proceeds from the sale of shares of common stock pursuant to employee equity incentive plans. The [added] increase in cash used for financing activities during fiscal [added] 2025 as compared to fiscal [added] 2024 was primarily the result of [added] increased common stock [added] repurchases and dividend payments to shareholders, partially offset by the net proceeds from our debt obligations.

As of November [added] 1, 2025, we had approximately [added] $8.1 billion of carrying value outstanding on our senior notes. The difference in the carrying value of the debt and the principal is due to the unamortized discount and issuance fees and other adjustments on these instruments. The indentures governing certain of our debt instruments contain covenants that may limit our ability to: incur, create, assume or guarantee any debt or borrowed money secured by a lien upon a principal property; enter into sale and lease-back transactions with respect to a principal property; and consolidate with or merge into, or transfer or lease all or substantially all of our assets to, any other party. As of November [added] 1, 2025, we were compliant with these covenants. See Note [added] 12, Debt of the Notes to Consolidated Financial Statements contained in [added] Part II, Item 8 of this Annual Report on Form 10-K for further information on our outstanding debt.

As indicated in the table above, the percentage of total revenue sold via each channel has remained relatively consistent in the periods [added] presented but can fluctuate from time to time based on end market revenue trends. As a percentage of total revenue, the decrease in the distributor channel is primarily due to the decrease in [added] the percentage of revenue from our Industrial end market.

Under our commercial paper program, we may issue short-term, unsecured commercial paper notes in amounts up to a maximum aggregate face amount of [added] $3.0 billion outstanding at any time, with maturities of up to 397 days from the date of issuance. As of November [added] 1, 2025, we had [added] $446.6 million of outstanding borrowings under the commercial paper program recorded in the Consolidated Balance Sheet. We intend to use the net proceeds of the commercial paper program for general corporate purposes, including without limitation, repayment of indebtedness, stock repurchases, acquisitions, capital expenditures and working capital.

On November [added] 24, 2025, our Board of Directors declared a cash dividend of [added] $0.99 per outstanding share of common stock. The dividend will be paid on December [added] 22, 2025 to all shareholders of record at the close of business on December [added] 8, 2025 and is expected to total approximately [added] $484.8 million. We currently expect quarterly dividends to continue in future periods, although they remain subject to determination and declaration by our Board of Directors. The payment of future dividends, if any, will be based on several factors, including our financial performance, outlook and liquidity.