Skyworks forecast misses as smartphone weakness pressures chip outlook
A softer premium smartphone market is continuing to weigh on Skyworks Solutions as the chipmaker enters its new fiscal quarter. The company is guiding revenue and adjusted profit below Wall Street expectations, even as it reports fourth-quarter sales slightly ahead of estimates and advances its Qorvo integration.
Highlights
- Skyworks forecasts first-quarter revenue of $1.80 billion to $1.90 billion and adjusted EPS of $1.25, both below analyst expectations.
- Smartphone revenue projected to decline in the low-teens percentage range sequentially due to seasonal patterns and ongoing weakness in the premium Android market.
- Skyworks shares fall over 14% in extended trading after weak outlook, despite Q4 revenue of $1.05 billion slightly topping estimates and Qorvo acquisition expected to deliver $500 million in annual cost savings.
Quarter outlook points to weaker handset demand
As reported by Reuters, Skyworks expects first-quarter revenue of $1.80 billion to $1.90 billion, below analysts' estimate of about $1.99 billion. The company also projects adjusted earnings per share of $1.25, under expectations of about $1.52, according to data compiled by LSEG.Skyworks says smartphone revenue is expected to decline in the low-teens percentage range sequentially. The forecast reflects seasonal patterns as well as continuing weakness in the premium Android market, a key segment for the company's core business.
Investors react sharply to the outlook, sending Skyworks shares down more than 14% in extended trading. The move underscores market concern that handset demand remains too weak to support near-term growth for suppliers tied closely to smartphones.
Acquisition synergies offer a counterbalance
For its fiscal fourth quarter, Skyworks reports revenue of $1.05 billion, compared with analysts' estimate of $1.04 billion. While that result comes in slightly ahead of consensus, it does little to offset the weaker guidance for the current quarter.The company says it completed the acquisition of Qorvo after the end of the fiscal fourth quarter and expects the combination to generate at least $500 million in annual cost savings. Those synergies could help support margins over time, but the near-term picture remains dominated by soft demand in the smartphone market.
Our earlier coverage of the Nasdaq 100’s recent selloff highlighted how the index slipped below key short- and medium-term moving averages even as a blockchain-native fund (JQQQ) was launched to broaden access to NDX exposure. We noted that, despite the longer-term structural significance of new investment channels, near-term sentiment remained fragile with elevated downside risk unless the index could reclaim nearby resistance levels.
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