NEW YORK - Skyworks Solutions Inc . (NASDAQ:SWKS), a leading semiconductor company, reported its second fiscal quarter results with a slight beat on earnings but provided a weaker-than-expected outlook for the third quarter, sending its shares down by 6.2%.
The company posted adjusted earnings per share (EPS) of $1.55, marginally surpassing the analyst estimate of $1.52. Revenue matched expectations at $1.05 billion.
Despite the current quarter's alignment with analyst projections, Skyworks' guidance for the third fiscal quarter significantly missed market expectations. The company forecasts adjusted EPS of $1.21, well below the consensus of $1.47.
Additionally, the revenue outlook of $900 million, with a possible 2% deviation, falls short of the anticipated $1.024 billion. This substantial guidance shortfall has triggered a sharp decline in the company's stock value.
Skyworks' chairman and CEO, Liam K. Griffin, acknowledged the tough macroeconomic conditions but emphasized the company's robust cash generation. He attributed the subdued performance to lower-than-expected demand in the mobile sector, which experienced weaker seasonal trends.
Looking ahead, Griffin expressed confidence in Skyworks' long-term strategy to expand its connectivity technology into various sectors, including IoT devices, automotive electrification, and AI infrastructure.
The second fiscal quarter saw Skyworks delivering integrated platforms to top 5G smartphone manufacturers such as Samsung (KS:005930), Google (NASDAQ:GOOGL), and Oppo. The company also reported advancements in automotive programs and secured design wins for audio systems with PlayStation® and Samsung.
Despite these achievements, the company's third-quarter outlook reflects a sequential downturn in its mobile business due to excess inventory needing to clear. However, Skyworks anticipates modest growth in broader markets as inventory levels begin to normalize in certain areas.
Skyworks also announced a cash dividend of $0.68 per share, payable on June 11, 2024, to shareholders on record as of May 21, 2024.
Kris Sennesael, Skyworks' senior vice president and CFO, outlined the third-quarter expectations, noting the anticipated challenges in the mobile segment and potential growth in broad markets. The company's guidance reflects these mixed prospects, with the market reacting negatively to the less favorable outlook.
Investors and analysts will closely monitor Skyworks' performance in the coming quarter, as the company navigates the inventory adjustments and strives to capitalize on its diverse technology applications across several growing industries.
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