ADI Price Hike Notice Sparks Buzz! What’s the Latest in the Chip Spot Market?

01 What exactly is the situation with the price increase?

December 17, 2025

Dear Distribution Partner,

We are writing to inform you of an upcoming price adjustment by Analog Devices (ADI). This adjustment is primarily driven by persistent inflationary pressures in raw materials, labor, energy, and logistics. The new pricing will take effect for all orders shipping on or after February 1, 2026.

As a valued distribution partner, we are providing this advance notice to help you manage the transition smoothly. In addition, we will supply you with external communication materials for use when corresponding with ADI customers served through your channel.

ADI’s sales teams will communicate this adjustment directly to customers covered under ADI’s direct sales. Should any ADI direct-served customers have questions regarding their specific account impacts, please coordinate responses jointly with the ADI sales team.

Following this notification, ADI will provide you with a preview price file outlining the materials affected by the adjustment. By the end of 2025, you will also receive a customer-specific quotation list reflecting the updated pricing. Once you receive this preview, you may proactively notify the customers you serve about any updates to their quoted business.

Starting February 1, 2026, ADI will perform a full backlog reprice of all affected order lines and provide distributors with a list containing updated quote numbers and pricing, which will be reflected in the Model N system. Upon receiving the repriced quotation list, we strongly recommend that you update any existing quotes and purchase orders to align with the new pricing.

The ADI channel team will be available to support you throughout this process. Should you have any questions, please do not hesitate to contact us.

Thank you for your continued partnership and support.

In fact, rumors about ADI's impending price increase have been circulating for some time, and speculation about ADI raising prices also emerged last week.

From the manufacturer's perspective, although ADI cited rising cost pressures as the primary reason for the price adjustment in its notice, the company has demonstrated a strong recovery in performance this year.

On November 25 (local time), ADI announced robust results for the fourth quarter and fiscal year 2025. Fourth-quarter revenue reached $3.08 billion, marking a 26% year-over-year increase, with growth across all end markets—particularly in communications and industrial sectors. In the third quarter, ADI's revenue had already shown a 9% sequential increase and a 25% year-over-year rise, with all end markets achieving double-digit growth. For the full 2025 fiscal year, ADI's revenue totaled $11 billion, representing a 17% increase over 2024.

CEO and Chairman Vincent Roche remarked, “ADI’s strong fourth quarter performance capped off a year of both cyclical and secular growth.” CFO Richard Puccio added, “Our fourth-quarter booking trends remained healthy, with industrial business growing and communications showing notable strength. While macroeconomic uncertainties may shape our 2026 fiscal year, we believe we are well-positioned to continue leveraging both the ongoing cyclical recovery and long-term growth opportunities.”

Looking ahead, ADI expects first-quarter fiscal 2026 revenue to be approximately $3.1 billion, plus or minus $100 million. The company anticipates an operating margin of around 31.0%, plus or minus 130 basis points, and an adjusted operating margin of approximately 43.5%, plus or minus 100 basis points.

02 What Changes Are Occurring in the Chip Spot Market?

Rumors about an impending ADI price increase had already been circulating in the market last week. At that time, some members of the Chip Supermarket Distributor Club mentioned that ADI products had been selling faster recently—items that previously took a long time to move were gradually being cleared out. Other members also noted that they had indeed received many ADI stockpiling orders from end customers recently.

In reality, ADI’s market performance has seen a gradual recovery in demand since the third quarter of 2024, with improved circulation and relatively solid overall demand this year. Shortly after the tariff conflicts in April this year, ADI market prices experienced a broad-based increase, though the extent of the rise varied. Although the market later cooled down, in recent months—combined with rumors of a manufacturer price hike—ADI has seen another wave of price increases.

Over the past few days, we have continued to monitor the ADI chip spot market situation. Many industry contacts have reported receiving stockpiling requests from end customers, who are concerned about potential price rises next year.

A friend who primarily deals in spot purchases mentioned that ADI clients have recently been stockpiling, and they have received numerous ADI-related inquiries. While sourcing from channels has become slightly more expensive, the increase is moderate and not as sharp as the rise seen in the broader market. Another ADI spot supplier noted that some end customers are proactively planning ahead, as recent market-wide price hikes have genuinely driven up costs.

Some have observed that inventories at authorized distributors are continuously depleting, prompting many traders to place orders for ADI’s commonly used components. Others have pointed out that there are instances of stockpiling in the market, with some players holding back supply.

However, there are also those who perceive ADI demand as relatively subdued—there is some activity, but overall it remains lukewarm. Meanwhile, the market prices for ADI products are not uniformly rising. Several contacts mentioned that certain ADI part numbers are still caught in intense price competition, with prices repeatedly falling.