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We present a mathematical analysis of the common-mode instability and power back-off feature of a transformer-coupled Class-AB differential power amplifier (PA). The efficient impedance matching of the transformer combiner and efficiency improvement at power back-off, a major benefit of this structure, are illustrated. In addition, an analytical model is derived to predict the common-mode oscillations in PA. The analytical results, based on a simple hand-calculation model for the transistor, show good agreement with simulation results using complete 90-nm models. Two methods to suppress the common-mode oscillations are investigated and analyzed in detail.