Skyworks Solutions surpasses Wall Street estimates on sales and earnings

Skyworks Solutions tops earnings estimates.
Image: Skyworks Solutions

Analog semiconductor maker Skyworks Solutions beat Wall Street’s forecast for its sales and earnings in the fiscal third quarter. The firm also overcame coronavirus related disruption to exceed the FQ3 revenue range it offered in May.

The manufacturer offered guidance indicating its growth trend will continue through the fiscal fourth quarter.

Skyworks’ Mighty FQ3 Financial Results

In the period ending June 26, Skyworks generated $736.8 million in revenue with adjusted earnings per share (EPS) of $1.25. Zacks Equity Research reports the semiconductor company topped its consensus sales and profits forecast by 10.62 and 6.77 percent, respectively. The firm also blew away the gross income estimate it provided last quarter, which called for an intake of $670 million to $710 million.

In a press release, CEO Liam K. Griffin said his company’s robust fiscal third-quarter returns came as a result of increased demand for its offerings. The executive noted Samsung and LG utilized its components in the release of its latest 5G-enabled handsets. The manufacturer also noted its bottom line benefited from an upswing in Wi-Fi 6 and LTE product shipments.

Skyworks did not mention the coronavirus pandemic in its earnings announcement, which it called a major earnings headwind last period. The company seemingly recovered both its manufacturing and logistics operations to a level where meaningful growth is possible. In fact, the firm’s recent financial success prompted it to raise its quarterly dividend by 14 percent to $.50.

Skyworks’ FQ4 Forecast

For the September ending quarter, Skyworks anticipates bringing in between $830 million and $850 million with adjusted EPS of $1.51. If the manufacturer’s fiscal fourth-quarter sales fall within its forecast range, it will beat its FQ4 2019 revenue by 0.36 percent or 2.78 percent.

In addition, the company’s financial results estimate outpaced Zack’s consensus sales outlook by 5.56 (or 8.10 percent) and its earnings prediction by 7.09 percent.

In an investor call, Griffin said his firm is well-positioned to take advantage of the smartphone upgrade cycle precipitated by the 5G rollout. Since its client Samsung intends to launch a slew of midrange and premium fifth-generation mobile data network capable handsets this year, Skyworks should see an accompanying spike in component sales.

Right now, the coronavirus pandemic’s full impact on consumer demand for personal electronics is a major unknown. But Skyworks’ innovative offerings and key strategic partnership should see it end FQ4 and 2020 on a strong note.


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