Why is Analog Devices stock falling despite strong earnings and AI deal?

Shares of Analog Devices (ADI) fell sharply on Wednesday despite the semiconductor company reporting stronger-than-expected fiscal second-quarter results and announcing a $1.5 billion acquisition aimed at expanding its artificial-intelligence power management business. The stock dropped more than 4% during the session after rallying roughly 53% so far in 2026 amid growing investor optimism around AI-related semiconductor demand.