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SWKS' fiscal Q4 earnings fell 27.3% to $1.28 per share, while revenues declined 5% to $1.05 billion.
Broad markets revenues grew 9%, fueled by data center growth of 90% and strength in Wi-Fi and automotive.
SWKS projects Q1 fiscal 2027 revenues of $1.8B-$1.9B and targets $500M in cost savings from the Qorvo deal.
Skyworks (SWKS - Free Report) reported fourth-quarter fiscal 2026 non-GAAP earnings of $1.28 per share, down 27.3% year over year. The figure surpassed the Zacks Consensus Estimate by 0.79%.
Revenues declined 5% year over year to $1.05 billion but beat the consensus mark by approximately 1.7%. The top line benefited from healthy demand at its largest smartphone customer and strength in broad markets, particularly data center, Wi-Fi and automotive. Broad markets revenues grew 9% year over year to approximately $416 million.
SWKS Broad Markets Revenues Rise 9% Y/Y
Broad markets represented approximately 40% of quarterly revenues, supported by strong demand for timing, power management and connectivity solutions. The business expanded approximately 10% in fiscal 2026 despite continued softness in consumer Internet of Things (IoT) products.
Data center was a key growth driver, with management highlighting approximately 90% year-over-year growth during the quarter. Demand for precision timing and power products remained robust as AI infrastructure deployments expanded. Wi-Fi and automotive also recorded strong growth, with the company’s primary growth businesses expanding more than 25% year over year.
Skyworks Solutions, Inc. Price, Consensus and EPS Surprise
Mobile accounted for approximately 60% of quarterly revenues, benefiting from healthy sell-through at the company's largest customer during its seasonally strongest quarter. However, weakness in the Android market partially offset this momentum.
The largest customer contributed approximately 62% of total revenues, including non-smartphone products. Skyworks continues to prioritize premium smartphones, where greater radio-frequency (RF) complexity creates opportunities for higher content per device.
Management expects the combined company's broader RF front-end portfolio to support additional opportunities as 5G-Advanced, 6G and satellite connectivity increase the need for advanced filtering, amplification and antenna technologies.
SWKS Expands Diversification Following Qorvo Deal
Skyworks completed its combination with Qorvo on Oct. 5, 2026, after the fiscal fourth-quarter close. Consequently, reported September-quarter results reflect standalone Skyworks operations.
Combined September-quarter revenues totaled approximately $1.98 billion, including $937 million from Qorvo. The latter's reporting period included an additional week that contributed approximately $70 million.
On a pro forma basis, diversified growth markets generated approximately $2.9 billion in fiscal 2026 revenues, increasing 12% year over year. Physical AI and Connected Edge contributed more than $1.6 billion, followed by defense and aerospace at approximately $500 million.
Data center networking infrastructure contributed approximately $400 million, while automotive generated approximately $340 million. These markets form the foundation of the company's strategy to diversify beyond smartphones.
Skyworks Faces Margin Pressure From Rising Costs
Non-GAAP gross profit declined 9.1% year over year to $464.6 million. Gross margin contracted 210 basis points to 44.4%, reflecting continued input cost pressures.
Non-GAAP operating expenses were approximately $237 million, near the lower end of management's guidance range. The company maintained disciplined discretionary spending while funding key research and development programs.
Non-GAAP operating income declined 13.9% to $227.2 million, while operating margin narrowed to 21.7% from 24%. Non-GAAP net income fell 26.7% to $193.3 million.
Management is addressing cost pressures through pricing actions, long-term supply agreements and manufacturing optimization. However, higher input costs are expected to remain a headwind.
Cash, cash equivalents and marketable securities totaled $2.61 billion at quarter-end, compared with $1.39 billion a year earlier. Total debt increased to $2.47 billion from approximately $996 million, reflecting acquisition-related financing.
Operating cash flow declined to $33.7 million from $200 million in the year-ago quarter. Capital expenditures totaled $94.7 million, resulting in negative free cash flow of $61 million.
Skyworks repurchased $107 million of shares during the quarter. Management continues to emphasize capital allocation flexibility, balancing repurchases, liquidity and potential acquisitions.
Skyworks Issues Combined Q1 Fiscal 2027 Outlook
For the first quarter of fiscal 2027, Skyworks expects combined revenues between $1.8 billion and $1.9 billion. At the $1.85 billion midpoint, non-GAAP diluted earnings are projected at $1.25 per share.
Smartphone revenues are expected to decline in the low teens sequentially, while diversified growth markets should increase in the low single digits.
Non-GAAP gross margin is projected between 46% and 48%, with operating expenses of $465 million to $505 million.
Skyworks expects approximately $150 million in operating expense synergies during fiscal 2027, weighted toward the second half. The company targets annual cost savings of at least $500 million within 24-36 months of the Qorvo closing.
Over the longer term, management targets mid-to-high single-digit revenue growth, non-GAAP gross margin of 50-55% and operating margin of 30-35%.
Forgent Power, Telos and NVIDIA are expected to report their quarterly results on Nov. 12, 9 and 17, respectively. Forgent Power shares have dropped 23.3% year to date (YTD). Telos shares have inched up 2.8% YTD, while NVIDIA shares have climbed 9% YTD.
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Skyworks Q4 Earnings Beat Estimates, Revenues Decline Y/Y
Key Takeaways
Skyworks (SWKS - Free Report) reported fourth-quarter fiscal 2026 non-GAAP earnings of $1.28 per share, down 27.3% year over year. The figure surpassed the Zacks Consensus Estimate by 0.79%.
Revenues declined 5% year over year to $1.05 billion but beat the consensus mark by approximately 1.7%. The top line benefited from healthy demand at its largest smartphone customer and strength in broad markets, particularly data center, Wi-Fi and automotive. Broad markets revenues grew 9% year over year to approximately $416 million.
SWKS Broad Markets Revenues Rise 9% Y/Y
Broad markets represented approximately 40% of quarterly revenues, supported by strong demand for timing, power management and connectivity solutions. The business expanded approximately 10% in fiscal 2026 despite continued softness in consumer Internet of Things (IoT) products.
Data center was a key growth driver, with management highlighting approximately 90% year-over-year growth during the quarter. Demand for precision timing and power products remained robust as AI infrastructure deployments expanded. Wi-Fi and automotive also recorded strong growth, with the company’s primary growth businesses expanding more than 25% year over year.
Skyworks Solutions, Inc. Price, Consensus and EPS Surprise
Skyworks Solutions, Inc. price-consensus-eps-surprise-chart | Skyworks Solutions, Inc. Quote
Skyworks Sees Healthy Premium Smartphone Demand
Mobile accounted for approximately 60% of quarterly revenues, benefiting from healthy sell-through at the company's largest customer during its seasonally strongest quarter. However, weakness in the Android market partially offset this momentum.
The largest customer contributed approximately 62% of total revenues, including non-smartphone products. Skyworks continues to prioritize premium smartphones, where greater radio-frequency (RF) complexity creates opportunities for higher content per device.
Management expects the combined company's broader RF front-end portfolio to support additional opportunities as 5G-Advanced, 6G and satellite connectivity increase the need for advanced filtering, amplification and antenna technologies.
SWKS Expands Diversification Following Qorvo Deal
Skyworks completed its combination with Qorvo on Oct. 5, 2026, after the fiscal fourth-quarter close. Consequently, reported September-quarter results reflect standalone Skyworks operations.
Combined September-quarter revenues totaled approximately $1.98 billion, including $937 million from Qorvo. The latter's reporting period included an additional week that contributed approximately $70 million.
On a pro forma basis, diversified growth markets generated approximately $2.9 billion in fiscal 2026 revenues, increasing 12% year over year. Physical AI and Connected Edge contributed more than $1.6 billion, followed by defense and aerospace at approximately $500 million.
Data center networking infrastructure contributed approximately $400 million, while automotive generated approximately $340 million. These markets form the foundation of the company's strategy to diversify beyond smartphones.
Skyworks Faces Margin Pressure From Rising Costs
Non-GAAP gross profit declined 9.1% year over year to $464.6 million. Gross margin contracted 210 basis points to 44.4%, reflecting continued input cost pressures.
Non-GAAP operating expenses were approximately $237 million, near the lower end of management's guidance range. The company maintained disciplined discretionary spending while funding key research and development programs.
Non-GAAP operating income declined 13.9% to $227.2 million, while operating margin narrowed to 21.7% from 24%. Non-GAAP net income fell 26.7% to $193.3 million.
Management is addressing cost pressures through pricing actions, long-term supply agreements and manufacturing optimization. However, higher input costs are expected to remain a headwind.
SWKS Maintains Liquidity Amid Acquisition Financing
Cash, cash equivalents and marketable securities totaled $2.61 billion at quarter-end, compared with $1.39 billion a year earlier. Total debt increased to $2.47 billion from approximately $996 million, reflecting acquisition-related financing.
Operating cash flow declined to $33.7 million from $200 million in the year-ago quarter. Capital expenditures totaled $94.7 million, resulting in negative free cash flow of $61 million.
Skyworks repurchased $107 million of shares during the quarter. Management continues to emphasize capital allocation flexibility, balancing repurchases, liquidity and potential acquisitions.
Skyworks Issues Combined Q1 Fiscal 2027 Outlook
For the first quarter of fiscal 2027, Skyworks expects combined revenues between $1.8 billion and $1.9 billion. At the $1.85 billion midpoint, non-GAAP diluted earnings are projected at $1.25 per share.
Smartphone revenues are expected to decline in the low teens sequentially, while diversified growth markets should increase in the low single digits.
Non-GAAP gross margin is projected between 46% and 48%, with operating expenses of $465 million to $505 million.
Skyworks expects approximately $150 million in operating expense synergies during fiscal 2027, weighted toward the second half. The company targets annual cost savings of at least $500 million within 24-36 months of the Qorvo closing.
Over the longer term, management targets mid-to-high single-digit revenue growth, non-GAAP gross margin of 50-55% and operating margin of 30-35%.
Zacks Rank & Stocks to Consider
Skyworks currently has a Zacks Rank #3 (Hold).
Forgent Power Solutions (FPS - Free Report) , Telos (TLS - Free Report) and NVIDIA (NVDA - Free Report) are some better-ranked stocks in the broader Zacks Computer and Technology sector. While Forgent Power and Telos sport a Zacks Rank #1 (Strong Buy) each at present, NVIDIA carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Forgent Power, Telos and NVIDIA are expected to report their quarterly results on Nov. 12, 9 and 17, respectively. Forgent Power shares have dropped 23.3% year to date (YTD). Telos shares have inched up 2.8% YTD, while NVIDIA shares have climbed 9% YTD.