The Short Answer
Analog Devices stock (ADI) is generally considered halal for Muslim investors. Analog Devices designs and manufactures analog, mixed-signal, and power-management chips used in industrial, automotive, communications, and healthcare systems. Designing and making semiconductors is a clearly permissible business with no haram revenue line of its own.
The main items to confirm are the acquisition-related debt (from the Maxim Integrated and Linear Technology deals) and the receivables ratio against the Sharia thresholds, plus purification of a small amount of interest income.
Sharia Screening Methodology
Islamic scholars use several criteria to screen stocks:
- Business activity screen: Is the company's primary business halal?
- Debt ratio: Total debt / market cap must be under 33%
- Interest income: Interest income / total revenue must be under 5%
- Haram revenue: Revenue from haram sources must be under 5%
- Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)
What Analog Devices Does
Analog Devices, Inc. (headquartered in Wilmington, Massachusetts) is one of the largest analog-chip makers in the world. Its business spans:
- Industrial: Precision measurement, automation, and instrumentation chips — its largest market.
- Automotive: Signal processing, power, and connectivity for vehicles, including EVs.
- Communications: Components for wired and wireless network infrastructure.
- Consumer and healthcare: Sensors and signal-chain parts for devices and medical equipment.
Analog Devices sells physical semiconductor products — a high-value, permissible manufacturing activity.
Financial Ratios
Based on Analog Devices' most recent financial statements:
- Total Debt / Market Cap: Acquisition-related — confirm against filings ⚠️ (threshold: under 33%)
- Interest Income / Revenue: Minimal ✅ (threshold: under 5%)
- Haram Revenue: None identified ✅
- Receivables Ratio: Confirm against filings ⚠️ (threshold: 49–70%, varies by board)
Against its large market capitalization, ADI has generally screened within range. Confirm both the debt and receivables ratios against the latest filings before investing.
Concerns to Be Aware Of
1. Acquisition-Related Debt
Analog Devices took on debt to fund the Maxim Integrated and Linear Technology acquisitions. This is the primary screening item.
Action required: Confirm that total debt / market cap stays under the 33% threshold using the latest filings.
2. Manufacturer Receivables
As a chipmaker selling to distributors and OEMs, Analog Devices carries receivables that are worth checking against the ratio screen.
Action required: Confirm total receivables / total assets against your screening board's threshold (49–70%).
3. Minor Interest Income
Analog Devices earns a small amount of interest income on its cash. This should be checked against the 5% threshold, and the corresponding portion of returns purified by donating it to charity.
Verdict from Major Screening Agencies
Analog Devices stock is generally screened as compliant (halal) by:
- Zoya App — Generally Compliant ✅ (verify the current ratios)
- MSCI Islamic criteria — Generally meets criteria ✅
- Most major Sharia advisory boards — Approved with purification ✅
Bottom Line
Analog Devices (ADI) is generally halal for Muslim investors. Its semiconductor business is entirely permissible with no meaningful haram revenue. Confirm the debt and receivables ratios against the Sharia thresholds using the latest filings, and purify the small amount of interest income.
For Muslim investors seeking halal exposure to the analog and industrial-semiconductor space, ADI is a clean, manufacturing-based option.
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