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Skyworks Solutions Inc.

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Skyworks operates in a fiercely competitive market and as such has to continuously invest in R&D efforts that act as value drivers to fend off competition. We remain concerned about profitability as heavy investments in R&D escalate operating expenses, often without any significant contribution to its top line. As other handset players gear up to capitalize on the increasing demand for smartphones, pricing pressure further leads to a decline in margins. Significant concentration risks and macroeconomic uncertainty remain other headwinds that might peg back its profitability to some extent. However, the company reported strong fourth-quarter fiscal 2015 results with year-over-year increase in earnings and revenues, driven by superior execution of operational plans and healthy demand pull.



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